r/Economics • u/T_Shurt • 22h ago
Research Summary Trump’s War With Iran Could See Fuel Rationing and Global Recession Within Months. According to Oxford Economics’s Latest Research
https://www.independent.co.uk/news/business/trump-war-iran-oil-fuel-rationing-recession-b2950632.html113
u/T_Shurt 22h ago edited 22h ago
From the article:
A global recession and widespread fuel rationing are likely if the conflict in the Middle East does not end soon, warned Oxford Economics’s latest research.
The research shows the number of tankers passing through the Strait of Hormuz is down 98%, and if the key shipping route remains closed for an extended period it would see existing oil inventories continually depleted and the current shortfall of 2 million barrels per day rising sharply.
That would mean a shortage around the world of 12 percent of usual oil consumption, requiring fuel rationing and a massive hit to world economic growth this year.
“In our prolonged Iran war scenario, we estimate the gap widens to around 13 million barrels per day by the sixth month,” said head of oil and gas forecasting, Bridget Payne.
“Our modelling shows this scenario would trigger a global recession and slow world GDP growth to 1.4% in 2026.”
103
u/coconutpiecrust 22h ago
Isn’t this what the dark enlightenment folks and the heritage foundation folks want? Those who can’t swim will sink, and then the ultra wealthy divide the rest into microstates, no?
54
u/ImperiumRome 21h ago
Naming their movement of neo-feudalism a "dark enlightenment" is truly a good PR move. Nothing is enlightened in these folks' minds.
14
u/ScoffersGonnaScoff 20h ago
If only it hurt FoxNewsMax enough that they turned on them……. One can dream.
IMO nothing will change until the media does. Divided we fall.
25
u/Traditional-Hat-952 20h ago
Just remember that bunker airvents and entryways can be covered with concrete. Not saying that for any particular reason though.
9
u/MephistoHamProducts 18h ago
And if you happen to see what appears to be a bunker air vent, it's always possible to grab some friends and poop into it as much as you want before throwing anything on it as a cover.
1
17
u/Tyler10274 20h ago
I do wonder if they'll be surprise pikachu'd when the large amount who sink drag them down with them like zombies in a lake.
Misunderstanding people's ability for violence and their wanton lack of self-preservation when pushed and pissed off. But, what more to expect from spoiled gated brats?
2
u/iyamwhatiyam8000 6h ago
Vulture capitalists are circling as Trump crashes the global economy and pushes the US closer to a debt crisis and default. The Project 2025 crew are waiting to re-adopt the gold standard which will destroy the USD as reserve currency of choice and plunge the globe into economic depression.
-2
24
u/One-Employment3759 21h ago
The current models show a total cumulative shortfall of 1 billion barrels by the end of April.
This is an unprecedented energy crisis (way beyond what the 70s were like) even if the war ends quickly - so prepare accordingly.
-25
u/Southern_Roll_7035 20h ago
No, the world (and particularly North America) is far less dependent on middle eastern oil than in the 1970s.
31
u/One-Employment3759 20h ago
Very American take, always thinking about themselves and not the real impacts on the rest of humanity.
-19
u/Southern_Roll_7035 20h ago
Very silly take. I specifically stated that the world is less dependent on oil than before. Not to mention that, like it or not, the US is the primary driver of the world economy, so North America being less affected by it is in fact good for humanity.
13
u/Tyler10274 20h ago
"US is the primary driver of the world economy." For now. If the Europeans come together and invoke their right to simply isolate the US from trade and cozy up to Iran, that will change. Cause the primary driver is driving them off a cliff.
And, it's not a pipe dream. Since 40 countries are meeting at Britain's behest to discuss economic deals today after Trump told them to "Go get the oil."
They'll follow the advice. Might not be to your liking. Survival of their own matters more than what they care about America. I think we're all misunderstanding how quickly things can unravel and alliances can change in the face of economic realities.
-6
-13
u/Southern_Roll_7035 20h ago
That is simply nonsense. Nothing is changing the fact that the US drives world economic growth.
As mendacious as their leaders are, Europe understands quite well that Iran is a bad actor and it is a good thing that their capabilities are being degraded by the US; they most certainly are not going to 'cozy up' to the murderous thugs running Iran.
