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Comment by lonely_wanderer | Hacker News Reader

I vacillate between two potential rationales:

- there is a concerted effort to target and topple oil producers which China relies on as a form of containment of the Chinese economy. Venezuela, Iran, eventually Russia in a more direct way. The current administration is willing to accept economic pain for just about everyone because they see the transition from petroleum to green energies as the death knell for US superiority. They see this as their last chance to derail China, so they are taking it. It provides incidental value (like giving pre-text for increasing domestic repression).

- they thought it would be easy after Venezuela and Trump was flattered by Netanyahu and pressured by evangelicals into doing it.

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The China point doesn't make any sense to me.

High oil prices only accelerate China's transition to renewables, and rewards them for all the investment they've made so far, both in national energy production and in selling panels and EVs to the world.

It hurts the US far more, especially with this admin's anti wind and solar policies.

China can't transition that fast. China has a lot of oil in storage but if the current situation continues or gets worse they are hurt. The US is a net exporter of oil so is okay though some areas use middle east oil and are hurt too.

This will take a long time to play out. Discount every short term prediction as both Iran and the US are forced to play a long game.

How does being a net exporter even help? There's a global market and prices rise globally. US companies and consumers will pay more no matter if we're importing or exporting.

It means the us gains a lot from high prices. Different people see different effects of course, if you are not invested in oil it hurts.

US oil companies gain, you mean.

Most are public so my 401k gains. Oil companies will expand in this scenario and those new employees pay taxes, both which benefit everyone in some way.

I drive an EV so I gain. Though most lose more than they gain, this isn't a complete loss for anyone.

Why would an increase in oil prices translate to new jobs? The price increase has no relation to value added, only to global scarcity, so there's no need for new jobs.

The price increase, and the anticipation of the price increase, means that if you have the ability to produce oil, now would be a great time to be drilling wells. Of course, you have to consider the late time between how long it takes to drill a well and get production versus how long you think this will go on. Still, it's a reasonable investment that the oil business should be looking at right now.

> those new employees pay taxes, both which benefit everyone in some way.

The too-big-to-fail companies and Trump's cronies, you mean?

Couldn't a stroke of a pen (executive order) specify that US markets must be saturated prior to exporting?

That penstroke is just generating a black market.

This is where tariffs help actually, if they could be approved. You bring in money from tariffs, use that to subsidize things - gas tax is one way but it is small, but there could be others. Of course no tariff on gas exports since everyone wants it :) But it needs Trump world view with Obama's level execution :)

You can do a lot with renewables.

You can't do things like "make plastics" or "run entire industrial districts" off of them, at least not yet. Both are incredibly important to China for the time being.

You also can't run most blue-water naval ships off of them, but that's a bit less impactful.

The rush to renewables frees the oil to be focused on the non-transitional.

I am not saying the gambit is correct. I am purely trying to reason about what those in charge may believe.

If you know your enemy’s position strengthens with time while your position weakens with time, under a certain mentality, you attack now.

The last time the US tried to cut off a major pacific competitor from Oil, it resulted in pearl harbour getting bombed.

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