Discussion

Oil at $150 will trigger global recession, says boss of financial giant BlackRock

r0fl: It’ll trigger a lot of political pressure which in turn will trigger more warExpensive oil has a lot of repercussions

hedora: Either that, or it will force most countries to electrify their economies, which has made economic + ecological sense for decades.The oil interests will do everything they can to fight it. (Like buying off Trump, which probably had a lot to do with us starting the Iran war, and is certainly why we're cancelling many affordable energy build outs in the face of widespread shortages.)Less corrupt economies will pull ahead, and technological progress will bifurcate. The US will probably be on the wrong side of this. China will probably be on the right side.

adi_kurian: How quickly could we electrify our economies and what dent in oil dependence could be made with a will?

decimalenough: Misleading headline: Fink said that "years of above $100, closer to $150 oil" would trigger recession. Which, well, duh, but it's quite different from the implication that even a momentary peak would trigger that.I also do wonder if oil prices would actually stay high even if the Strait of Hormuz stayed closed for years. Many analysts think that as a planet we're already past peak oil demand, and the price spike has turbocharged the transition to EVs (where I live, every EV dealer is flat out and waiting times are months). High prices also spur more production from everybody else. The tricky bit is specialist fuels like jet fuel, where you can't just turn a tap to make more.

BLKNSLVR: Was looking at EVs last weekend, slightly accelerating a purchase that was going to be made soon anyway and, yep, there is plenty of additional interest as a result of current fuel prices / availability.EVs were only going to grow in popularity anyway, but this feels like it's jumped the adoption curve up a peg or two immediately.What I'm interested in seeing is whether infrastructure can scale with the additional interest. And I don't think it will because the the current government is already planning to add an "EV tax" to make up for the fuel excise, and the opposition government (if/when it gets back in) is owned by the fossil fuel lobby, and so they'll be doing whatever they can to slow it down.

eucyclos: Infrastructure for ev charging is a lot easier to add than gas stations though.

eucyclos: Europe, particularly Germany, has quite a will. Maybe a little faster than that given there are lessons to be gleaned from it.

samaltmanfried: > Like buying off Trump, which probably had a lot to do with us starting the Iran war...Oil companies have actually not benefited from America's middle-eastern wars. America's regime-change wars have made the region less profitable for US oil companies. Why invest in infrastructure in countries with unstable regimes, or risk of infrastructure becoming a target?If anything, energy companies would benefit from the sanctions on Iran being lifted, so they could invest in infrastructure there, or buy gas from Iran.I hope one day this silly 'war for oil' meme will disappear.

adrianN: I doubt people here can give realistic estimates as to how quickly we can ramp up the production of e.g. heat pumps, since a lot depends on how much we're willing to pay for it. There are many areas where we have the technology to electrify, we just don't do it because at current fuel prices pay back times for electrification are too long. There are also simple things like better insulation for buildings that can dramatically reduce fuel demands.

diogenescynic: It'll force American to negotiate with Iran and China/India will be the mediators. It will be the beginning of the end of the Petrodollar and likely force America to leave the Middle East. It will empower Russia, China, and India while hurting US interests. I don't know why we started this war at all other than to serve Israel's interests even when it means harming our own.

decimalenough: The beauty of EVs is that the infrastructure is for most part very decentralized. Anybody with a house can charge at home, using cheap off-peak power at night and/or solar panels during the day.Obviously there's work to be done on charging in apartments and highways, but this is a more tractable problem than (say) trying to double hydrogen or even gasoline filling stations overnight.

BLKNSLVR: Hah, yes, of course, I'm falling into the FUD trap.What I meant to say was the kind of infrastructure that defeats some of the FUD around EVs, such as chargers at rest stops along highways, in parking lots, hotel/motel car parks, etc. Chargers could/should become a value-add for businesses that survive on servicing road-trip transient customers.> Anybody with a house can charge at home, using cheap off-peak power at night and/or solar panels during the day.Yes! This is decentralised, existing infrastructure, and that should neither be forgotten nor understated: the ubiquity of 'the lowly power point' is greater than that of the fuel nozzle (in complete awareness of the relatively large disparity between charging time and refueling time, which is a whole can of worms on its own).