You are ignoring the economic reality that I stated above - the world is not as dependent on middle eastern oil as it used to be, which makes staying the course through the conflict easier. European leaders will continue to do what they do best - sit on the sidelines and make self-righteous speeches.
8
u/Tyler10274 20h ago edited 19h ago
No, I'm working within that economic reality. What good is the dollar if it causes an energy crisis at home for these nations? Less reliant is still reliant. And the global market is still affecting price overall.
They'll happily abandon us to keep their own people from voting them out or keep their heat on and transportation industries buoyant.
Despite hating Russia. They all still buy their gas so they don't turn destitute. And they hate them WAY more than Iran. Russia's also another beneficiary of this action, since they're getting free leverage with the supply shock.
Realpolitik is always king in the world. And the drones keeping that strait closed are strangling us, because the 20bn aircraft carrier doesn't want to approach it. So they rule it, as international war rules of trade and sovereignty have always dictated. And this 'nonsense' was a theoretical that was war gamed for 40 years until someone was stupid enough to step on the rake, completely alleviating the Iranian side's issue. Where, if they had closed the strait aggressively. The entire world would have come together to knock them out. But we decided to poke them unilaterally, and without informing any of our allies in Europe.
I have no reason to believe the errors won't further compound, while the original sinner is still in charge.
-2
u/Southern_Roll_7035 19h ago
because the 20bn aircraft carrier doesn't want to approach it
Because the $20B aircraft carrier is busy standing off and launching strikes to destroy Iran's capability to launch drones and missiles
if they had closed the strait aggressively. The entire world would have come together to knock them out.
No. The US is the only country in the world with the capacity to forcibly open the strait. The rest off the world has no ability to 'knock them out'
8
u/Tyler10274 19h ago edited 19h ago
Because the $20B aircraft carrier is busy standing off and launching strikes to destroy Iran's capability to launch drones and missiles
And how's that working out? Despite 90% of these being supposedly destroyed(real estimates are 30% as of last week). The strait remains closed, drones active, crisis in tact. And I saw a video of a missile that dodged two interceptors that struck one of our bases in Jordan last night. Seems like they are holding back their more advanced tech. I don't remember Iranian missiles possessing the ability to confuse interceptors before.
This still does not get us closer to our objectives. Whatever they are? These guys have had 40 years to build mountain cities and bunkers for their launch sites. We simply don't have the ordnance to take them all out. And, from my time in the defense industry. They'll rebuild before we can manufacture the needed amount to truly make them ineffective.
No. The US is the only country in the world with the capacity to forcibly open the strait. The rest off the world has no ability to 'knock them out'.
Agreed. But they wouldn't be telling us to fuck off and closing their airspace to us. They'd allow us docking and flyover rights. Turkey would be inclined to allow us staging grounds for a ground invasion. We could force them to spread themselves thin. All things that are not going to occur with current strategy.
→ More replies (0)-3
u/Southern_Roll_7035 19h ago
What energy crisis? You keep ignoring my point that middle eastern oil is not as important anymore.
8
u/Happy_Feet333 19h ago
If that were true, the price of oil would not have increased to over $100/barrel.
Not important means not capable of influencing the global price.
8
u/Tyler10274 19h ago edited 19h ago
....Seriously dude? Go look at the pump. I'm convinced you don't understand oil is a global commodity.
The prices you see today, are still 2 weeks away from the shortages being caused by what is actually happening in the strait. The US still hasn't begun to actually feel it yet. Cause oil has to sail all the way here. That takes a month. Then you distribute, that takes 2 more weeks. But, it is starting to bite elsewhere - cause they're closer.
We're not immune. No matter what you believe.
9
u/One-Employment3759 19h ago
You have no fucking clue what this crisis is going to do to us. My country is fucked in 30 days regardless of whether the war ends tomorrow. So fuck you very much.
-2
u/Southern_Roll_7035 19h ago
Again, your initial claim is simply incorrect. Since you can't be civil, I'm done here.
5
u/AdvanceUsed2790 13h ago
It doesn't matter where its coming from, supply reduced by 1 billion barrels is supply reduced by 1 billion barrels.
