America Iran Nuclear deal! Oil prices to shoot up by May.
Politics and investments are as intertwined as voters and constituencies. If you do not have an absolute grasp of world politics, you can never succeed in the field of investment banking, definitely not on Wall Street.
You need to know the history. One countries relation to the continent it’s based on and the continents relation with other continents, current, historic and future scenario. You have to have read multiple books on the current leaders running these countries, know their ideologies, their strengths and their strategies. You need to keep an eye on who their advisors are because the old saying fits here that “Show me your friends and I will tell you who you are”. Let’s apply all of the above politics to today’s international situation and to Trump and try to make money out of it.
Well, if you have studied Trump, his biography his deals in the past as a businessman and his erratic business acumen, you would come to know that he does what he wants to do and then thinks of the consequences later. Like a spoiled child. He fired Tillerson and brought an Ex-CIA Chief. He fired the old National Security Advisor and brought John Bolton. Mike Pompeo and John Bolton are brought in for a reason. Both these gentleman are war mongers, hardliners and have an innate hatred towards Venezuela, Iran and North Korea.
Trump needs these two on his side if he is going to cancel the Iran Nuclear deal within the next few months. He also needs them to agree to put more sanctions on Venezuela. He already has the other big oil producer Saudi Arabia eating out of his hands. For Saudi to buy $550 Billion worth of American defense equipment it needs money that it does not have. Unless the oil prices shoot Up. Oil prices shoot up, KSA gets richer, buys American equipment, America gets more jobs more money and economic boost to an ailing economy.
The only way to achieve this is by putting more sanction on oil producing Venezuela and Nuclear deal cancellation of Iran. That will knock out $250 Billion a year of oil exports from Iran and $345 Billion from Venezuela. Oil prices will go through the roof. America will buy all its oil from KSA, making KSA profitable and rich enough to have enough money to buy $550 Billion in arms from America.
It will send a strong message to North Korea but in my view historically America has never had three enemies in one decade ever or in one Presidency. So America will make peace with North Korea because it cannot afford to have an enemy that has the ability to hit its west coast while it is locking horns with Iran and Venezuela. Yes it may sound like a ridiculous idea to you that America and North Korea will be friends, but they will be. More arms in KSA means a stronger defense strategy against Iran and a poorer Iran means a weaker Defense capacity. All birds killed by one stone.
Moral of the story:
Oil prices are about to shoot through the roof around May. Why May, why not now? Because if you read history, all United States Secretaries and National Security Advisors take about 60 days before they announce their policies. And that will be by May.
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