Transcription
There is some information that we want to update you on today. It is considered interesting information because previously, many research institutions had analyzed it regarding oil. Everyone already knows that because the Strait of Hormuz is closed, ships cannot pass 100%. This affects the price of circulating oil, as well as the transportation of various goods. However, oil in the Strait of Hormuz is the main heart of it. And one interesting point is that they say that currently, various countries are using oil from their reserves. Reserves must be continuously prepared, refilled continuously, refilled continuously. But the problem is that what is being refilled as reserves is not really entering because it is lost there, at Hormuz. 20% of what we need to use daily. So it depletes, depletes over time. They have estimated that the danger zone for oil prices, which might lead to the use of reserves, is June, if the war has not ended. And if the war and Hormuz continue to be closed for longer, it might reach a critical level between September and December 2026. Don't forget that currently, the reason stock markets are falling and even gold is dropping is due to concerns that the Fed, the US central bank, which will have a meeting next week, might signal an interest rate hike this year because the US economy is also hot, and inflation is also hot. Therefore, there is no reason to lower interest rates. Is it possible that they might raise interest rates to curb inflation first? Today, we will analyze this. And we have a very suitable person because in the past, he was a Deputy Prime Minister, he was a former Deputy Governor of the Bank of Thailand, and he was also the Minister of Finance. That is Khun Teerachai Phuvanatnaranubal. Today, Khun Teerachai will analyze for us what this critical level is that will be reached between September and December. Some people might say it won't go that far, maybe the war. But Khun Tee says it's not certain, it might end in July. What will happen? Khun Tee is with us now. Hello, Khun Naw.
Hello, Khun Tee. Today, we must ask Khun Tee to analyze for us. Because since the negotiations between Iran and the United States stopped in April, oh my, today is heated. Because coincidentally, a US spy plane crashed, so they thought Iran probably shot it down, so they bombed Iran. Iran, which previously attacked, attacked the US Fifth Fleet in Bahrain. Now, the problem is that if we look back at the data, they say that around June, it starts to become a danger zone because of oil reserves. If it drags on, Khun Tee, you have made this observation, it will be dangerous in terms of reaching a critical level sooner than September. What do you think about this situation, Khun Tee?
Originally, I was rooting for it, hoping that the deal between the US and Iran would end.
Because as an economist, I am confident that the whole world is rooting for it to end quickly. Because if it doesn't end, the risk to oil prices and the global economy is very high. Now, the problem is like this. Donald Trump, honestly, in my opinion, his bargaining power is low right now, but he sees himself as having high bargaining power. Therefore, he will set many conditions.
This makes the negotiation difficult to end. And Trump uses the same principle: to pressure Iran economically. He says that now he is blocking it. It is a double blockade for Iran, which prevents Iran from exporting, prevents it from selling oil. Income from oil is now, let's say, non-existent. There is also a problem, which I originally thought would be a big problem, which is the oil wells themselves. Especially Iran's oil wells, they are very old, 60-70 years old.
Yes.
Because they are oil wells where investment and technology are old. Therefore, the pressure inside the well, inside the pipe, is already low. Now, if it has to stop, groundwater will flow in, it will seep in quickly. The longer it stops, the more it seeps in, and the chance that those oil wells will be lost forever, completely lost, is high. You can only pump out water, or water mixed with oil until it's not worth separating. Originally, I thought Trump saw this as a point to pressure Iran. So he pretended to negotiate and released news that it was about to end, about to end. But honestly, I think he wants to get through this process of making Iran have no income. But on the other hand, what is happening in parallel is that Iran also has a card to pressure the US. As Khun Naw mentioned, it is the world oil price. We can divide it into two markets: the spot market, which is for today's delivery, and the futures market for next month, the following month, the month after that. That is called the futures market.
Yes.
We will find that the spot price is very high. For example, the spot price at some points has risen to $140-$145. But the futures price has risen to its highest at only $100, not even $120. Therefore, there is concern, people are questioning why this is happening. Part of it is from Trump himself. He comes out and speaks, then negotiates, saying it's about to end, 95% done, this and that. This has caused the oil price in the futures market to not yet reflect the spot oil price as much as it should. But I will point out that a problem is about to arise. Now, the problem in the negotiation strategy between the US and Iran, where each side thinks they have a high card, is that Israel has intervened. Deep down, analysts worldwide see that Netanyahu does not want the war to end because he is being sued. And he wants the upcoming election in Israel in October to be in a state of ongoing conflict. In most countries, if an election is held during a state of semi-war, there will be a portion of the public who lean towards the leader at that time. It's like, at least, they know that the leader can protect them. In this regard, Netanyahu hopes for this.
