Trump Gaslighting Public on Gas Prices — Dave Talks: Politics 🌐

Trump demands immediate gas price cuts are but retailers aren't the real problem. Let's go and have a look at the short hands, the bombastic orange-faced baboon. That's a bit rough, but look he isn't early yet, right? And he has basically come out with another post on his own platform. What an ego strike this guy's goto. He basically has come out and said he's issued a public order present. Trump has directly told gasoline retailers to immediately cut price, immediately cut price bloody idiot. And yeah, with oil now trading at about 68 bucks a barrel, just across the train lines here. Yeah, oil's about 68 bucks a barrel and falling in pump prices, short drop much faster but not. He tied the demand explicitly to the end of the Iran conflict. Hasn't ended, of course, and the reopening of the straighter hall moves, which hasn't reopened. And saying that retailers, he's putting it all on retailers, must quickly react to this statement, quote, must quickly react to this statement and do what they know is right. Unquote, he's an idiot and I'll go into why. The political message is clear. Cheap gas is the most visible daily proof. Voters can see that ending the war actually delivered results. Because if they don't get cheap gas, then it's all just bluster. It's all just made up lies. That's what they will be thinking. So let's just go into this and see how the voters are going to be responding. When they go to the gas tank, they go to the gas station, flip their tanks next, because that is for sure the real measure of success or failure of this administration. So yeah, let's kind of look at that. So the reality of retailer margins. So gas station owners, retailers, make very little money on fuel. Their typical margin on gasoline is only around 8 to 12 cents per gallon on average, sometimes even lower during their intense competition. When there's price wars between retailers. This is one of the smallest parts of the final pump price. Retailers are not the ones pocketing big profits when oil prices fall. And blaming them for slow price drops is basically lying. That is disingenuous. That is gas loading the public. Like he knows better. I mean, if he doesn't know, then he shouldn't be the bloody president. So who actually controls the price? The biggest variable in gasoline prices after crude oil itself is the refiner's crack spread. I know, I know. It's not that crack, it's a different crack. It's the crack spread. The profit margin is basically the profit margin that refiner's make when they turn crude oil into gasoline and diesel and jet fuel and all of the refined products that they produce. And when crack spreads are wide, when they're wide open, refiner's keep prices higher, even as crude falls. And when crack spreads collapse and they tighten up, then pump prices drop faster. So that's the difference, right? That's the difference. That actually occurs in the refining market. And that's where most of the margin sits. So right now, refining margins they remain relatively firm due to tight refining capacity in the US and ongoing supply tensions, mostly supply tensions. But there is a bit of tension around the actual refining capacity. The big, the huge, big metal factories basically that take crude oil and outspits a whole bunch of different refined products. Now these things are, they are, they are fairly fixed, they don't change over time. It takes a long time to build one of these things and to commission it. Get it up and running. There's a lot of steel involved. There's a lot of chemicals involved. There's a lot of approvals and permits and well, that's sort of stuff. You know, it's not like, oh, it's going pretty well. It's going to stand up another refinery. No, it's not how it works. That's not how it works. That's how he thinks it works. They idiot. So, yeah, so basically, yeah, I mean, it takes a long time to bring new refining production capacity online. And it works out that they've been shutting down a bunch of refining capacity. One, and two, the oil stock, that the oil barrels that they get into the country, they actually need really dirty, the refineries. They're set up to consume really dirty oil. They're not set up for the light, sweet crude, which has basically got, it's got, it's a very clear, it looks kind of looks like olive oil, you know, like a dark olive oil. They're not, they're totally not set up to consume that. They generally export that to other refineries in other countries. But they are set up to refining heavy crude from the Canada Sata Sands, from Venezuela, from places like that. So, that you can't just switch these from, you know, refining heavy product to refining different types of products. So, yes, you can bring more stuff in from overseas. But that doesn't help you because you can't refine the stuff. They're refining capacity is limited. So, yeah, so basically, that's the key driver. These are the key drivers of this mess. It's like this really unfortunate confluence of the disaster in the hall moves, Trump, the shutdown of refineries. Maybe not Trump, maybe that's a bit of Biden, or maybe that's just the market, who knows. But also, the slowdown of capacity of barrels basically out of Venezuela, Trump. You know, you see where this is going. Yeah, Trump, he's got a lot of blame. He should be taking a lot of blame. And is he taking the blame? No, he's coughing the blame out. See what he's just doing. He puts a tweet out there and he blames the retailers. And the retailer's got absolutely nothing to do with this. 12 cents, 12 in the five bucks. Their markup is 12. Their markup is 12 cents. 