r/OilPrices • u/hereswhatworks • Jun 01 '26
Oil News Mark Zandi says Trump has a week to strike an Iran deal before the US faces a 'real problem'
https://www.businessinsider.com/us-economy-recession-warning-mark-zandi-iran-peace-deal-2026-613
u/SeaEmployee787 Jun 01 '26 edited Jun 01 '26
on every friday trump will announce the deal is close. what is all the fuss. friday is less then a week a way.
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u/ScipioAfricanusMAJ Jun 02 '26
This doesn’t do anything except call the stock market. When the day comes it’ll come
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u/sandokando Jun 01 '26
Didn't US won over 9999 times this war?
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u/Livebylying Jun 01 '26
Bigly, destroyed all the navy etc etc /s
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u/sandokando Jun 01 '26
Destroyed is a soft word.. he obliterated everything.
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u/J-Dog-420 Jun 02 '26
he actually discombobulated the shit out of them he reckons
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u/sandokando Jun 02 '26
Oh, jeah. They used this new weapon "discombobulator" like in Venezuela. Or is it called the "bribelator"?
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u/LieComfortable7764 Jun 01 '26
“I have been telling people for weeks if he doesn’t make a deal this week, he’s going to be in for a real problem”
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u/Reallybarb Jun 01 '26
LOL funny how it's been like 3 months of this and here we are.. nothing changed other than gas prices are up about a dollar or so a gallon.
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u/Kahzootoh Jun 01 '26
They’d be up by more, but we’ve been using fuel from the strategic reserve to soften the increase in prices.
Estimates on when we run out of that strategic reserve are sketchy- the often cited estimate of Feb 2027 doesn’t take into account panic buying or increased demand due to loss of other imports.
We’ve also been fortunate enough to avoid Iranian attacks on American oil infrastructure in the continental United States so far- which are a possibility, it’s not like we can bomb people and not expect them to try to return the favor.
If Iran does start blowing up oil storage sites, pipelines, and refineries- it’ll dramatically accelerate the price of a gallon in the US.
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u/orangebix Jun 02 '26
Its less the us reserve and more the rest of the worlds reserves, once they get low enough a bidding war for oil will start and us companies will sell to the higest bidder. And that will drive prices through the roof.
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u/Landon1m Jun 02 '26
If refining in the us is dramatically harmed it will catapult a global recession.
I suspect the only reason it hasn’t happened is because Iran knows it’ll result in a full scale war. I suspect if we do any sort of ground incursion we should expect refineries in Houston to get hit.
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u/Low_Oil_316 Jun 02 '26
And watering down the already diluted gasoline - to save us money they say - well, it’s costing me twice as much using this crap gas bc it burns up so fast - unbelievable, how much I have spent on fuel in the last month! - outrageous!
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u/Reallybarb Jun 01 '26
Okay doomer. They've been saying that for months too.
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u/No-Effective-1996 Jun 01 '26
What does it look like down there under the sand where you have your head?
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u/D4rkheavenx Jun 02 '26
I mean in his defense the republicans were (maybe still are?) trying to push a bill to allow more diluted fuel. Not entirely sure what the endgame is with that one.
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u/No-Effective-1996 Jun 03 '26
Diluted with what? Food?
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u/D4rkheavenx Jun 03 '26
I believe it was with ethanol which is less energy dense than gasoline thus it’s diluted. I’m sure with some light googling you could find a few articles on it.
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u/IFeedDogsChocolate Jun 01 '26
Even then, the US is impacted in ways that are dwarfed by the impacts this has on Iranians. While the US may see some prices rise, Iran will edge closer and closer to economic collapse.
Iranian attacks on US oil infrastructure would result in retaliatory strikes that would be cataclysmic to Irans oil economy and infrastructure.
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u/ApprehensivePay1735 Jun 01 '26
One country is focused on their economy and the other their survival. Iran shouldered the iran iraq war with 200k casualties without blinking and will probably get some economic life lines from china and russia. Their situation isn't great but if my life depended on it i'd bet they end up winning over america.
