Trump's authorization of russian diesel supplies to the U.S. will not lower prices; it is a PR stunt ahead of the elections — expert Mykhailo Honchar
U.S. President Donald Trump is trying to use the authorization of russian diesel fuel supplies to the American market as a PR stunt ahead of the midterm elections to Congress, but this deal will not lead to a significant reduction in prices. This opinion was expressed in an interview with OstroV by Mykhailo Honchar, president of the Strategy XXI Global Studies Center and an expert on international energy and security relations.
“The issue is not a diesel shortage: there is enough of it in the United States. It is common knowledge that the U.S. is the world's largest producer and exporter of petroleum products. Prices are high, but this is caused by entirely different factors, not by strikes by Ukraine's Defense Forces on russian oil refineries”, - the expert said.
He recalled that even in the best of times, russian diesel fuel reached the U.S. only sporadically and in small batches that had no decisive impact on the American market.
Honchar believes that Trump's decision is primarily driven by domestic politics. The U.S. president is trying to demonstrate to voters that he can quickly solve the problem of high fuel prices ahead of the U.S. midterm congressional elections scheduled for November 3.
“This is just a shop window being displayed to us. Trump is trying to solve the problem of high prices ahead of the U.S. midterm congressional elections on November 3. It is clear that this is a PR stunt: there is no actual process of price reduction behind it, because the problems in the Persian Gulf persist”, - the expert noted.
According to him, the U.S.president is shifting the blame for rising fuel prices onto Ukraine, even though the situation on the market is linked to other factors. At the same time, the U.S. remains a major producer and exporter of petroleum products and does not depend on russian diesel.
Honchar also pointed out that American producers have gained new opportunities in international markets thanks to changes in fuel supplies.
“Moreover, Trump should be thanking Ukraine on behalf of American companies, particularly the major oil companies: thanks to strikes by Ukraine's Defense Forces, they have expanded their market share. American diesel has gone to Europe and Brazil, where approximately half of diesel supplies came from russia last year”, - he said.
The expert emphasized that, if additional fuel supplies are needed, the American market can rely on Canada. From a logistical standpoint, this is much easier than transporting diesel from russia by tanker with additional transshipment stops.
In Honchar's view, a batch of russian fuel cannot significantly change the situation in the U.S. He explained that prices may fluctuate daily, but such changes are usually measured in just a few percentage points, whereas Trump is effectively promising a much more substantial price reduction.
“This deal cannot affect prices in any way. Of course, prices fluctuate daily, but we are usually talking about changes within a few percentage points. Trump, however, is promising a dramatic reduction”, - the expert noted.
He added that the U.S. president is creating the impression that complex economic processes can be managed through simple political decisions.
“So this is a PR gamble that is being accompanied by a corresponding information campaign”, - Honchar concluded.