whatever1: Thousands and thousands of miles of high voltage cables transformers and super expensive chargers sounds easy to you?A gas station just needs a tank and a pump. You can put it anywhere and can operate with a small generator if 110V electricity is not available. Even as a country you don’t need infra. Just some trucks to import from the closest refinery/ port

gucci-on-fleek: The majority of the oil currently produced is used in things other than consumer vehicles [0] [1] [2], so switching to EVs wouldn't completely solve the problem (although it would make a huge difference). Plus, ~20% of oil is used to make chemicals [1] [2], and there aren't really any feasible alternatives here, so we're going to continue to need lots of oil for the foreseeable future (but if we stop burning the other 80% of it, then that 20% should get a lot cheaper, and fully-domestic production might be possible).[0]: https://www.eia.gov/energyexplained/oil-and-petroleum-produc...[1]: https://www.iea.org/data-and-statistics/charts/oil-demand-by...[2]: https://www.statista.com/statistics/307194/top-oil-consuming...

platevoltage: The ambassador to Israel is a Christian Zionist who believes in the rapture. The secretary of defense is a crazy person with a crusades tattoo. They would burn the USA down to the ground if it meant moving their insane superstitious agenda forward. Is it forwarding Israel's interests? Yeah. Are they doing it because they love Israel and the Jewish people? Not a chance. Isn't the Rapture cool?

jmyeet: The impact of the Strait of Hormuz being closed goes well beyond oil. Here are a few off the top of my head:- Qatar produces 20-33% of the world's helium;- The supply chain for ~30 of the world's fertilizer relies upon supply chains going through the Strait of Hormuz. How do you feel about 10-20% food inflation?- ~20% of the world's LNG passes through the STrait. Let's see how that bites come (NOrthern Hemisphere) winter;- Many Asian countries are wholly reliant on Gulf oil for electricity and fuel; and- Roughly ~20% of California's oil comes from Iraq. The US is the world's largest single oil and gas producer but that doesn't really matter when California has blocked any pipelines into the state such that ~75% of their oil arrives by ship.Oil demand to a point is fairly inelastic but once you get beyond about $120-130 you start getting into destructive demand. Fuel prices really spike and in many places, it's going to severely disrupt electricity.There are many fuel usages for which we have no alternative, namely shipping and aviation. Oh and a lot of heavy machinery and industrial uses of diesel.Additionally, there are significant (at least 25% of the total) non-energy uses. Construction, plastic, roads, etc.Weaning ourselves off of fossil fuels is a decades-long project and only China really is trying to do that. I suspect only China has the long-term supply chains, willpower and commitment to pull off that kind of national project.

BLKNSLVR: cough Russia cough

BLKNSLVR: Yes, if you're rolling it out for a single charger in the middle of nowhere.My understanding is that much of the grid already exists if there is a town or even just a rest stop present, it likely has grid power. I will grant that this doesn't speak to the suitability of said existing infrastructure for running one or a number of a high voltage / high speed chargers.> Just some trucks to import from the closest refinery/ portDriving thousands and thousands of miles.

maxglute: TBH if US had it's shit together and sorted out refinery mismatch it can coast along as CONUS crude island with WTI prices of $40-60, but that's 7-10 year resolution. On paper if Trump sequenced refinery build out during Trump1, US can afford to toast gulf oil and be relatively insulated vs global prices... well not just insulated but have huge energy price advantage. There was lightcone where US could blow up global energy and be net benefactor, I guess thank god evil is stupid sometimes.

mrcwinn: Fortunately, this won't happen. Trump is a populist. The war will end simply because the repercussions are far too great. And even though Israel would like to see the deaths of others continue indefinitely, they are still too small and too weak and too dependent on the US to go it alone.

smt88: I suspect Hegseth and other officials will be replaced when Trump internalizes how unpopular this war is and needs a scapegoat to facilitate a pivot. He's already blaming other people in his administration for anything that's going wrong.Even if his officials are ideologically stable and consistent, he himself isn't.

fragmede: it's used to make plastic, which has its own set of pros and cons.

xvxvx: He lost me at the part where he said AI wasn’t a bubble…

BLKNSLVR: The main thing that worries me about the use of fossil fuels is the heavy machinery where said heavy machinery is used for farming food.There are service stations in rural Victoria that have run out of petrol[0]. If farmers can't run their machines, I don't want to continue that train of thought. I would hope that governments would obviously prioritise food production and distribution over, kinda everything else, but logic and government seem to have a strange relationship.[0]: https://www.abc.net.au/news/2026-03-24/victorian-petrol-stat...

ternus: The infrastructure in question is DC fast chargers. Yes, you can charge at home if you have a house, with a parking space reachable with an EVSE, and your commute is short enough that you can fully recharge by the next commute, and nobody needs the car after hours when you'd otherwise be charging it, and you never take road trips or longer-than-usual drives.Everyone else is, to a greater or lesser extent, at the mercy of the DCFC infrastructure, and it is sorely lacking in many places - even ones you'd expect it to be pretty good.