Yes.
So he makes his move, plays his game, to make the negotiations between the US and Iran go back and forth. And then Lebanon comes into play. Simply put, Israel sent planes and intensified its military operations in southern Lebanon. And the planes that went in to bomb were not just in the south, but even up to Beirut, the capital of Lebanon. Now, Iran has announced that this negotiation, this agreement with the US, this war, must end together. If the war in Iran ends, the war in Lebanon must also end, right? They came out like this. Netanyahu knows. Ah, if so, the way he can stop the negotiation from ending is by sending planes and bombing deeper and deeper until at one point, he announced that the citizens of Lebanon living in Beirut, the capital, in the south...
You can move out now. Simply put, give them time to move out because we are going to bomb. By doing this, it is a show of force. Because if they say they are going in to destroy, to eliminate, to kill Hezbollah leaders, and announce it in advance like this, the leaders, the soldiers, the fighters will also move out. It means that when they go, they will destroy, like in Gaza, in Palestine. When they go, the buildings, houses will be flattened. There will only be piles of concrete everywhere. And people will have nowhere to live, they will become refugees, just like what happened in Gaza. Iran has announced that if Israel attacks, if they warn the Lebanese to move out of Beirut, Iran warns the Israelis in the north, specifically in the north, bordering Lebanon, to move out of their homes now. They are warning that if you attack here, Iran will also attack back, even though it is a defensive attack. In the end, the jet sent planes and bombed Beirut. Indeed, Iran sent missiles to northern Israel. Indeed. Israel showed its power by sending planes and bombing important targets in Iran. It turned out that Iran fired missiles into Israel, into big cities, around Haifa, around the base, something like that. In conclusion, the negotiation process, which seemed quiet, suddenly became chaotic. Trump couldn't stand it. Before this, Netanyahu ordered an attack on Lebanon. Trump called him, and someone leaked Trump's words to the media. Trump used vulgar language, harsh language towards Netanyahu, to tell him not to invade again. It turned out that even though Trump said that, he still invaded, right? So, in the end, Trump finally ordered Netanyahu to stop and told Iran that you don't have to attack Israel anymore, Israel has stopped.
Mmm.
It's like this. If I were an Iranian executive, I would have to weigh it. Oh, this matter, the Strait of Hormuz that I control, is worth more than I thought. It's not that I can protect my own interests, I can also protect Hezbollah's interests in Lebanon.
That's why I'm watching the situation. It turns out that Iran is not eager to negotiate to set more conditions.
Originally, the conditions were that the US froze the money. The US said from the beginning, Trump said they would not return it. Because he criticized, if I remember correctly, during Biden's time, he allowed some money to be returned. Trump complained. In the end, the returned money was frozen. So, in this situation, Iran knows that Trump will never agree. Trump clearly announced that he will not agree. But I see it as setting conditions. The negotiation, which Trump originally said would end this week, this week. It's already Wednesday. I don't think it will end.
And looking at the situation from now on, I think Iran will not give in easily. Therefore, I think Iran is now turning the tables. It turns out that what Trump hoped to pressure Iran with, that they have no income because they cannot have income, cannot export oil, this might still be manageable. But within June, the oil price might become chaotic. I sent a graph for you to look at. I have graph number 5. This is clear.
This yellow line is what they call the Stress Level. And they calculated that it will happen in June. This calculation was done by JP Morgan and Kpler, who are experts in the oil business.
Yes.