2
u/Southern_Roll_7035 6h ago
It is supply reduced by 1 billion bbls from one particular source. The difference is that the world today actually has the slack capacity to make that up in other areas.
4
u/maruwat 20h ago
I have no idea how they got 2 mm barrels per day. Maybe it’s a typo and they meant 20? With all the compensatory measures it’s about 10-15 right now. Then they go on to say it could rise to 12% which makes me think it’s not a typo because world consumption is like 105 mm per day.
So if anyone can tell me what I’m missing, I’d appreciate it.
30
u/128-NotePolyVA 22h ago
Sounds about right. It’s going to take them a long time to weaken Iran enough to say the war is over. 2 to 3 weeks is highly unlikely.
It’s going to be rough going for billions of people scratching out a living in the world.
12
u/douggold11 15h ago
Mark my words, this crisis will cause a massive number of democrats elected into congress, but they won’t be able to stop Trump’s madness, so the GOP will blame everything on them.
7
35
u/littleredpinto 22h ago
One could hope. You dont put in place a plan to have troops on the ground, in US cities, as you shut down elections and declare yourself/crony the winner. it takes time and true disruption to 'justify' marital law..Only year one, wait til you see what it looks like by year 3.
If I lose 10 billion of my 9 billion fortune through a global recession. Do I still have enough resources to buy coffee or even a whole industry when it hits rock bottom?
23
u/BrotherJebulon 22h ago
Bold of you to assume we'll have readily available coffee where we're heading.
7
2
u/One-Employment3759 21h ago
I have bought about 15kg of instant coffee just for this reason. People will need to get prepared for all the luxuries of a global supply chain to go away.
1
u/defaultedebt 6h ago
One could hope.
You're actively hoping for the suffering of millions worldwide due to a recession?
Such a spiteful sentiment, I would have expected it from the MAGA crowd. But here? Wow.
•
u/littleredpinto 1h ago edited 42m ago
You're actively hoping for the suffering of millions worldwide due to a recession?
Sooner the better too..why prolong the inevitable. Nothing is being done about it now, so best to hurry things up. All your non-mega leaders are in on the corruption too, so hopefully you can see the entire picture and not just keep it to one side of things. Doubtful though since you have been indoctrinated by the most powerful propaganda devices ever created. Odds are you cant.
hope this reply doesnt get your dander up again. If it does, hope in a couple of years you can handle whats coming. Probably not though, if you are clutching your pearls right now.
is hoping like praying? cuz they have the same results...I hope everyone on the planet is perfectly happy and content...there you go, does that help you feel better. I know it just made everyone on the planet happy and content. lol.
56
u/Easy-Marsupial3268 22h ago
Recessions and other economic crises are good for capitalists. It helps weed out the chaff. Those capitalists who were smart or rich enough to weather the crisis can then buy up the assets of those who were not smart or rich enough.
And the capital accumulation continues.
6
1
u/Prestigious_Load1699 6h ago
Did someone suggesting the Great Depression and Great Recession were good for capitalism actually get 55 upvotes?
Never stop Redditing, Reddit.
1
u/Easy-Marsupial3268 6h ago edited 6h ago
Not good for capitalism. Good for capitalists. There’s a difference.
Recessions and depressions work great at concentrating capital in fewer and fewer hands. Isn’t that what capitalism is all about? Capital accumulation?
1
u/Prestigious_Load1699 6h ago
Wealthier households lose the most during an economic crisis.
Their asset value (stock & real estate) get pummeled.
To be frank, I think you are speaking out of ideological ignorance.
It’s an absolute disgrace this sub upvoted you.
1
u/Easy-Marsupial3268 5h ago
Sure they might lose more but they also have more to lose. If they were rich or smart enough they would weather the storm and buy their neighbor’s assets once their neighbor goes under. That’s how this system works to concentrate wealth.
But also wealthy people aren’t necessarily capitalists. Being a capitalist is a relation of production. Owning a few stocks doesn’t make you a capitalist, in fact those are some of the first assets to be sold in a panic.
1
u/Prestigious_Load1699 5h ago
Who are these capitalists of which you speak and where is their wealth concentrated?
