CNBC: Electing Obama could lower OIL by $40/Barrel

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Wednesday July 09, 2008 · 9:39 AM PDT

2008/07/09 · 09:39

Some honest reporting by CNBC today that leaves me unsurprised but may confuse many in the MSM...

If Barrack Obama wins the presidency, the price of oil could fall by $40 per barrel. The financial markets will discount the possibility before hand, at least partially. There are three ways in which this could happen:

As was the case during the Clinton administration, Obama might be more inclined to intervene in the foreign exchange market to support the value of the dollar....

Obama will speak in a more concilatory tone toward nations in the Middle East. If he does, some of the risk premium would likely be extracted from the oil price.

Energy conservation and investment in energy infrastructure are likely to increase if Obama wins...

The choice this year is simple:

Obama: Oil @ or under $100

McCain: Oil @ or above $200

Compare this to McCain's dangerous reactionary response to Iran today, which could easily lead to $200+ Oil and eventual war with CHINA

His immediate plan:

U.S. should "cut off now the trade and diplomatic and other activities that go on between the Iranians and the world."

Iran is a MAJOR supplier of Oil to China with China building and investing in Iranian oil fields and refinaries the last few years.

Official figures show that China imported 226 million tons of oil in2003, about 13 percent of which coming from Iran.

And you can't forget the Japanese

Japanese refiners, who buy about 500,000 barrels per day of Iranian crude, nearly a quarter of Iran's 2.2-million barrel daily shipments, continue to pay in dollars but are willing to shift to yen if asked, people in the industry and officials said separately.

Simply put, if the US were ever silly enough to seriously consider an embargo on Iran, China would come quickly to their defense and well, that's just a scenario I wouldn't or couldn't imagine happening. What McCain is saying sounds neat and packaged but is actually a much worse concept than the war in Iraq and a tactical strike on Iran combined because it would draw China in militarily to defend their oil supply.

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