BLKNSLVR: It is a good point.I'm in the privileged position that I have solar panels and can charge in the garage. I only just had a conversation with someone who was considering an EV, but their 'housing configuration' doesn't support it, it just wasn't feasible purely from a charging perspective in their situation.More public infrastructure, and knowledge of the presence of said infrastructure would open up EVs to a wider set of use cases. It's almost the 'confidence' in the suitability of EVs that needs to be worked on.

jmyeet: This war of choice is going to redefine the US's policy and relationships with Middle East, China, Russia and Europe for the rest of the century. Even if it ends tomorrow. Mainly because the only way it ends tomorrow is if sanctions on Iran are lifted. And they should be lifted anyway so I'd be a fan of that.China, Iran and Russia look to the the big winners here. Everyone else is a loser, the US the biggest loser of them all. In history books I think this will go down as the biggest geopolitical miscalculation and mistake in US history of anything to date and it's not even close.The Middle East consists of a bunch of US client states where arms are used to maintain fealty. The US gives arms to a despotic regime who enrich themselves off of their country's natural resources and they use those arms to stay in power.This last month has shown the US security guarantee to the Gulf to be a paper tiger. This is a seismic potential rift between the US and Israel. This war of choice has undermined relationship with long-term allies (eg in Europe) who were never consulted and never approved of this war and may suffer with significantly higher electricity prices as a result.This is a Napoleon invading Russia level of blunder.

vasco: Not sure how iran is winning while getting destroyed. It'll be another refugee crisis

diogenescynic: They're destroying oil production and distribution capacity daily. This is likely the last time we will see oil prices this low. It's only going up from here. Oh and choking off the supply of fertilizer will drive up food prices... so we're looking at sharp increases in fuel and food prices--basically everything will be impacted. Oh and the Valero refinery in Texas conveniently caught fire today. Prices are going up and staying there. Supply chains will be destroyed and Iran will require a toll to be paid in the future--this will further drive prices up.

bryanlarsen: Many people believe the root cause of the Arab Spring set of insurrections and wars was food inflation. And it's now a lot more expensive then what kicked off the Arab Spring.

BLKNSLVR: Other than the overblown headline, Fink has a strong interest (as in 100%) in not causing market panic.The statement about oil prices is probably a public statement to Trump to "get this situation resolved ASAFP, I've told you what will happen!".

bryanlarsen: Consumer vehicles are the single biggest use, though, and transportation in general is 62% by your first link.The biggest non-consumer transportation usage is trucks, and I expect them to electrify relatively quickly. Trucking is a low margin business and fuel is their biggest expense.> there aren't really any feasible alternatives hereIt's not feasible yet, but I really hope that carbon sequestration comes into play here. Plastic lasts a really long time, so turning CO2 into plastic is one way to go carbon negative.

diogenescynic: I don't think he cares? He's going to cash out after this and his donors will make sure he is paid handsomely for this. He can't run again and Israel just took 10% of Lebanon and is poised to be the great regional power. They're already talking about Turkey and Pakistan as the new threats... They will just keep moving the goalposts until it stops working. I have no clue where this ends, but Iran could end up buying a nuclear weapon from Pakistan if this keeps heating up.

whatever1: Vehicles will be visiting the gas station anyway ? Aka the road-like infrastructure will need to be there.I do not try to claim that trucking fuel over long distances is efficient. Just stating that gas stations themselves need no additional infrastructure.

rayiner: [delayed]

rayiner: > biggest geopolitical miscalculation and mistake in US history of anything to date and it's not even closeBigger than Iraq?

rayiner: > Like buying off TrumpThat’s a weird thing to say considering that the Iran hostage crisis helped swing an election almost half a century ago. It’s not like nobody thought about going to Iran until someone bribed Trump to do it.The far more rational theory is that Trump did it to deflect from his failure to combat inflation domestically. They made an entire movie about his. (Wag the Dog.)

fy20: The US produces much more natural gas than it consumes, so changes like this don't really make sense.Europe started implementing these initiatives a couple of decades ago, it makes sense there as they are a net importer, with residential prices around 3x higher than the US. In my country a newly built house (very low energy demand) is often cheaper to heat with a heat pump than natural gas, especially if combined with solar PV - but that's still more expensive than a home in the US.The most impactful usages are transportation, as everywhere basically everything is transported by road, and renewable electricity generation, so fossil fuels can be used elsewhere (residential, industrial, etc).

HWR_14: Is it going to be a GFC style crash where I want my assets in currency denominated investments (e.g. bonds) to buy assets at crazy low values or is it going to be mega-inflation where I want my assets in commodities and stocks?