This yellow line reaches within June. This means that within June, perhaps from mid-month onwards, oil refineries will not be idle. If they see that the negotiation is not ending, they will start competing on prices. When they compete on prices, it will become very chaotic. Let's look at the next graph that I sent. This shows the latest week. We can see that the rightmost column is like this. What is missing from the Strait of Hormuz, roughly estimated at 20 million barrels per day. Currently, there is a compensation of about 17.5. The rightmost column, 17.5. 7.5 comes from the oil pipeline of Saudi Arabia. This is above, that is not going anywhere. But 3.75 comes from China. In the past, China sat on its hands, refused to bid because the price was high. China played a deep game, bought and stocked a lot. Therefore, in the past, they did not compete on price, which kept the price low. This 3.75, from now on, it's uncertain. I think when the time comes, China, when its stock depletes to a certain point, will start competing. The next line, this is the export of oil from the United States, which has been supplying the market all along, 1.75. And Khun Naw, this export of 1.75 million barrels per day is not from increased production.
Mmm.
It's from stock, from existing oil reserves. Therefore, it is running out. And when it runs out, besides there being no more exports from stock, I am guessing that by June, Trump will order a ban on exports. This third line might disappear completely.
The fourth line is the SPR, which is the emergency reserve of the United States and the world, which has been released. But this is mainly from the United States, 1.5 million barrels per day. Emergency reserves will probably last if they continue. Currently, the first program is almost complete. But they cannot release more because it is stored in these old salt mines. After they bring the oil up, originally I thought they would just lower a pipe like a straw and suck it up. They don't do that. They inject fresh water. When fresh water enters, it pushes the oil up. This fresh water, when it enters in large quantities, will cause the walls of the salt mine to dissolve. So there will be a problem. What I want you to look at is the second to last line, which is Demand Destruction. This is from compensation, from reduced consumption. Currently, it is happening very little, only 3 million barrels per day. Therefore, looking at this, it is clear that by the end of June, the latter half of June, and into July and August, oh, I think the situation will be severe. Oil prices will rise. I think they will rise to the level of $120-$130 for Brent, easily. And let's look at another slide that I sent.
This is slide 7, I think. It will be clear. Slide 8 is this one. The rule of thumb of the IMF. They say that if oil prices rise by 10% and stay there for a long time, 10%, it will reduce global GDP by 0.15-0.2. This is a significant reduction. And at the same time, besides reducing in this way, it also causes inflation, a kind of stagflation. Inflation will increase to about 4% per year. Therefore, here, here, I think the situation of negotiation, you can take the slide down now. The situation of negotiation in the Iran-US war, I think it is reaching a turning point.
Mmm.
A turning point for the worse for countries, for the whole world, for the global economy.
Yes.
And what I think is most frightening is that I am concerned that the Thai government has not yet shown its vision on how it will manage this.
Mmm, yes. Khun Tee, there is a meeting scheduled for the Fed on the 16th and 17th. Oh, I don't know if there will be a breakdown this week. Because Khun Tee said that in mid-June, if the war is not over, refineries might have to adjust their production capacity, adjust prices again. The 16th and 17th will be a deadline, which will be related to energy, inflation, and interest rates. What do you assess the Fed's stance to be, Khun Tee?
This will have to be a guess. This will be the first decision of the new chairman, right? And they will have to come out. Therefore, I think people will be watching this program closely, listening to every word, to see their direction, their trend, whether they will be hawkish or dovish. I am confident that they will show a neutral stance.
Mmm.
Simply put, the oil price by the time they have the meeting will not have risen to a frightening level yet. Therefore, I think they can remain neutral. But looking ahead, if any investor dreamed that the Fed would lower interest rates, they can forget it now. There is no chance of lowering them. It's only whether they will raise them or not, or how they will manage the market.
But if there is a slight signal of a hike, Khun Tee, oh my, will the stock market fall a lot? Will assets fall a lot?
It's like this. The stock market this week and next week, I think it's very scary. There's a problem because there's the SpaceX IPO.
This Friday.
Very large volume, very large volume. And the way they sell, the proportion of the volume they open for sale is small. Therefore, they are selling to push up the price. But for people to buy it, it means we have to sell something else. Another thing is this. The Nasdaq is preparing to adjust the rules for stocks to be included in the index. The top 100 stocks. Of course, SpaceX will be included. It's just that originally, they set conditions, oh, it takes months. This is not the case, only 15 days. It can be included. Therefore, 15 days from now, 15 days from the 12th, which is the 20th. It must be a business day, right? SpaceX will be included in the index.
Now that SpaceX is included in the index, Khun Naw, it means that everyone who manages pension funds, other funds, which are benchmarked to the Nasdaq index, must buy.
