Trump's Oil Price Control Sparks Concerns Over Energy Industry Profits

President Donald Trump's influence on oil prices has been likened to that of the Federal Reserve, an unprecedented level of control. His comments on high profits and 'making too much money' led to a collapse in gasoline and diesel crack spreads, prompting concerns about speculative fever. However, Treasury Secretary Scott Bessent's statement on a potential Iran deal to reopen the Strait of Hormuz highlights the need for caution.

Aramco's second-quarter adjusted net income jumped 33% due to war-driven surge in oil prices and its ability to keep exports flowing through pipelines that bypass the strait. CEO Amin Nasser emphasized the importance of maintaining healthy profits for energy companies, as the global refining system operates near maximum utilization.

The manufacturing renaissance in the US, marked by a 55.6 July ISM Manufacturing PMI reading, is being driven by increased energy demand from industries such as petrochemicals, plastics, and fertilizers. Nasser noted that replenishing depleted inventories could take up to 18 months at an average rate of 2.1 million barrels a day.