Trump's Tariff Tantrum Tanks Oil Prices! Is Chaos the New Normal?

Clean Your Room... Then Fix the Global Economy!

Alright bucko let's dive into this oil price debacle. Seems like the marketplace is having a bit of an existential crisis much like some of you after your first philosophy lecture. Trump in his infinite wisdom – and I use that term loosely mind you – has decided to play tariff whack a mole. He giveth with one hand a temporary tariff ease and taketh away with the other by smacking China with a whopping 125% tariff. Now I'm not an economist but even I can see that's likely to ruffle a few feathers – and sink a few oil prices.

The Chaos Dragon Cometh!

This whole situation reminds me of something I've talked about extensively: order and chaos. You need both. Trump bless his heart seems determined to embrace chaos with the fervor of a toddler wielding a crayon in a freshly painted room. Jim Burkhard from S & P Global Commodity Insights asks a very pertinent question: can the U.S. negotiate with 70 countries at once? The man is clearly struggling with his own dragon and I suspect the answer is a resounding 'no'. It's like trying to herd cats while simultaneously juggling flaming bowling pins. Not a recipe for success I tell you what.

Beyond Good and Evil... And Oil Prices!

The market of course is reacting with all the predictability of a caffeine fueled squirrel. U.S. crude plunges Brent follows suit and West Texas Intermediate has a full blown identity crisis swinging wildly like a pendulum in a haunted clock tower. This volatility folks is a direct result of uncertainty. People don't know what's going to happen next and when people don't know what's going to happen next they tend to panic and that's when bad decisions are made.

Sort Yourself Out Then Sort Out the Trade Deficit!

Trump’s 'openness to negotiating deals with countries that don't retaliate' sounds like a thinly veiled threat. A real 'nice country you got here be a shame if something happened to it' kinda vibe. It's a high stakes game of chicken and the oil market is caught in the crossfire. The problem with these grand sweeping pronouncements is that they rarely account for the nuances of human behavior or in this case the complexities of international trade. It is a little simplistic wouldn't you say?

The Devil You Know... Or the Tariff You Don't!

This is where we see the problem with impulsive decision making. It's like when you're cleaning your room and you decide to rearrange everything only to realize halfway through that you have absolutely no idea where anything goes. That's where the global economy is right now. Trump has thrown everything up in the air and seems to be hoping it will all magically land in the 'right' place. Good luck with that.

Embrace the Responsibility... Of Your Trade Policies!

So what's the solution? Well that's the million dollar question isn't it? Perhaps a little less saber rattling and a little more careful planning. Maybe just maybe focusing on building strong reliable relationships instead of constantly threatening tariffs. But hey what do I know? I'm just a humble psychologist urging you to clean your room and confront the chaos. The rest as they say is up to you... and the whims of the market.