FOX Business host Larry Kudlow discusses the Trump administration's handling of the war in Iran. analyzes economic performance on 'Kudlow.'
So lo. behold, Project Freedom to reopen the Strait of Hormuz has been operating surreptitiously after all this past month. According to President Trump’s disclosure today. our military has secretly helped more than 200 commercial ships with more than 100 million barrels of oil through the Strait.
This was done by communicating and communicating to freely and safely transit the ships, not actually escorting them. Here’s the president earlier today spilling the beans: "You know I can say it now. Something you didn’t do. You know, we’ve been taking out millions of barrels of oil. Nobody knows it. You know who doesn’t know about it? Iran. Until right now." He added that "we took out the other night 22 ships late at night with no lights. because they don’t have any radar, because we blasted the crap out of it. We took out. That’s why oil is $85 a barrel."
No lights, no transponder, no Iranian radar. He’s right. Now, these numbers are more or less correct. And 100 million barrels of oil have come through the Strait to various destinations around the world. let’s assume in the past month or 30 days. That’s an oil supply increase of 3 million barrels per day.
Israeli special ops veteran Aaron Cohen. The Heritage Foundation's Victoria Coates discuss how oil prices can be maintained amid the conflict with Iran on ‘Kudlow.’
Then put that in context, world supply and demand intersects at roughly 100 million barrels per day. So tacking on 3 million by secretly opening up Hormuz. adds roughly 3 percent to the global oil supply, it’s a big deal. And that has surely helped to stop oil from going to $150 a barrel or $200 a barrel. For more context, America produces 13.6 million barrels per day.
In fact, West Texas WTI peaked at $113. Today it’s at $90. That’s a drop of nearly 20 percent. Gasoline peaked at $4.56 back in May. Today it’s at $4.15 according to AAA’s national tally. So that’s a drop of almost 10 percent. Almost half of the states today have gasoline with a $3 handle. I know that’s created anxiety, and everyone wants it at least a dollar lower. Yet it still seems like a modest price to pay to liberate the Middle East. the rest of the world from the scourge of radical Islam in Iran. And surely Mr. Trump is right. This war will end soon and oil and gasoline prices will come down significantly.
Which leads me to my final point on today’s CPI. went up 4.2 percent on the topline year on year. Yet only 2.9 percent excluding food and energy. Yes, most of this jump in prices is from 104 percent annual increase in energy over the past three months. And a 250 percent jump in gasoline. Goods prices, by the way, at least excluding food and energy are basically flat. So much for the tariff inflation threat.
Sen. John Kennedy. R-La., says the primary concern for most Americans is the soaring cost of living, not foreign policy or cultural debates, on 'Kudlow.'
Yet let’s not forget the economy is booming. Manufacturing, business capital goods, factories, construction, profits, productivity, and stocks (even with the current sell-off). Low taxes, a light regulatory touch, drill, baby, drill, and the A.I. boom are growing America’s economy at nearly 4 percent with low unemployment. It’s a supply-side revolution.
And hopefully at next week’s Fed meeting. Chairman Kevin Warsh will tell the world that growth does not cause inflation, nor does a temporary energy bump. The new chairman will hopefully bring in new models, and a new breath of fresh air a week from today.
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