Mmm.
Of course. Therefore, looking at it this way, it means that everyone, no matter what, must try to buy today. And how? When buying SpaceX, they have to sell something else, right? Because in management, they will use the benchmark as the main reference. Therefore, if the benchmark consists of stocks 1, 2, 3, A, B, C, D, in what proportion, the manager, in principle, must adjust their portfolio to be close to the benchmark first. After that, they can decide whether this stock will be overweight or underweight, and by how much. This is a technical method of managing large portfolios. Therefore, I repeat, suddenly a new stock comes in. They have to clear out some old stocks. This will cause the market to ripple. And I think it will drain a huge amount of liquidity from the market. Therefore, the stock market, within this week, the 12th, Friday, and next week, I think it will still be in a downtrend. It might fall sharply, and after that, it might bounce back. Because by then, people will have already targeted it. Because no matter what, they have to support the market because there will be OpenAI, and this is coming. In terms of the impact on the stock market, I think if I have to guess, I think the Fed will probably, if I were the Fed, I would still do nothing. In terms of interest rates, I would keep them neutral. And perhaps keep them neutral for several more months. I will watch the situation of oil prices, the Trump-Iran situation, and the stock market. And if, looking at the situation, suppose oil prices rise significantly, instead of raising, I guess they will switch to what they call curve control. Print money, but not lower interest rates. Print money to buy long-term government bonds, buy from the market, buy 10-year, 30-year bonds, to keep long-term interest rates from rising too high. If I were the Fed, I would do this.
Mmm. Khun Tee, what about US inflation, which rose to 3.8% two months ago, in March and April? We have to see May again. If it rises like this, oh my, it's a bad sign. And the war is still not over. So, the chance of lowering interest rates this year, what do you think? Is it slim, or is it more likely to be a reduction?
Lowering interest rates is impossible. It's only whether to raise them or not. But I guess, I bet they won't raise them. If I were them, I would accept that no matter what, inflation cannot be solved because it is cost-push. So, I have to accept it until the negotiation ends and the situation is clear, then we can talk. Therefore, during that time, if I were them, I would manage long-term interest rates to allow the government to continue to borrow. This is unconventional management. But I guess they will do it because this is the Bank of Japan's formula.
So, Khun Tee, will the market feel that the Fed cannot control inflation? Of course, it will. Of course, it will make gold prices, all assets, rise. It's like this. The Fed, I think they will remain completely still. Even if inflation rises, they will do nothing. But I am guessing that the US stock market will fall significantly after these two major events, after OpenAI and SpaceX are included in the market. I guess it will be a big fall around July or August. And when it falls significantly, the Fed will have an excuse to manage long-term interest rates by printing money and managing what they call Curve Control. They will have an excuse. If it goes that way, it will gradually bring back confidence to the market. But of course, the value of the dollar will fall, and the price of real assets will fluctuate.
Yes. But the fall might not be as much as the previous rise, right, Khun Tee? Even with the dollar?
I mean stocks. US stocks.
Oh, it's like this. Stocks will keep rising because the dollar's value keeps decreasing. If we are determined to make the dollar's value less and less, stock prices will rise, right? But AI, by itself...
It's a bubble. And someone has created it. They have compared it. They say that every time there is a major technological development at a national or global level, it creates a bubble because there is over-investment. And when there is over-investment, some people who use it find that their income, their profits, are not enough, and they go bankrupt. But the structure remains. They go back to the beginning, the railroad, right? They competed fiercely, many lines went bankrupt, then consolidated. But it has remained until today. After that, there were electricity systems, they competed fiercely. And in the end, many companies went bankrupt. It's the same with cars. They trace it back. Finally, before this, it was the internet in 2000, the bubble. And many people who lost money went bankrupt. But the system remained. And now, it's AI's turn. But they say AI is concerning because the data centers have a problem. In 3-4 years, they become obsolete. It becomes...
Yes.
...obsolete. So this time, when the bubble bursts, it might be scarier than in the past.
Mmm, because it's very big.
It's very big. And they are not using strange models. Simply put, in America, it's like they are stimulating the models, saying, "You are big, you compete and win." Therefore, only 5-6 companies can truly compete.
