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Last time, it was clear that it was a delay tactic. But what I see behind it >> is very clear. It's that they have controlled their risk factors. The main ones are oil prices, inflation, and interest rates. Simply put, once they can control these, they become more aggressive, to put it in layman's terms. >> It's like now, like it is now. But suppose it goes back to 120 again, I wonder if that's the case, if oil is 120 or more, would Mr. Trump still insist on this? [Music] Right now, it's actually at an inflection point, a very delicate point. I don't know how to translate it. In Thai, it would probably be translated like that. Delicate. >> It's like, I'm not sure how it will turn out. How do we know? Just look at inflation. The latest inflation figures are around 3.7, plus or minus, right? If we are confident that inflation will be suppressed, pushed down, and controlled, as the Fed often claims. [Music] The Fed's interest rates must be equal to or higher. Therefore, if inflation is 3.7, as recently reported, and it's linked to oil, it should be around 80-90 dollars. The question is, where is oil today? It's already exceeded that. If oil goes up to 100 dollars and stays there, even just 100 dollars, in VTI, you can bet that in another 2 months, VTI will definitely rise to over 4%. And once it's over 4%, then it will come back full circle again. Vis cycle. But >> So, in the past, Mr. Trump signing the MOU and having various agreements with Iran, was it an intention to end the war, or just a tactic? [Music] To buy time, to add a buffer, to give the United States a chance to re-engage in a new round of conflict. Our goal is to take this channel to 1 million subscribers. Please subscribe. We now have YouTube Membership. By subscribing, you will receive exclusive content and seminars from PR KP and Team Business Tomorrow. The oil price is now 96 dollars. What are the chances of reaching 100 dollars, the peak we saw about 2 months ago, 120 dollars or more? >> I think the chance is higher this time than last time. Last time refers to when the war first ended on February 28th. The next round, I think it will be in August, or possibly within this month. It's possible it will exceed 120. It's possible, if the war doesn't end. Because why? Because the supporting factors from last time have largely disappeared. And in the next round, there will be 3 supporting factors that used to suppress oil prices. The first is China, which has reduced its imports by about 4 million barrels per day. That's a lot. 4 million barrels. If you consider this as a percentage of the world, it's 4%. In simple terms, the factors that prevented oil prices from going too high in the past came from China. That's the first one, which I think might have decreased significantly. The second is the various inventories around the world that have been released, bringing levels down, especially in the US. Currently, if you follow the Strategic Reserve, it's low. And the last one is the supply that might decrease further due to the closure of two straits. If they are closed, it will be different from last time, right? Last time, both straits were not closed simultaneously. Last time refers to 3 months ago, until a month ago, and then started again. Now, right? This must be called the second round. To answer briefly, there is a chance it will go beyond 120 in the next round. >> But P'Moo, from studying the energy market, we've discussed in the past, P'Moo would look at the dimension of demand that might decrease, or the ample supply in the global market. This time, P'Moo is back saying oil prices will rise significantly. Has anything changed in the facts of this war, P'Moo? >> Actually, the facts, I think it depends mainly on the US or Trump. If you observe, I've always said that oil prices don't easily reach 200 because of the US. Because the US fears inflation, which would push down the stock market and push up bond yields, right? I'll briefly go back to what we discussed. And rising interest rates will have negative consequences for the US economy, the US bond market, the real estate market, and the stock market. And it might lead to interest rates rising quickly and significantly. How much and how fast? As I've said many times, right now, it's at an inflection point, a very delicate point. I don't know how to translate it. In Thai, it would probably be translated like that. Delicate. >> Yes. >> It's like, I'm not sure how it will turn out. How do we know? Just look at inflation. The latest inflation figures are around 3.7, plus or minus, right? Whether we look at CPI or PCE, it has decreased from 4.3, right? But it's similar to the Fed Funds Rate. The rate we often look at is now around 3.7%. So, it means that today, they are equal. What does it mean if they are equal? It means that if we are confident that inflation will be suppressed, pushed down, and controlled, as the Fed often claims, the Fed's interest rates must be equal to or higher. Actually, it should be higher than equal, otherwise it might not be enough. Therefore, if inflation is 3.7, as recently reported, 3.77% for the latest month, and it's linked to oil, it should be around 80-90 dollars. The question is, where is oil today? It's already exceeded that. But it has just exceeded it, right? So, we need to look at the average. This means that if the average exceeds 90-something dollars, then inflation has a chance to rise again, trending upwards after just falling for one month. And if it rises again from 3.77%, it will be a crucial point to indicate or make us more confident that we don't need to worry about what the DP thinks or the market's probability. You don't need to look at the market. The market changes all the time. But what you should look