Trump recently announced a “deal” with Putin’s Russia, under which the U.S. will ignore its own law imposing sanctions against Russia for invading Ukraine and purchase specified amounts of Russian diesel fuel.
Ostensibly the reason for this “deal” (I use quotation marks because history shows that most of the “deals” announced by Trump never happen) is to reduce sky-high diesel fuel prices in the U.S. caused by Trump’s unnecessary, ill-thought-out war against Iran.
But this “deal” won’t lower diesel prices in the U.S. It will just infuse millions of dollars of U.S. consumer dollars into Putin’s Russian war machine. In addition, Trump decided a few weeks ago not to take an action that might have lowered U.S. diesel prices. The difference between the two deals — and his recent social media screeds against Ukrainian leader Zelenskyy — reveals much about Trump’s real intentions.
Let’s begin with a basic fact: The market for oil and fuel is largely a world-wide market. Reductions in supply or increases in demand anywhere tend to increase prices everywhere. This is why America’s much-ballyhooed “energy independence” is meaningless — because American producers export natural gas, oil, and fuel world-wide, the price for those materials is set world-wide. U.S. consumers do not see a significant cost benefit.
An exception is when a market is arbitrarily constrained. A painful example is California’s gas market. Because California gas must meet certain anti-smog environmental standards, California’s market is walled-off from the rest of the U.S. — gas refined for use in the rest of the country can’t be used in California.
Several weeks ago Trump considered just such a market-constraining idea. He proposed to forbid the exportation of diesel fuel outside the U.S. This would have brought down diesel prices, at least in the short term, because it would have increased supply in the U.S. by executive fiat.
I suspect Trump abandoned this idea for two reasons, one rational (although self-interested) and one deranged.
First, because forbidding exports would have decreased prices, it would have reduced the profits of U.S. drillers, oil companies, and refiners. These are huge political contributors to Republican candidates. Trump’s advisors no doubt told him that angering these interests two months before critical mid-term elections was not in Republicans’ interests.
Second, the option eventually chosen by Trump — the “deal” with Russia — played to his aberrant fascination and admiration for Putin and his irrational dislike of Zelenskyy. (I’ve gone back and forth in the “is Trump a Russian agent?” debate; at a minimum Trump has a clear preference for the authoritarian, brutal, militarily-powerful Putin over the democratically-elected Zelenskyy, leader of a liberal, “small potatoes” country.) Trump’s deal infuses the Russian war machine with hundreds of millions of dollars to continue its savage attacks on Ukraine.
Watching the commentary here in France, there is widespread stupor and anger, both here and in Europe generally, over the U.S. abandonment of a smaller, democratic country and its embrace of a totalitarian, militaristic one. They suspect (as do I) that if Trump been President in 1939, he would have struck a “deal” with Hitler to help Germany invade Poland.
Trump’s “deal” with Putin is not only a treacherous abandonment of eighty years of American pro-democracy, pro-freedom policy, it’s also dumb (yes, with a “b”). The “deal” won’t bring U.S. diesel prices down any time soon. This is because Russia’s share of the diesel market is small, and many of Russia’s refineries have been damaged, hampering its ability to produce diesel fuel at all. (This also reduces the amount that Russia could earn from the “deal”, the only bright spot.)
So instead of providing real relief to U.S. diesel consumers at the expense of his pals in the oil industry, Trump has thrown a lifeline to a murderous dictator and continues to abandon a democratic country under ferocious attack, part of a “deal” that will not move U.S. diesel prices appreciably downward.
This, America, is your President. Stupid, perfidious, or both.
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