So the US and Iran have hit a ceasefire, but do we really think the fighting is over or are we just being lulled into a false sense of security? During this ceasefire, there's a lot happening behind the scenes. Countries are scrambling to secure their oil supplies. Traders are putting their bets on whether this ceasefire will actually stick. Companies might seize this chance to cash in on profits. And let's not forget, other nations might try to negotiate with Trump to keep this truce going longer. It’s a big mess we’re navigating, plus the threat of a recession still looms over us.
What does the future hold if this crisis drags on? Right now, the oil supply is tight, not meeting the demand, which is pushing prices up. But if this situation lasts too long, demand is going to take a hit. Not because people want to, but because they have to. Folks will travel less, cut down on energy use, just to avoid sky-high oil prices. So what happens next? The economy starts to slow down. People will start hunting for alternative energy sources. Is demand destruction a good thing? It’s a mixed bag. Sure, prices might drop if demand falls. But on the flip side, a sluggish economy means job losses as companies trim down.
I’m not here to spread panic but just pondering how the US's choices reverberate around the globe. It's wild that they have such a grip on the world stage. What we’re living through right now is definitely something for the history books. The global economy as we know it is gonna change forever.
Nobody can know this question but it was China that made Iran to cease fire just few minutes of the threat that Trump made to about to happen. It is very possible that United States are only trying to play smart but let China know that they can have a better deal with Iran. Which could likely might have been the reason Iran accepted to start a peace deal meeting with United States in Pakistan.
Crude oil is still very important. The Europeans and the West in general has looked for alternative energy sources but this war let other people know that crude oil is still very important. It is what people are using. Expect this not to change over decades.
Donald Trump is unpredictable, so we don't know his next line of action. For now, nations would begin to scramble for suppliers because this ceasefire is very fragile. There is still a large number of US soldiers and weapons stationed in the Middle East. So the war can restart at any time. For now, countries will take advantage of these few days. They will start diversifying their supplier to other oil producing counties outside the Middle East.
The global oil and energy market will begin to readjust. But there will still be uncertainty until there is a permanent ceasefire.
This kind of situation shows how the world economy connects, with little tension in one region can shakes prices everywhere around the world especially oil, with all this happening the markets and countries will always adjust over time and it can happen through alternative energy, policy changes and through new suppliers. We all know that it can only cause short term pressure, but again it's shows that the economy adapts so it's not time for us to fear but it's how businesses and countries will learn how to reduce dependence and just focus on finding balance
Demand destruction has to do with a permanent decline in consumer demand for a product which is driven by sustained high price. Some of this aspects of demand destruction are triggered by prolonged period of excessive price. Another thing is behavioural shift, when consumers change their preferences by switching to substitute products. For example, buying electrical car because of high gas price.
Lastly, long term impact, the reduction in demand is permanent.
We're in a very volatile moment right now, but the thing is.. Israel has been trying for years to lure the American military into the region against Iran and now they've achieved it. Trump is a puppet being manipulated by Netanyahu to give him cover for yet more illegal land grabs in Lebanon. Israel is trying to expand their land all the time and often instigating fights against their neighbors to do so. Iran doesn't help the situation either quite frankly, by stirring up problems and having such a repressive religious government, frankly if both of these countries wiped each other out the world might be a safer place. I feel for all the innocent people, who don't want war and don't support these extreme leaders in power, but they are trapped by the geography of where they were born.
I believed that every stated decision based on geopolitical interest and national security but i remembered moslem believe, middle east will be the center of conflict in the end of times. There are narrative that is widely discussed in my country is that Israel will be more brutal because many signal show that Israel's collapse is imminent. I am not discussing the truth of the narrative but the effect of the end times narrative on the conflict in the Middle East.Fear of destruction or loss of existence create a survive at all costs policy for many nations, even perceived threats can drive defensive action which apprear aggresive. These narrative intensify the tension become mor emotional, difficult to compromise and every party see it as somehing inevitable. When someone see conflict as fate, how we can stop it.
A ceasefire might look like relief, but underneath it, everyones still scrambling countries securing oil, traders speculating, companies trying to lock in profits. Its like a calm before the storm. If this keeps going demand and destruction is real, people travel less, use less energy, just to cope with high prices. Sure, price might drop eventually, but the slowdown hits jobs and businesses hard.
The US really does have crazy influence over the global economy, and every move echoes everywhere. Honestly were probably seeing a moment that history. books will talk about, but for now, its all about watching how demand and supply shift and how people adapt.
From history we can see, in terms of the world economy I am more afraid of Iran than the US, where the US has no role or access to blockade the world economy, the US from century to century has only relied on military power and dollars.
But today's Persia, Iran, has been feared from century to century, Rome, Greece, etc., economic collapse and war in the hands of Persia/Iran, they have an access blockade that shuts down the global economy, the world's main economic and trade power is Iran.
Significantly in my view the impact of the US and Iran war is not dangerous for the US, in fact Iran is more dangerous for the world economy, they have mines in the Strait of Hormuz which paralyze all sectors of the world economy, global oil and inflation or other sectors such as disasters and disruptions to global energy supplies, if that happens the global economy is paralyzed, Asia, Europe, Rome, Greece die.
That's the basics of geopolitics. The Strait of Hormuz gives the Iranians huge leverage in times of conflict and international negotiations. The geographical location of the Strait is to their advantage and they don't fail to play that card whenever they need to, because blocking the Strait disrupts the global oil supply and the effect is massive for the entire world.
That said, it definitely makes them dangerous, but maybe you exaggerate it a little bit. Despite that geographical advantage, more powerful nations like the United States could hit them so hard in other areas where it'd hurt and effectively force them to open the Strait. So because of their huge military advantage, i think that makes them more dangerous.