Ah, the 5 angels, and then later, with Europe coming in, they have to have really brilliant ideas and compete in a way that whoever is good survives. But compared to AI, if you look at China's model, I see it as coming out in a way that it's not big companies competing. It turns out that with companies like C or others, it's open source, opening up the world. Whoever wants to take it and develop it, come out with specialized models that are good in this and that, and use them to do business in China. Therefore, in China, AI is intended to be distributed and widely used. And the nature of China, as a country with a low birth rate because they controlled it for so long, has led to a shortage of labor in industries. Therefore, some people say that the trend of AI development, which will become tangible, as humanoids, as robots that resemble or can work like humans, and are used in factories, will grow fastest in China because they lack people.
Mmm.
The American model, the bubble will form and burst.
Mmm, but in the end, AI is real, it's the megatrend of the world, right, Khun Tee? It's just that between selecting people.
Exactly, exactly. I use it every day. But I'm sorry, I use the free version. Because I know some things, when you ask for free, after about 10 questions, it says it's full for today. If you want to ask more, you have to wait until tomorrow, or you have to pay, right? So I don't mind. I close the chat, open a new chat.
Ask questions in a new chat, and it doesn't know. It answers again. And there are many others, like Google's Gemini, which is free all the time. I use it for free all the time. That's why I have to ask why Minister Chaiyachon is going to do AI passports, spending 1,600 million. What is he doing? There are so many free options.
Mmm, yes. Khun Tee, a moment ago you said that the world has a plan to compensate for oil, 17.5 million barrels per day. But we also see that Iran is always attacking. And before that, America also attacked Iran's infrastructure, and Iran attacked the infrastructure of the Arab Gulf. So, Khun Tee, I want to ask if this reserve plan is a plan that can actually happen? And where is the red line that makes the market know that a supply shock has truly occurred, and it's uncontrollable?
The reserve plan we just looked at, the first line, is the pipeline from Saudi Arabia, plus the figures from the UAE. This is 7.5 million barrels. If this disappears, the world oil market cannot handle it. And this pipeline, Khun Naw, do you know that Saudi Arabia's pipeline is over a thousand kilometers long and has a total of 10-11 pumping stations?
Mmm, yes.
And Iran says, simply put, they don't say it, but it's known among analysts that if America attacks, bombs Iran like before, if they come back and bomb indiscriminately, Iran will attack this.
Mmm.
And when they attacked the pipeline last time, it took 24 hours for Saudi Arabia to repair it. But imagine if Iran attacked the pumping stations, which I have seen on Google Maps, they are as big as factories.
And if they attack the pumping stations, say 5-6 stations, and there are also upstream processing plants where they have to filter the oil because the oil contains paraffins and other substances that will clog the pipes. They filter them out. And if they attack the processing plants in the city called Abqaiq, it will take at least a year to repair.
Oil prices will be out of control. Similarly, the UAE's pipeline is near the Strait of Hormuz, but the mouth of the pipeline is visible from Iran. It's right there. So Iran can attack whenever it wants. In conclusion, Iran has also announced that there are 7 underwater cables. Internet traffic for the world passes through these 7 underwater cables. 30% of the world's financial transactions, people say, pass through these cables daily, 10 trillion dollars. Iran says if this happens, Iran says you are placing it at my doorstep, so from now on, I will charge a fee. Of course, the ones who will pay are the ones with money, because the owners of these cables are giant companies. But at the same time, Iran has also announced that from now on, maintenance of these cables is under Iran's jurisdiction. And if repairs are needed, it will be by someone Iran approves. In conclusion, they will charge a toll, not just for ships, but also for digital traffic.
And when they threaten like this, if they bomb again, and they cut these cables, the American stock market will not be able to handle it.
Mmm.
This is why some people in America say, "Finish the job." Iran is like this. And there is a final move. The Arab countries, the Persian Gulf, has two sides. The Iranian side has many mountains. The other side, Saudi Arabia, Bahrain, etc., is flat and sandy, with no fresh water. The Iranian side has high mountains, so there are many streams because they trap moisture from the clouds. This side has no fresh water. How can they survive? They have factories that convert seawater into fresh water.
If they attack Iran, and Iran attacks the Arab countries, these desalination plants will be wiped out. Within 2-3 days, they will have to abandon the area. And people won't be able to live there. How can they export oil?
