David Satterfield: former US Ambassador in the Middle East on whether Trump rejecting Iran deal will impact US mid-terms
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What was the Iranian proposal to open the Strait of Hormuz and why did Trump reject it?
The Iranians in New York last week, of course, after the UN General Assembly, there was some kind of hope that some sort of deal around the oil in the Strait might be profit or offered or done. The Iranians offered to open it in seven days. Trump said no. Brent said 104 this morning, which isn't as bad as it has been. David Satterfield is the former US ambassador in the Middle East, and he's with us. David, very good morning to you. Good morning. The seven days from the Iranians, was that disingenuous and real? And if it was real and Trump's rejected it, what's he playing at?
Both sides are using rhetoric to shape negotiating positions and on the part of Donald Trump to try to impact the markets in a favorable sense. What's behind it from both sides is the fact that Iranians population, the Iranian regime, is hurting from the economic sanctions and the blockade of the Strait. Donald Trump, for his part, is hurting because of the price, not just of gasoline, of petrol, but of diesel, which is critical for industry, agriculture, and transshipment of goods. Each side wants to get out of this situation. Donald Trump believes he can do it by outweighing the Iranians. They think the same.
difficulty for trump is he's got a date and it's called a midterm and it may well hurt him will it
well whether the the midterms themselves because of iran hurt him the economic impact of all of this on the consumer price index on inflation has been significant and it's increasing and will continue to increase That's without question. Is it going to hurt him? Yes, the economy unquestionably will hurt him. But is the midterm, is that November date, a trigger point somehow for some different strategy, either immediately before or after? That's very difficult to say.
Interesting.
How are the Iranian and U.S. sides using rhetoric to shape their negotiating positions?
The Besant line last week about closing down all the Iranian airlines, is that real? Can you do that? Can they do that? Is it
possible? Oh, yes, of course. In fact, it's essentially been done. One of the last remaining places still debating over what to do about the Iranian flights is Iraq because of the special relationship there and Iranian pressures internally and externally on the government in Baghdad. But that's about it. Iranian airlines have been shut down. It's done. So the squeeze is real. Oh, yes. Squeeze is real and it's hurting. But the Iranians – and here's the critical issue – The Iranian regime believes it can absorb more pain for a longer time than the region can, the global markets can, or Donald Trump can.
I don't know if you're an expert on oil, but I'm trying. So Saudi Arabia over the weekend said they're getting six million barrels out a day. It's being escorted out by the US military. Yes. And so that's all good. And yet I look at the price of oil, which isn't good. What's actually going on? Does anyone know? Sure. Two
things are happening. First, crude is moving out of the Gulf. It's moving under escort or moving with transponders turned off, the so-called black ships or dark ships. It's also moving through pipelines and other means, including to the Red Sea. So, yeah, crude is getting out. But your question about the price of refined products, that's a different thing. The Russian production of refined products, petrol, Jet fuel, the distillates, has been cut by almost one-third because of Ukrainian strikes. That is what has had the dramatic impact on prices.
Great insight, David. Appreciate it very much, David Satterfield, who's a former U.S. ambassador in the Middle
East.
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