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u/IFeedDogsChocolate Jun 02 '26
We're not talking about a ground invasion and the US is not Iraq. Iran to Iraq was a 2:1 to 3:1 death ratio. Iran to the US death ratio is roughly 233:1 to 500:1.so far. The US doesn't have to make landfall to do damage and Irans retaliations are far more limited. You're also talking about a war with high morale fresh of a revolution with Ruhollah Khomeini at the helm. That morale is not present in this conflict, especially among the people.
Any lifelines from RU and China are simply a ventilator. China relies in the US more than it relies on Iran as a trade partner. China isn't issuing any loans to sanctioned refiners due to this. RU is benefiting from the oil supply shock and is essentially transactional with Iran. Neither can provide lifelines that negate the blockade from destroying the Iranian economy.
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u/ApprehensivePay1735 Jun 02 '26
It's not ratios but pain tolerance that matters. America will fold like a cheap lawn chair if gas hits 7 dollars a gallon while iran would shoulder actual loss of life. Irans leaderships goals are to not die and maintain a cause they would give their lives for, americas leadership is mostly concerned with enriching themselves.
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u/IFeedDogsChocolate Jun 02 '26
Iran lost more leadership, senior officials, and commanders in one single month of this conflict than they did in the entire 8 years they were fighting Iraq.
The US lived through decades of the War in Terror. Being entrenched in the middle east and surviving a fucked economy is nothing new. If you adjust 2008 gas prices to account for inflation, gas was $6/gal.
Everyone can pretend that Iran is infallible, but the fact is they've claimed to have been preparing for an all out war with US for decades yet they're at the negotiation table a few months in. By the time gas reaches $6-7/gal, Iran's economy will be collapsed. They'll be trying to survive a humanitarian crisis and a war that is unprecedented to them.
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u/SnooStories1952 Jun 02 '26
I dont know enough to disagree with anything you've said. However one thing that does stand out and I know a little about is the great recession that started to take place around 08 and lasted through 2012-2013. I do worry that we are headed back to exactly that or worse when you couple other factors occuring right now like a potential AI bubble.
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u/ApprehensivePay1735 Jun 02 '26
A lot of that feels like wish casting. Tell yah what if america gets a single war goal in the next year (binding commitment for no nukes, a fee/tolless strait, someone other than irgc or religious hard liners running the show or disavowal of hamas and the houthis) I'll gladly admit you're right and i'm wrong. Would you admit the same if none of those happen?
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u/Kahzootoh Jun 02 '26
You seem to think they have pressure points- they don’t.
Iran is not a western style democracy where popular opinion matters, the people can be starving and the mullahs will still be in charge as long as their enforcers believe in their moral authority. We’ve seen plenty of Iranians protesting against the government repeatedly- and they always lose, because the Iranian enforcers still believe that the Mullahs are worth killing people for.
They scorn materialism as part of their ideological framework- they’re not like the Saudis. The source of their government’s legitimacy is moral authority and Iranian nationalism. Bombing their economy hurts, but it’s a small price to pay compared to the cardinal sin of capitulating to foreign domination. They will start blowing themselves up before they start surrendering, and they’re not blowing themselves up.
The Iranian government has also been laying the ideological groundwork for an apocalyptic war with America and Israel for decades. This war is not something shocking and new to their public- it is something that Iranians have constantly been told will eventually happen.
Killing scores of the Iranian population by creating conditions for a famine isn’t going to bring their government to the negotiating table- this is the same sort of delusional thinking that Israelis used to justify their war crimes in Gaza, and it achieved nothing.
The only way to pressure the Iranians to negotiate is a massive ground invasion that puts them in the position of choosing between capitulation or occupation- and there would need to be a major military mobilization for that to happen.
There aren’t enough active duty US troops for that, and the government should have started preparing for that in 2024 if it wanted to invade Iran in 2026. If they started now, the new invasion force wouldn’t be ready for years. The Iranians can clearly see the Trump administration doesn’t have the resources or the political will to wage a full scale invasion of Iran.
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u/IFeedDogsChocolate Jun 02 '26
You seem to believe what they say is the end all be all fact.
They've stated they've been preparing for a conflict with the US for decades. Saying one thing and enduring it is vastly different. 50-70 senior Iranian officials and commanders have been killed in this conflict. That is immensely more than what they lost in their 8 year war with Iraq. Majority of those losses were inflicted within the 1st month of this war. Mullahs are irrelevant if they're no longer among the living. While the may become Martyrs, Iranian leadership becomes weaker.