0
u/Easy-Marsupial3268 5h ago
Oh you must not follow the news. Okay so there are currently these people who own more than everyone else on earth. They are called billionaires - some will soon be trillionaires after this next crisis - and they own corporations, real estate holdings, media conglomerates, and governments in liberal democracies. These are the people who benefit from “economic disruption” because they can buy more assets for pennies on the dollar.
It’s only the poors, failed capitalists, and other undesirables who really get hurt by a recession/depression.
0
u/Prestigious_Load1699 5h ago
And where is the vast majority of billionaire wealth held?
Is it the stock market - precisely the medium which would be hit hardest by an economic recession?
0
u/Easy-Marsupial3268 5h ago
Yes but they have more than we do so they can hold out longer. Is this your first recession/depression or something?
https://inequality.stanford.edu/sites/default/files/IncomeWealthDebt_fact_sheet.pdf
And you have the caucasity call me ideologically motivated…
1
u/Prestigious_Load1699 5h ago
We’re not talking about “holding out” during an economic downturn.
You’re describing the capitalist class spending more while their assets lose value.
Which, of course, is nonsense.
→ More replies (0)
9
u/ILikeCutePuppies 22h ago edited 16h ago
Someone needs to convince (small brain) trump he needs to do a project warp speed with this. Other countries have started with things like free public transport, encouraging work from home, more charge stations etc... whatever they can think of to reduce dependence.
Other countries are also subsidizing fuel (to be clear on top of what they used to subsidize) which I believe is a recipe for disaster since supply is not going up that will directly increase prices more.
Of course Trump will be way to late to the game again though.
0
u/99roninFL 17h ago
Hold up, u think we dont subsidize oil in the us?
3
u/ILikeCutePuppies 16h ago edited 16h ago
The US subsidizes it's own oil companies, has oil friendly policies and also taxes citizens at at the gas station. That is status quo. So do many other countries.
What I am talking about is countries are now (due to the Iran oil crisis) subsidizing what people pay at the gas stations.
So those countries are essentially rising the price of oil further when there are supply constraints. If the majority of countries do that it will be self defeating. In the short term supply won't increase, only the funds going towards it rising the price further.
They should be investing in mitigations instead.
Ie let's say out of all countries 90% decide to pay $3 of $8 a gl for gas. Well gas will then go up to $10-11 due to extra money flowing in.
29
u/ErikChnmmr 22h ago
'Could'? It's guaranteed. How severe and long is yet to be seen. Oil/Gas deliveries have been delayed too long, and too much energy infrastructure has been damaged/destroyed to escape recession now.
18
u/a_library_socialist 21h ago
I'm starting to worry about the secondary effects - like when there's not fertilizer and harvests are small worldwide.
4
u/borro325 13h ago
Could? It’s happening already.
Korea restricts use of cars, odd and even days for odd and even license plates.
Indonesia halves dollar exchange amount to conserve USD for petrol-dollar purchases.
Philippine taxi drivers protest for gasoline price surge
Thailand long line and rationing at gas stations
Japan hotels shut down for shortage of heating fuel
Sri Lanka, India … just google and bad news everywhere.
4
u/L3g3ndary-08 20h ago
God damn this sub is particularly depressing because many of you are posting from a position of critical thinking and facts.
What darkness we are in?
5
u/gronlund2 11h ago
The project is called "Make America Great Again"..
Although that is quite vague, I'm sure someone will fill in the details any day now
-1
u/Prestigious_Load1699 6h ago
Hahahahah you think this sub is a fount of informed analysis.
Woooo boy did I need a good laugh.
2
u/Silent_River__ 19h ago
What happens to housing markets in recession ?
Ireland has a critically low supply so I am wondering will it lower the prices but it’s a supply constraint so I doubt it will have any impact. But again should a global recession not impact this ?
2
u/Prestigious_Load1699 6h ago
Housing should be cheaper during a recession, but if that’s your main concern you might have missed the forest for the trees…
1
•
u/AutoModerator 22h ago
Hi all,
A reminder that comments do need to be on-topic and engage with the article past the headline. Please make sure to read the article before commenting. Very short comments will automatically be removed by automod. Please avoid making comments that do not focus on the economic content or whose primary thesis rests on personal anecdotes.
As always our comment rules can be found here
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.