Therefore, I don't think America dares. After calculating, they definitely don't dare to mess around militarily. They can only do a little bit. In English, when they attack, America uses the term...
To defend themselves.
Yes, they say that. Actually, it's to pressure each side, "Hey, you, agree with me." But they don't dare to go in big.
Mmm. Oh my, if it's not big, it will drag on, Khun Tee.
That's why I see it. I can read the game. Iran, at this point, has weighed it. They know that what they have in hand, their bargaining power is very high. And if they drag it on, they have no income from oil exports, right? But they can endure long enough. They will have income from collecting tolls from both ships and cables. Oh, they can survive. Therefore, during this time...
I don't think they will give in. But on the American side, when June comes, then July, the oil price issue will be uncontrollable. Therefore, I think Iran also sees this. It's a trade-off of who can endure longer.
Mmm, yes. A moment ago, Khun Tee, you showed a picture and said that the IMF estimates that if energy prices increase by 10% and are sustained, it will push up inflation and depress the global economy. But looking at the Strait of Hormuz, oh my, hasn't it already exceeded 10%? Khun Tee, many people are afraid. What does it mean? If yes, yes, sorry. If 10%, it must be compared to the previous level of around 70. It has already exceeded it. And if it reaches $120-$125 and stays there for several months, oh, calculate it yourself. It's difficult.
The global economy will slow down significantly.
And inflation will be uncontrollable. And besides that...
And there is another problem, which I will tell you about, the air pockets.
Mmm.
For example, if they agree today, and Iran agrees, okay, let the ships carrying oil, which are currently floating, about 120-130 million barrels, leave.
They are full of oil, not carrying oil. Because Iraq, Bahrain, Kuwait, etc., when they pump it up and have nowhere to store it, they have to close the wells.
And the ships are stationary because Iran doesn't allow them to leave. If an agreement is reached and Iran allows them to leave, oh, 120 million barrels will come out. But don't forget, the world uses only a little over a day of 120 million barrels.
But if they come out...
The rest, Khun Naw, do you know that to open the wells again in Iraq, Kuwait, Bahrain, UAE, etc., it will take time?
Yes.
They have to empty the onshore tanks first. Because currently, onshore tanks are full. But to empty onshore tanks, ships are needed. Currently, if Iran says the ships can leave, the closest ones will be heading to Asia, to Thailand, or something like that. It will take a month, maybe a month and a half, to return and get the second batch of oil from the tanks. After that, they can start opening the wells. And when they open the wells, it's not like flipping a switch. The process is long. And many wells, as I said, when opened, sometimes they only get 60-70% of the previous speed, of the previous volume. Some wells get 0. All of this, people estimate roughly that it will take 6 months to return to normal. Who is going to face the problem of air pockets? Previously, we were not happy with Prime Minister Anutin's government regarding price management. They didn't take care of it. It turned out that the profit was excessive, right? Or they let the traders hoard oil and profit from the stock. We were not happy. And until now, they haven't found a solution. Looking ahead, if there's a problem, it will change from price to quantity.
Mmm.
Shortage of quantity.
It will turn out that there is no product, and how will we distribute it within the country? Oh my, how to manage this? I believe the public will not have confidence because they will believe that someone is hiding within a political party or something, and profiting from this.
All of this is going to be a problem. There will be air pockets.
Shortage, not just oil.
Mmm.
Gas, fertilizer.
And for others, globally, there is also sulfur, which is used for copper production, and silicon, which is used for semiconductor production, computer chips, aluminum. This time, the goods coming out of the Strait of Hormuz, and the problems, will affect the global economy more than past oil crises. In the past, only crude oil was blocked.
Mmm.
This time, crude oil plus refined oil, plus gas, plus gas, plus gas, and so on. And do you know that crude oil that is currently blocked, based on the numbers we saw, let's just talk about crude oil alone, roughly, they say 10 million barrels per day. The biggest oil crisis in the past, during the Arab embargo, because Israel, America supported Israel by sending oil. And then again, during the Iranian revolution, and the West stopped buying oil. Do you know that both times, oil was short by 5 million barrels each time? This time, it's 10 million barrels, which is twice the previous times. Therefore, this time, the shortage is much greater. It's just that in the past, Trump, in the past, coincidentally, the world knew that oil prices would be problematic, so they built up stocks, both government and private stocks, a lot. And this time, it's running down. It's like using up savings. But it's okay because they had savings, like savings accounts. Now, the savings are almost depleted, and it's still not resolved. Oh my, the situation is chaotic, definitely chaotic.