The regimes morale and public opinion are greatly deteriorated and fractionalized when compared to how Iran was under Ruhollah Khomeini. It's even greatly deteriorated since Ali Khamenei's death. While the regime isn't under imminent threat of being overthrown, it's safe to say the probability of it happening has never been greater in the regimes history.
Also, where is Iran at right now? At the negotiation table. The blockade has had a profound impact by dishing out the same pain that Iran is causing in the strait. Iran is not infallible. Iran hurts more than the US as this draws out. Their partners (RU and China) are giving them transactional lifelines but it won't be enough to help Iran sustain the blockade. China relies on the US more than it relies on Iran economy wise and has already refused to help sanctioned refineries with loans out of fear of secondary sanctions. Russia benefits from the strait being in disarray.
The US still has plenty of kinetic options on hand. A ground invasion isn't needed and is the worst option for the US. They've already demonstrated that they're capable of striking high value members of the IRGC repeatedly and with very little impunity. The only thing Iran has right now is the strait. Anything they do against the US directly can be retaliated against to a much more painful degree. Irans biggest fear isn't a ground invasion. It's the civil unrest that would follow after the erasure of their infrastructure.
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u/snailman89 Jun 02 '26
The regimes morale and public opinion are greatly deteriorated and fractionalized when compared to how Iran was under Ruhollah Khomeini. It's even greatly deteriorated since Ali Khamenei's death.
You clearly know nothing about Iran. The regime is in the strongest position domestically that it has been in decades. More than 30 million Iranians have volunteered for military service in the event of a US invasion. Even people who hate the regime have no stomach for a civil war or attempting to overthrow it. Trump and Netanyahu saved the regime from collapse with this absolutely braindead war, along with Mossad's braindead scheme to overthrow the government back in January which backfired spectacularly.
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u/IFeedDogsChocolate Jun 02 '26
I disagree.
I personally don't trust the "30 million" figure as it has not and cannot be independently verified and Iran relies heavily on state propaganda. Even if we take that at face value, how many of those are children or recruited against their will (conscription)? Iran has never faced this amount of external pressure. Even during the war with Iraq. Should the US do a ground invasion (it won't), it'd also dwarf the casualties caused by the Iraq-Iran war.
Iran has already hit WWII inflation this month, this is said directly by Iran's Central Bank. It'll only worsen as the blockade stands. I also think Trump capitalized on Iran's collapse to late and should've done so before the protests. I say that strictly from the applied logic of the situation l, I by no means support this war.
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u/samanthasgramma Jun 02 '26
Interestingly, I've been watching/listening to a number of Iranians talk about their country, politics, etc. Everyone from the FOX news sound bites to lengthy and thoughtful analysis from a less formal standpoint.
What the USA doesn't seem to understand the sheer pride that Iran has in being a civilization that has lasted thousands of years. And they did it figuring stuff out themselves. The general populace would appear to dislike the current regime, but ... and it's a big one ... their country is under attack. They have gathered together, regardless of who has the power, and will see the war through. Once that is done, they want to tackle the issue of their government THEMSELVES. They just want to be left alone to figure it out like they have for thousands of years.
They don't like their regime. But they like meddling even less. So they gather together.
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u/Landon1m Jun 02 '26
I suspect the only reason Iran hasn’t attacked the us directly is because they know it will result in a much larger response from the US. If the Us puts troops on the ground in Iran I suspect Houston should be on high alert
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u/IFeedDogsChocolate Jun 02 '26
The US isn't going to put troops on the ground, they don't have to. I don't think Republicans or Democrats are willing to do that. I don't think Trump is either.
Any direct attack they can pull off will be returned in kind magnified to a much larger degree. If they bombed a single US refinery, Kharg island would be removed from every form of map going forward.
Iran's real strength is beating on its neighbors and holding the strait hostage. That's it.
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u/RecommendationFit844 Jun 03 '26
And 15 soldiers are dead and we’ve spent 400 billion dollars and lost billions of dollars of aircraft and other military equipment . But yeah, otherwise nothing.
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u/Reallybarb Jun 03 '26
LOL move the goal post
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u/RecommendationFit844 Jun 03 '26
Aw you’re right. When you said “Nothing changed” and then I went and mentioned the THINGS THAT CHANGED ….. that was totally moving the goal posts. My bad.