at more is if inflation has a chance to rise from 3.77%, which is the same level as the Fed's interest rate. When it goes higher, and last month it was higher than 4.3, right? It was 3.77%. Notice that? And why did Mr. Trump have to delay for a month? Why delay for a month? Why delay first, before coming back? Notice that it's because he controlled all the risk variables. For example, he knew that inflation would definitely fall because oil prices dropped from over 100 dollars to 70 dollars. This would affect CDI. Second, bond yields also fell. Third, the economic figures that came out were not bad. So, in simple terms, Mr. Trump had room to maneuver to announce the war again. It might be a strategy that, once he controls his risk factors, at least for a while, he has room to breathe. Now, let's try again with Iran. This time, the strategy might change. You see now, they've attacked the water, which they never did before. They've also attacked infrastructure extensively, which they didn't do before. Previously, they might have focused on military targets or something else. Now, it's different, right? Now they've started to change. You see that? So, what does this mean? This point is interesting. So, in the past, Mr. Trump signing the MOU and having various agreements with Iran, was it an intention to end the war, or just a tactic to buy time, to add a buffer, to give the United States a chance to re-engage in a new round of conflict? >> Last time, it was clear that it was buying time. What they talk about, what they tweet about, that's their business. >> But what I [clears throat] see behind it >> is very clear. It's that they have controlled their risk factors. The main ones are oil prices, inflation, and interest rates. Simply put, that's enough. Their risk set has only 3-4 main factors, just these 3 main ones, and then it continues to others, right? Once they can control these, they become more aggressive, to put it in layman's terms. >> Like now, like it is now. >> But if oil goes back to over 90, suppose. As we continue to talk, suppose oil goes back to 120 again, I wonder if that's the case. If oil is 120 or more, would Mr. Trump still insist on this? Because it will go back to the same point, right? That if inflation goes up to 4.4, 4.5 again next month, which exceeds the Fed's interest rate of 3.7, right? And if it stays like that for 2 months, don't worry, those who are guessing that the Fed has to raise interest rates, this time it's certain. But if inflation goes up and down, from 4.3 to 3.7, then from 3.7 to 3.5 [clears throat], then what? And with the Fed still having interest rates at 3.7, like this, I still can't say I'm confident the Fed will actually raise interest rates. No matter what the probability says, I won't believe it that much, because the probability is at most 20-30%, right? The highest now is 50%. In the next 2-3, none of them exceed 80-90%. Right? That means you shouldn't be confident yet. If something is 50%, what does it mean? It's like flipping a coin. >> Yes. >> Actually, it's called probability, and actually, it's like nature. But anything below 50% means it's less likely, in layman's terms. But when we look at options, there's a 30% probability, and it went from 20 to 30%. What's the implication? Nothing. I'm saying this, do you understand what I'm saying? But if there's an implication, it's when? When 50 becomes 80, 50 becomes 70. This is difficult. Or in the case I mentioned, when inflation exceeds the interest rate. If it hasn't exceeded yet, suppose, let's assume. Before, we were at 2.6. If it goes up to 3.3, 3.4, it still has no implication, right? No, because it's still lower than the Fed's interest rate. But when it's 3.77% and it jumps to just 4%, and it stays like that, this has an implication. Why? Because the Fed might have to raise interest rates. Because if the interest rate stays lower than inflation for too long, they won't be able to suppress inflation. And this will be problematic. And it will lead to bond yields rising, and so on, as we know. The dollar will also weaken, right? There are many things that will follow. So, I think you need to watch the game. You don't need to keep watching the Fed's probability. You need to look at: 1. Today, the interest rate is equal to the latest inflation. What is the oil price at the latest inflation point? The WTI price is around 90-something dollars. And we're talking about WTI because WTI is the oil price that the US uses to calculate inflation, not Brent. So, don't use that as a benchmark. If you want to think from the perspective of guessing Mr. Trump's intentions, whether he will be afraid and have to suppress risk factors, you need to look at WTI, which has now exceeded it again, reaching 90. This is talking about WTI. So, it means it has reached the level of 3.77% inflation, right? Because the figure that came out, 3.7, is the figure for oil prices. But if the figure is 4.3, it's the oil price around 100. This is an idea. What does it mean? If oil goes up to 100 dollars and stays there, even just 100 dollars, in VTI, you can bet that in another 2 months, it will be announced. It takes time because it's a month lag, right? VTI will definitely rise to over 4% again. And once it's over 4%, then it will come back full circle again. Visual Cycle. But what will be different is this. Your Trump's supporting factors, actually, I have to say this. Trump, Mr. Trump, has to thank China. In the latest round, China helped suppress oil prices by reducing imports by as much as 4 million barrels per day. >> Thank you to everyone who has followed us. Our goal is to take this channel to 1 million subscribers to create a broader society of learning in economics, business, and investment. 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