So, you mean that Mr. Trump has to finish it by mid-June? That is, no later than next week?
I think he wants to finish it desperately, but when there's a problem...
Yes.
Originally, there was an MOU. I thought it would work. But some people criticized it, saying it was a loss of face, a defeat. So they complained, and they decided to withdraw. But now that they have withdrawn, and each event has developed day by day, as I've told you, Iran sees that now, they are not just the boss of oil. They are also the boss of Lebanon. Soon, they will be the boss of Yemen too.
From now on, if they can still maintain power in the Middle East, America will never be able to go back. The military bases in Arab countries, they will not get budget approval from Congress to repair and rebuild. No one will give it. And I think the US military will not invest in this region again, because current technology cannot solve the problem of fighting Iran's guided missiles.
And they are stuck. Actually, Americans are not stupid. They have the technology to produce. They lack raw materials. And China refuses to send them. Before, China sent them. But now, because of the trade war with China, China has closed its doors. They will only sell for ordinary industrial production, for civilian use. For military use, they don't sell. Currently. Therefore, in this regard, America cannot establish a new power base in the Middle East again.
Mmm. Oh my, but this is strong, Khun Tee. Iran attacked Bahrain, which is the US Fifth Fleet, which is very large and powerful. They didn't just attack the fleet, the ships all fled. They attacked the command center.
Mmm, because of the news from Asia this morning that said they attacked the US Fifth Fleet.
It's not the command center, it's a symbol.
They attacked before that.
Now the ships have all fled, and the stationed soldiers have also left. They say that currently, US soldiers are in the base, maybe around the back. But in the first round, when Iran attacked, they all rented hotels. And it turned out like this. Iran, within 1 or 2 weeks, was able to destroy radar systems, round and bulky ones, each center, each point, invested more than a billion dollars. 4-5 points in the Middle East are now gone.
So these radars, in military jargon, are called blind eyes.
In the past, these radars used to detect, oh, a missile was fired from Iran. Okay, when will it arrive? They could calculate everything. Now, they are all blind. Therefore, currently, there is no power to negotiate with Iran. If Israel moves again, maybe next year, if Israel does something they don't like, they will be finished. It will be chaotic.
Mmm. And this is the remnant of Iran, right, Khun Tee?
Remnant of Iran.
Therefore, in this program, people in America, on the Israeli side, have to try to find a way to stop Iran. But I still can't see how they can stop it.
But many academics have observed that perhaps, Khun Tee, do you agree? They say that the negotiations are not ending, not being resolved, not being finalized, because Israel, the United States, cannot control Israel.
Partly, partly. But I think it's clear that in the end, Israel has to obey if the US orders it. Because all the weapons come from the US. And the financial aid also comes regularly. But still, as I said, they have to show it. Even if they agree on something, suppose, I'm guessing again, I'm guessing again. I think oil prices will rise. Oil prices, when they are tight, and there is fighting, they don't jump suddenly. They rise slowly, week by week, but they keep rising. And maybe by the end of next month, it will be clear that they can't stand it anymore. Oil prices will rise so high that even Americans themselves...
Even within the Republican party, they might demand that Trump say, "Let's stop it. Agree to it."
Because otherwise, they will lose the election completely.
Yes, we understand, we understand correctly. So, currently, the world is in a situation where oil is entering a danger zone from June. According to Khun Tee's explanation, if it's not over by June and drags on, the critical level that Khun Tee said refineries will reach between September and December might be sooner than September if it drags on longer, right?
