Crude oil prices are playing the geopolitical gyration game. Events in Brazil, Iran, Saudi Arabia, Venezuela and the United States have oil prices and traders trying to price in risk in a rapidly changing political world. Calls for impeachments, changing political relationships, elections, OPEC meetings, the list goes on and on. The world could look like a very different place in the coming hours, days and weeks. Heck, even prosecutors in Sweden are dropping their investigation into Julian Assange rape charges. With all of this craziness, the risks for the oil market are to the upside.
We know about the President Trump situation. The U.S. has assigned former FBI director Robert S. Mueller III as a special prosecutor to oversee the Justice Department’s inquiry into charges that could range from the Russians influencing the U.S. election or that President Trump tried to obstruct justice in the investigation into his former national security adviser Mike Flynn. The investigation could extend even further into other issues like did President Trump have contacts with aliens from Mars and did he used undue influence to get that extra scoop of ice cream. Yet the assignment of a Special Prosecutor seemed to calm the markets and calm Democrat politicians that are so tired of being so outraged all the time. They seem to be backing off their calls for impeachment. Probably because they might not be happy with where this investigation leads. It may extend to Democrats and their contacts with the Russians and other investigations that got swept under the rug. Be careful of what you ask for. You just might get it.
But if the odds of a President Trump impeachment is going down, the odds of an impeachment of another president in Brazil is rising. Brazilian markets tanked as tapes that seemed to suggest President Michel Temer condoned bribes to pay hush money a key witness in a bridge scandal surfaced. Oil prices there tanked along with other Brazilian commodities like orange juice, soybeans along with Brazil stocks and of course state-owned Petrobras. When a report surfaced that his party asked for his resignation, the U.S. dollar spiked even after Mr. Temer said he would refuse to quit.
