Asks if Senator Daines is correct that US energy dominance insulates the economy from Middle East oil price shocks.
Kailey Leinz
Bob McNally
Agrees from a broad macroeconomic GDP perspective, as the US is a net oil exporter. However, for the voting motorist at the pump, being a net exporter does not insulate them from crude oil price spikes.
Asks what McNally would advise President Trump regarding the energy implications of potential military action against Iran.
Kailey Leinz
Bob McNally
States there are no quick solutions; the SPR cannot offset the loss of Hormuz. A conflict with Iran carries enormous risks but also enormous rewards if Iran is neutralized.
Asks about the vulnerability of US Gulf allies and OPEC producers to Iranian retaliation on energy infrastructure.
Kailey Leinz
Bob McNally
Allies like Saudi Arabia and UAE are very vulnerable, as seen in the 2019 Abqaiq attack, but a wide-scale war is not in their interest.
Asks for a realistic oil price target in a conflict scenario, noting Brent is at $72.
Kailey Leinz
Bob McNally
On outbreak, prices could go up another $3-$5/barrel easily. There's already a $5-$10 risk premium. Could see a spike then reversal if market thinks US will quickly secure Hormuz.