It won't be sooner, but it won't be like this. When it reaches the stress level, that yellow line in the graph I showed earlier, it will fight fiercely. Because if I were a refinery, and it's June, and I know my supply is starting to dwindle, I have to take out all my profits and throw them on the table to compete for purchases. Therefore, refineries are the ones who buy crude oil in the world. It's not ordinary people, not general companies buying. So refineries don't want to stop, because if they stop, if they stop completely, and start again, the cost will be $3-5 per barrel. So they don't want to stop. And they want to keep their refineries running. So they will compete. What has happened so far is that the competition has been about where the oil comes from. For example, Thailand likes oil from the Middle East because it takes about a month to ship. But if they have to get oil from Nigeria, oh, it has to go around Africa. That's difficult. Oil from Saudi Arabia, if it can pass through the Red Sea, it's still a month. But if Iran closes the Red Sea and the Bab el-Mandeb Strait, using Houthi, then oil tankers leaving Saudi Arabia, if the Saudi oil terminals are not destroyed, they have to go around the Cape of Good Hope, around the Horn of Africa. It means that the process of ordering and buying for some refineries, we want to buy oil that is closer, but currently, we are not sure how much is left. Originally, I saw the government publish information about the oil that will arrive each week, looking 2-3 months ahead, how much is confirmed. They only published it once. After that, I haven't seen it again. I think this is not good. The government should publish this all the time so that the public knows and can prepare. If they know and hoard, they should be punished. But we are looking at the need to prepare to cope with the situation.
Oh, but Khun Tee, you think the ceiling we might see is $120, and it won't exceed this?
I think it might exceed it.
Oh, it will exceed it?
Yes. Let me guess, I think it will end next month, July.
Oh, yes, yes. It will take about another month to finish. The reason is that oil prices will rise so high that even Americans who previously encouraged more fighting will start to see that they have to agree, because oil prices are rising, their base will suffer, and the global economy will weaken, and the US economy will not survive.
Mmm. Oh my, if it reaches this level, America is strong, right, Khun Tee? Because their employment is so high, 170,000, exceeding market expectations by a lot. Unemployment is only 4.3%. Inflation is also coming, and the economy is strong.
Yes, just now I asked AI what would happen if oil prices rose to $120-$130. It started by saying what the IMF said about the global situation. After that, I asked it to list it country by country. China is affected, India is affected. But the US is least affected.
Least affected because they have their own oil.
Ah, they have a lot of their own oil. But their oil is light oil, which when refined, produces diesel and other products, but it's not enough. But the point to consider is that even with their own oil, they still need to import heavy oil from other sources because the refineries are designed...
They cannot refine light oil alone. Therefore, if oil prices rise globally, within 48 hours, it will be reflected in US oil prices, unless Trump decides to ban US crude oil exports. But this will further damage their reputation. Yes, Khun Tee, we are all suffering. America.
Correct. The whole world is suffering from what you did. Yes, yes. They are okay. Their workers have jobs, their economy is good. Maybe some things are more expensive, but the economy is still strong. We are here, Khun Tee. Our economy is only growing 1-2%, plus expenses are high, and there is debt.
Yes, and... Do you know that suddenly, they used to collect taxes from around the world, right? We felt it was 19% right away. After that, the court said, "No, this is not allowed. You designed the tax like this, it's unconstitutional." Now they have issued a new one, using 301.
Yes.
Oh my, but looking at the situation, it's clear they want to collect taxes like before, but they have divided it into two tiers, 10% and 12.5%.
This doesn't make sense. Trump is gone. Originally, they thought the global economy would breathe easier from the Supreme Court's decision.
It's become a slowdown again. Therefore...
Uh, uh, uh, businesses and the government need to plan well. I think the economy looking ahead is scary.
Mmm, yes, Khun Tee. Because Donald Trump has led the United States into war, costing billions a day. So they will have to collect taxes from us to compensate for what they have done in the war. We have to trade with them, I don't know what to do. We might also be taxed. We invited Khun Tee to analyze for us because, as mentioned, June is entering a danger zone, and oil is the trigger that is causing global markets to worry a lot. Because the Fed meeting is next week, and we don't know what the Fed will do about inflation, which has been rising for two months. Khun Tee said it might rise to 4% in May. This is a test. The economy is strong, growing rapidly. Inflation is also growing rapidly. We don't know if they will lower interest rates. They might have to raise them. If the situation is like this, Khun Tee, thank you very much for analyzing and helping us prepare. Don't panic, but be aware, as Khun Tee said, be aware that there are risks waiting. If assets fall sharply, those with savings can decide whether to retreat or buy. If assets fall, thank you very much. Thank you. Goodbye.
Yes, okay. Goodbye.
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