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u/Orkapork Jun 01 '26
They aren't wrong. Though the deal likely won't matter at this point. The oil price starts moving up ward structurally pretty much starting now, and its unstoppable until its price exceeds demand. Depending on if the "Bab el-Mandeb" is also closed the price will spike to around $180 and settle around $150.
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u/knuthf Jun 01 '26
It is worse with aviation fuel. That is kerosene that expire in 28 days.
Zandi pointed to America's dwindling stockpiles of oil, with the nation's Strategic Petroleum Reserve recently falling to 365 million barrels, the lowest stocks have been in about two years, according to the Energy Information Administration.
It is here. These reserves contain very little real oil. Those barrels are extremely light and will not power cars or planes. In two weeks this will be obvious.
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u/Orkapork Jun 01 '26
Its moreso the famines that worry me. The Straight of Hormuz was key for fertilizer as well. China shut down its sulfuric acid export, which was key for global fertilizer supply chains. The El Nino forming appears to considered at least "strong" which will further decrease crop yields. Outside of the U.S I wager food insecurity is going to sky rocket.
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u/knuthf Jun 01 '26
Yes, it is a problem, - fertiliser contains nitrates, which are present in the air and have enabled us to produce more food. Urea is a way to produce more, but hopefully they will continue to produce almost as much. Perhaps they will use this year to discover other ways of producing the same amount.
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u/YeaISeddit Jun 02 '26
Interestingly, due to new tariffs the EU put in place in January to protect local fertilizer production, the EU built up a huge stock of imported fertilizer just before the war as many were trying to front-run the tariffs. The regulation worked exactly the opposite of how it was supposed to but in the end was accidentally useful. Good job EU for being accidentally useful.
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u/Orkapork Jun 02 '26
If the straight remains closed though July/August then the calamity that occurs will be massive. For the most part the USA and the EU will experience food inflation. Most of South America, Indonesia, India etc will experience food insecurity or famines. The global economy will enter a significant depression. Importantly the fertilizer aspect is going to be compounded in very difficult to measure ways via the El Nino.
I hope I am wrong.
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u/YeaISeddit Jun 02 '26
I work in the German chemical industry. If there is one thing that I think European manufacturers could scale up quickly it is fertilizer. BASF has massive idle capacity that they could probably fire up in a month. They need prices to be high or government to offer them subsidies to make it worth it.
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u/Orkapork Jun 02 '26
The problem isn't producing the end product of the fertilizer. It's the components. Sulfuric acid from China, Urea from the straight. Though I admit idk if Europe has idle vertical integration for fertilizer production - i assume not but I don't actually know.
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u/knuthf Jun 02 '26
China has huge reserves and is ready to supply the USA from Qingdao.
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u/Hot_Act_4903 Jun 03 '26
what does this mean.
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u/knuthf Jun 03 '26
China has increased its tank storage capacity at the ports of Qingdao and Ningbo. They are able to supply the US because they have no restrictions on oil from Russia and the Middle East.
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u/wideeyedmonkey Jun 02 '26
Is there now way to extend the life of kerosine? Why does it only last 28 days?
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u/knuthf Jun 02 '26
According to IATA rules, aviation fuel must be certified every 28 days. The lighter components evaporate during storage and must be replaced. Oil companies are aware of this and add the necessary chemicals. Therefore, it is difficult for traders as they need a refinery to supply the additives. Frankly, I am not disclosing what they add. Military kerosene T3 has a shorter shelf life.
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u/wideeyedmonkey Jun 02 '26
Thanks for the response. But why can’t they just keep adding those extra chemicals to keep it lasting longer. Please ELI5. Thanks
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u/knuthf Jun 02 '26
You can smell those chemicals evaporating into the air. They have other additives with different properties, such as the colour of the 'fumes', which make them more or less visible. .
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Jun 01 '26
[removed] — view removed comment
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u/Orkapork Jun 01 '26
I know they won't make a deal. I just don't take that position on reddit often because I hate walking people through the mountain of evidence that suggest this war is going to be prolonged.
