Publications: Notes at the Margin

Do Not Be Blind: History Has a Lesson (December 23, 2024)

 

This is our last report for 2024. Few will read it this year, given the long holiday period. Many more will read it in 2025, especially if we keep reminding them of it as we remain focused on two core themes.

 

First, those who write on oil continue their refusal to look to history or the lessons to be found in other markets. This blindness will likely be costly.

 

Second, the incoming Trump administration wants low gasoline prices. The data make clear that the high fuel prices of 2023 and early 2024 contributed to the President-elect’s victory. A return of high prices in 2025 and 2026 could lead to significant Democratic gains. Trump will try to prevent this by granting the oil industry wishes for less regulation and more leasing and then demanding large output increases to hold down prices. We see a William Jennings Bryan-like moment in which Trump and his followers declare, “We will not be crucified on a cross of gasoline!”

 

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