12 cents is a bloody joke. So either he's an idiot, probably, or he's gaslighting, probably. He's probably an idiot and gaslighting. That's my conclusion. So, yeah, so capacity and supply tensions. That's the main issue. United States is relatively tight refining capacity, especially for diesel and jet fuel. Now, these are critical for their economy, obviously. And that's the main issue that I'm flagging here today, is he's flagged, and he's put it, he made a stupid statement again. I mean, what a total idiot. He's made a stupid statement, and he's shining the light on an issue that he doesn't understand. But what's interesting is these are all his cock-ups. The reason why the US are in such a pickle right now is because of his inability to push back on Israel going into Iran and causing him to go in. That was on him. And then as well, what a total disaster that is to be. Because you're basically Pope China in the eye, and you could argue that's a good thing. Maybe that's actually part of being dominant in your own hemisphere and the Western hemisphere. I mean, I don't disagree with that. I think it's probably a not bad thing to do, it's just how you execute. You could argue they've executed flawlessly. You know, they've minimized the loss of life. They haven't gone into a hot war. No boots on the ground. They've managed to do a regime change. That's pretty neat and tidy, clean. But I think you could argue that. I don't argue that. I think they could have done a lot better job. If you were Obama, or I think I'm not a big fan of Obama, but I think Obama to be fair. His politics were far more effective than what we're seeing right now. Because he just came out. Actually, he's put out piece. If I can find it, I'll chuck it up here or splice it in here because it's quite interesting. Yeah, so basically Obama saying, you know, when he did it, he managed to get a lot of really positive accommodations with Iran. They stopped. They stopped. They're a thing. The JCPOA. They stopped their refinement. They stopped this and they stopped that. And it was a pretty exceptional deal, you know. It was just that Trump's ego got him away. And he wanted to tear it up so that he could prove that he had a, his dick was bigger, you know. It was like, it's just a stupid bloody. It's like childhood, you know, when you go to school and you've been bullied by Obama. There's a bigger kid in the class and it's Obama and he's bullying you. You want to get him back. That's kind of what's happened. So really embarrassing for Team West. It's embarrassing for United States of America. We need to do better than this team, you know. Because that's, I mean, what an absolute cock up. Now I'm hoping. Well, I'm really, I hope you're hoping. Well, let's hope together that we're not about to go into a major, like 19 early 70s oil crisis. And that would be a self-inflicted wound, a notable wound going into the midterm. So I hope that we're not about to go into that. But look, you know, he understands, right? He understands that voters feel gasoline prices at the pump far more than they follow oil futures. You know, nobody really knows what the hell an oil future is. I don't know what 68 bucks a barrel means. How does that relate to the tank price? You know, when you go to the petrol station, you're going to fill up. Well, what's the correlation? You don't really understand that sort of stuff, right? By publicly pressuring retailers, he's trying to accelerate visible price relief ahead of the midterms and claim credit for ending the war. However, the economics, well, his understanding of the economics is like, you know, it's like an infantile. He doesn't understand it. Nobody bothered to tell him. Somebody should say, oh, Mr. President, that's bad. That's a really bad thing to say. Shouldn't say that, Mr. President, because that's just a plain utter lie. You are gaslighting the public. You're telling them something that you know not to be true. And you're going to be accused of being a liar. Yeah, somebody should have told him that. Maybe they did. And he was like, stuff you. I need to position for the midterms. That's my view. That's my opinion team. That's what I think has just happened. Bottom line team. So Trump's demand for immediate gas price cuts at retail is politically understandable. Sure. But it misidentifies the real drivers gas stations can't do that. 12 cents. The refineries can't do that, because the crack spread. So it doesn't matter what's happening on the futures market for the prices. What does matter is the real market, the settlement price for a barrel of crude one. That's pretty important. But more importantly too, the capacity for the dwindling refineries to actually convert those barrels into refined product. And basically, in a situation as a lot of the barrels that are coming in are not fit for US refineries. So that's the main issue. They've got the wrong type of crude. Pretty simple, wrong type of crude. Now I can't believe that his energy secretary wasn't able to explain this adequately to him. Obviously that's the case because otherwise he is alive. And he is just gaslighting us. Yeah, and it may well be. It may well be that's the case is hard to tell. So yeah, I thought it was pretty interesting, but he's small hands doing it again. Guy just cannot help himself. Just spouts a whole bunch of bullshit. That's what he does. So look, I hope wherever you are team, I hope you're able to avoid a whole bunch of bullshit. And I hope you have an awesome day. Cheers, bye.