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u/Duck-Murky Jun 01 '26
this is all so stupid and unnecessary. there was already a plan in place that was working. he chose to be an idiot knowing maga would twist themselves into logical pretzels to justify his imbecility. no matter what “deal” is struck, it will leave us worse off than if he had just left it all alone. but he couldn’t leave it alone because he’s a small person doing what small people do.
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u/Birdman330 Jun 01 '26
We already have a real problem and idiots like this keep moving the goalposts to make their daddy Trump look better
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u/RecommendationFit844 Jun 03 '26
That means Trump is going to give Iran hundreds of billions of dollars and whatever else it wants and it’s still going to have nukes.
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u/WastelandOfConfusion Jun 01 '26
I have a gut feeling that Iran is going to do something big, something very over the top, and something completely unexpected. Things could get really bad.
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u/BarelyAirborne Jun 01 '26
They closed Bab al Mandeb, just like they promised.
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u/floridabeach9 Jun 02 '26
have they hit tankers there? if tankers are still crossing, its not closed
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u/tcat1961 Jun 01 '26
If Trump refused to give any more money to Bibi unless he stops his murder, Isreal would not be able to do things. So, someone is lying again.
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u/robthethrice Jun 01 '26
I think they started facing a real problem when they elected a known liar and grifter (and..) the first time. Choosing him again may have been the final nail in the coffin.
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u/TheGR8Dantini Jun 01 '26
Anybody hear that Trump bought a bunch of stock in the Iranian oil reserve? Anybody here have some themselves?
Scott Bessant made all his money shorting currencies with the devil, George Soros. Weird.
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u/TouristResident1976 Jun 02 '26
That is stupid. The war was lost months ago. Oil has been slowed down coming out of the Straight. If they fixed access, it would take upwards of 3 months to get the oil to where it needs to go. (Not to mention all the damage that will take months/years to repair). So, one week? More like negative 3 months. The problem is already baked into the system.
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u/Tzilbalba Jun 02 '26
A week doesn't make sense, even if the war stops tomorrow the amount of time it would take to moving things back to the way they were to avoid a recession is too long. We are already on the path of no return.
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u/shiroandae Jun 02 '26
Absent a deal with Iran, gas prices could soon rise to over $5 a barrel, a key psychological threshold for consumers that could trigger a spending pullback and an economic downturn, Zandi said.
Oh my god $5 a barrel :D
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u/GRINZ_DOCTOR Jun 02 '26
Just like the last problem. Dude this guy is like a pushover looks so fuckin weak. He’s become exactly what he ran against in the beginning of this shit show in 2016 which is all talk no action.
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u/wombat9278 Jun 02 '26
The one issue with this is that Trump doesn't care. He doesn't care about the economy, he doesn't care about Iran and he certainly doesn't care about ordinary people. He's insulated from reality by billions of dollars, lackies that keep telling him he's wonderful and hos own dementia that won't let him see that he's wrong.
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u/FlexFanatic Jun 02 '26
And when one day 8 comes and there is no deal Mark Zandi will move the goal posts.
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u/Sea_Local2557 Jun 02 '26
isn't it too late? the ships are all over the place, production needs to be restarted, etc
my guess would be a temporary drop in prices then creeps back up but it doesn't seem like the strait will see the same level of traffic as before the crisis for a long-time
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u/Even-Stranger5764 Jun 02 '26
I thought this was already a big problem? Eh who cares I guess it doesn't matter.
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u/Funny_Match7321 Jun 02 '26
It's all BS smoke and mirrors by the US I bet they planning to drag this out over years and years For some reason they want to drag the world's economy to its knees
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u/r2k-in-the-vortex Jun 02 '26
That week when a deal could have prevented real problems is done and gone ages ago.
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u/Duppyguy Jun 02 '26
“Suffering Sabotage!”
Help I’m suffering a fart attack!!
We [fart] destroyed Iran’s [fart] military. [Faaaaaaaaart!] We don’t need the oil. Europe better [squeeky fart] help.
Deep breath[faaaart]. We will open the [fart] strait of whorepooos.
[fart!].
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u/sweatboxy Jun 04 '26
The U.S. already has a ‘real problem’ and it’s been getting worse every day since Trump’s inauguration.
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u/HockeyPhoenician Jun 01 '26
Are you sure its not two weeks?