DoJ Considering Anti-OPEC Legislation, Opening Door To (I Guess) Matt Whitaker Suing Saudi Arabia

And now back to your regularly scheduled deluge of OPEC headlines.

Yes, oil managed to pick itself up off the mat following Tuesday’s harrowing plunge (the second such episode in the short space of a week), but no, the news flow wasn’t what one might call “bullish” on Wednesday.

The EIA data showed another larger-than-expected build in crude stocks which have now risen for nine consecutive weeks, and while there was plenty to sort through for those in search of nuance (Cushing draw, refinery activity, etc.), the overall picture remains largely unchanged: Folks are concerned about oversupply and a cloudy outlook for demand.

[Aside: CME Group hiked margins on crude, nat gas and refined products today]

Meanwhile, Donald Trump wasted no time in publicly declaring that Riyadh now owes him a favor for his decision to give Prince Mohammed a pass on the whole chopping up Washington Post columnists with bone saws thing. “Oil prices getting lower. Great!”, the President tweeted on Wednesday morning, before sending out a big “Thank you to Saudi Arabia” and insisting that we need to “go lower!”

Again, the message is clear: The White House let Prince Mohammed get away with murdering a dissident and now, Trump wants that favor returned in the form of a pledge to keep oil prices low.

According to reports, the Kingdom’s production surged to a record near 11 million b/d in November and now Riyadh is facing a choice: Don’t support the production cuts tipped in Abu Dhabi earlier this month or do support them and risk incurring the Twitter wrath of an unhinged reality-TV-show-host-turned-U.S.-president- turned-armchair-commodities analyst.

Read more

Trump, Who Has ‘No Business In Saudi Arabia’, Thanks Kingdom For Oil Price Plunge A Day After Khashoggi Statement

It’s against that mind bogglingly absurd backdrop that the Justice Department is reportedly reviewing anti-trust legislation designed to curtail OPEC’s sway over oil prices. That, according to an official who spoke to Bloomberg on Wednesday.

“While the study is ongoing, there is an understanding that the oil cartel’s efforts to affect crude prices through production quotas has raised costs for American consumers”, Bloomberg reports, citing the unnamed official, who also indicated that the cartel’s behavior is “traditionally the type of conduct the Justice Department would frown upon.”

There’s already legislation pending in the House and Senate on this, depending on your definition of “pending”.

So I guess what this means is that Trump would likely support any effort to let the Attorney General sue OPEC in the event the cartel, I don’t know, acts like a cartel.

Considering the fact that Trump is engaged in an ongoing effort to install himself as de facto leader of that same cartel, I suppose the next question is whether the DoJ can then sue @realDonaldTrump if something goes wrong and prices spike, given that OPEC’s marching orders are now distributed via that Twitter handle.

When you throw in the fact that Matthew Whitaker is now Acting Attorney General, this whole thing becomes even more insane still.

Maybe Whitaker can just roll all of this up into one lawsuit where he goes after Hillary Clinton, James Comey and Khalid Al-Falih all at once, charging them in one giant conspiracy spearheaded by George Soros and the aliens at Area 51. Alex Jones can cross examine the witnesses on behalf of the government.