Many people are working together to avoid fear in the current situation, but the reality is that crude oil remains crucial.
The US is attempting to gain influence in the Middle East, but Iran is different from other Arab countries. Iran refuses to submit and surrender to America.
On the ground, what can be seen, through reliable media, is that Iran is not backing down because it recognizes its sovereignty as a sovereign nation. This has led to Trump receiving tremendous criticism, including from its own people.
NATO members are also reluctant to comply with Trump's demands regarding the escalation of the war in Iran. NATO countries are aware that Trump's actions are not in the interests of the American people or the world, but rather his personal and group interests.
I hate the united state government but I don't hate united state when it come to economic interest. Why do you think countries refused to leave US despite the tarrif fight, it's because they need the US more than they need the Donald Trump. He is just a guy that will not be there forever, anytime he make economic sanctions like increase in tariff and others, they stay, endure until he leaves the office, he will not be there forever, the US is very important.
The US are good in playing world economy, they may not need you but they make sure you want them by all cost. Even the countries that claim not to want them, it's because they don't have choice and when you check their economy, it's always obvious one or two things that are lacking. I just hope this regime stop find a common ground and end this chaos. There is noting gain in war, I was watching what happened in Lebanon on Al Jazeera and I was speechless.
I believe the war has peaked its effect already, and nothing worse would happen if it continues. Sooner or later, the Strait of Hormuz will be opened, whether Iran likes it or not. It will only take time.
You guys often take things like this too seriously than it should be. The current global inflation we face is a little compared to what had been faced before. And like I said in a thread, this is not even capable of causing a hyper-inflation in the countries that are sane, not to mention recession or worse as you make it look. Aside from the US, war will always bring out issues like this, especially if the world depends on something that the war could affect. The world experienced it's fair share in the Ukraine-Russia war, and heaven did not fall. This one too shall pass.
Donald Trump must win this war. Could his lack of clarity be a strategy? This is very possible for him. He always conveys a convoluted narrative on his social media, which can cause confusion. But on the other hand, we know the character of the US government. They must win. At least there will be an agreement that benefits them. But if not, we might see what we fear from this war.
The time is very short, and there are many possibilities after this ceasefire. Especially with the third party joining the war, namely Israel, which always launches sudden attacks and destroys the ongoing mediation between the US and Iran. The possibility of a continuation of the war is very possible because, as we know, US weapons and military are still present in the Middle East despite the attacks. However, I hope that peace can no longer be a ceasefire, but there must be a peace agreement.
That is true, I believe this war will just be one for the history books as humans will continue to thrive on this planet. We will surely surpass this challenge in mankind. Do remember, as long as we live - there's hope. So yeah, we can conquer this trial and for sure, there will be realizations especially from the governments which are directly involved in this matter of war.
And now that US military blocks the entry and exit of Hormuz to try to stop Iran's source of oil income - we don't know what will happen next for this negotiation. It seemed that both parties are trying hard to pressure each other to give in to each other's demands. But let's see where they will meet because a lot of people are already suffering with the rising oil prices in the market. It is not only them that is experiencing the impact of this war.
Trump warns Iran as US military blockade on Iranian ports takes effect
I think US will deceide to leave Israel face Iran by themselves which mean Israel will be target for Iranian attack without US help. I think Trump relize that war actually benefited US's rival instead of making them loose. For both short and long term, war benefiting China economically and geopolitically. If trump continue escalation, beside face domestic sentiment due to expensive expenses for war also he calculate possibility Iran will destroying optical network on Hormus strait or bombing gulf country's clean water instalation, so the effect of war will be weidening regionally and harm US partner.
Furthermore i think Trump also calculate that China and Rusia currently studying US war strategy in every move, and if too concentrate in middle east war, US will be distract from Taiwan and Europe issue. Beside that if the worst case happen, China attack Taiwan and Rusia occupy Ukraine or North Korean also take part, how US will share his weapons to keep stability in those area
A decrease in demand (especially due to the impoverishment of the population) does not automatically lead to lower prices. Because this requires an oversupply of goods. Where will the excess of goods (including food) come from when there is a shortage (or at least a high price) of oil (energy) and a shortage of fertilizers (gas is the raw material)? Production will decrease, which means there will be fewer goods, effective demand will decrease due to job cuts, and all this will cause prices to rise. So - a halt in economic growth, a drop in effective demand, rising prices - what is it? - Stagflation.
If the the temporary oil crisis could create what you call demand destruction, whats stopping it from creating demand creation when the price goes back to low again.
What we are talking here is just temporary unstability. Eventually the price will find its equilibrium and the demand will come back to like what it's used to be.
Demand destruction only possible if there is stronger alternative that could replace combustion engine on its entireity permanently not just travel less or move less.
I also agree with you. In fact, the situation of complete demand reduction has not yet been created. In the economy, when demand increases, prices increase and when demand decreases, prices also decrease. But now there is a crisis moment due to the war. In this case, it will not match the economic rules. Even then, it is not possible to say how normal the situation will be in the future. If people limit the use of all things dependent on oil and make a habit of it, then their demand may decrease somewhat permanently in the future, then the price may decrease slightly compared to the normal situation.
I wouldnt expect them not have, which ever propaganda they might put out there to serve some purpose that might benefit them in course of the on going war, you can expect them to play that card.
As much as the US can hit them hard, we can be rest assured that, they could keep fighting and the war can take quite some time for either sides to yield and certainly not America.
However, if they can come to terms on a ceasefire, why not come to a comprise and end the war.