Nothing Learned - Trump Gives Himself an A-Plus, and the G7 Open the Diesel Tanks for Him

An emergency reserve waits for the day when nothing works anymore. It sits quietly in its tanks, untouched by markets and campaigns. Since Friday, that day has a date. It is written on the American election calendar.

The G7, the group of wealthy democracies, announced Friday that it would release 100 million barrels of oil and petroleum products over the coming weeks, the equivalent of roughly 16 billion liters. Diesel would come first, and in "substantial" quantities. Within 20 days, an early, large-scale release was supposed to begin "immediately," with the rest following over 4 months. Donald Trump himself announced online that the diesel would flow "immediately."

He's in a hurry. The midterms are on November 3, and Republicans are under pressure to get prices under control. Approval of Trump's economic policies has fallen to a new low, according to a recent poll. The war against Iran has been going on for 8 months, and his trade conflicts are making oil and other goods even more expensive. Trump has repeatedly said the price is worth it as long as Iran does not get nuclear weapons.

On Friday, diesel cost the equivalent of about $1.68 per liter nationwide, according to the AAA automobile club. On September 22, it was just over $1.72, the highest ever. Diesel is also reaching record prices in Europe. The bill is arriving right in the middle of harvest season: many farmers are bringing in soybeans and corn, the country's 2 biggest agricultural crops.

There is more to it than expensive crude oil. Russia has banned diesel exports because Ukrainian drones are hitting its refineries. Europe no longer buys Russian diesel, but previous customers such as Turkey and countries in Latin America are now competing with Europeans for the available supply. Fewer refined petroleum products are coming from the producing countries of the Persian Gulf because the war has damaged facilities and blocked export routes.

France currently holds the G7 presidency. The statement followed a video conference led by Emmanuel Macron. The United States and Canada were at the table, along with Japan. Germany and France joined from Europe. Italy and Britain are also part of the group, and the EU is represented. "This joint decision and this unity should bring prices down," Macron said. The released volumes would also bring liquidity into the market.

During the night, Trump spoke with Macron by phone about rising fuel prices and the supply of petroleum products, according to the French Embassy in the United States. On Friday, he then joined the meeting of heads of state and government to negotiate the release of European diesel reserves. That is how a White House official, who wanted to remain anonymous, described it. Europe's emergency reserve as campaign help.

Back in March, member countries of the International Energy Agency had pledged 426 million barrels to calm the oil market. EU countries accounted for about 92 million of those, mostly in the form of refined petroleum products such as diesel. The new announcement pushed the U.S. oil price down by 2 percent. Part of the effect faded because one question remained unanswered, according to Pavel Molchanov of the investment firm Raymond James: Are the 100 million barrels on top of the March pledges, or are they simply the final part of them?

Some Republicans had demanded that Trump ban diesel exports. The G7 agreed on the opposite and does not want to restrict energy exports among its members. Analysts warn that an export ban could lower prices in the short term and come back to bite later. Less diesel can only be produced if refineries cut overall production, and then gasoline would be in short supply.

We deliberately kept this article short. Faced with this much cowardly politics, words fail us. Just over 1 month before the election, at the very moment when prices are hitting him the hardest, the G7 are strengthening Trump with this decision, and massively so. In the capitals, they may call that diplomacy. We call it a political declaration of bankruptcy.

Since Thursday, Trump has been touring the country, with 32 straight days of rallies planned by his own account, so his party can hold the House and Senate. It bothers him that people see his successes differently than he does. This week, he gave himself an A-plus for his economic policies. They were just doing an "extremely poor" job of selling them, he added.