Rep. Eliot Engel, the top Democrat on the House Foreign Affairs Committee, is poised to take the chairmans gavel from retiring Republican Ed Royce of California. While the new Democratic majority is threatening investigations into the Trump administration, Engels rise could help fortify one of the administrations most controversial policies: the presidents crackdown on Iran in the wake of the withdrawal from the 2015 nuclear deal forged by then-President Barack Obama.
I really believe that Iran is the most dangerous player in the region, Engel said at an event hosted by The Israel Project last year, and some expect him to help find a bipartisan path on foreign policy with Trump.
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Congressman Engel has shown strong and thoughtful leadership on critical foreign affairs issues and, as exemplified by his hand-in-glove work with outgoing chairman Ed Royce, was a model for working in a bipartisan manner — so critical in what can be a polarized Congress, Toby Dershowitz, senior vice president for government relations at the nonpartisan Foundation for Defense of Democracies, told the Washington Examiner. That bipartisanship will be desperately needed if the U.S. is to continue having an impact addressing Irans malign activities, including its destabilizing presence in Syria, Iraq, Yemen and Lebanon, its continued missile proliferation, its rearming of Hezbollah, and its serious human rights abuses at home and abroad.
“It will be a difficult period but Iran’s economy will withstand it for various reasons,” a second diplomat told Reuters, “including (the fact of) Russia being under (US and EU) sanctions, Saudi Arabia having its own financial and political issues, and (trade war) between China and the United States.”
Video: WTI Crude Oil and Natural Gas Forecast November 8, 2018
US crude closes in bear market territory, settling at $60.67, down 21% from 52-week high
When Obama lead his party in a rapprochement with the pariah regime, Engel argued against the Iran deal. After Obama committed the United States to the nuclear deal, he believed that Trump should not withdraw from the pact, but instead enforce it strictly. His attitude, in either instance, remained anchored in the belief that Iran represents a unique threat in the Middle East.
That puts him at odds with many Democrats, although he was also at odds with the Trump administration after it said it would withdraw from the agreement but stop short of imposing maximum sanctions back on Iran.
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Whatever its flaws, withdrawing from the Iran deal was a mistake, Engel said last week. We do need to be tough on Iran, but weve given up the assurances that Iran will abide by the limits and strict monitoring of the nuclear agreement. At the same time, adversaries around the world may rightly wonder whether American sanctions should be taken seriously, or if theyre just tough talk.
Still, that posture has Iran hawks optimistic about working with him, even in a polarized Congress led by Senate Majority Leader Mitch McConnell, R-Ky., and likely speaker Nancy Pelosi, D-Calif.
The potential for cooperation isnt just a matter of bipartisan temperament, as Engel made clear while seated next to Royce at the Israel Projects 2017 event. Theres not any difference in the way we think about this issue, the New York Democrat said. I could take his speech and read it. He could take mine and read it. We all agree with it. And, really, thats the way foreign policy should be. It should be bipartisan, where possible.
That doesnt mean hed be a pushover for the administration. I wont stand for delay and non-responsiveness to things that are clearly in our jurisdiction, he told the Washington Post in an interview published Thursday.
Engel is also interested in investigating whether Trumps business dealings have shaped his policy to Russia or other governments. Its a valid topic for us to look into, Engel added. There has been a concern about the motivations of the administration in terms of policies in different countries, and is it connected to Trumps business interests.
WTI is clinging to a gain for the year, up 0.5% in 2018, according to FactSet, while Brent is still up 6.1%. Thursdays close below the bear threshold means the bull market ended on Oct. 3, halting a 324-day run that began on June 21, 2017, according to Dow Jones Market Data. The bull market was the longest since a 350-day run that ended on Jan. 28, 2015.
Video: Iranian FM blasts U.S. sanctions on Tehran
But even his skepticism of Russia foreshadows a hard line with respect to Iran and the 2015 nuclear deal.
In a volatile turnabout, the U.S. crude benchmark fell into a bear market Thursday just five weeks after hitting a nearly four-year high.
Oil ends lower for a ninth straight session and enters a bear market
“Theyre all in it together,” Engel told the Israel Project in 2017. “Russia and Iran have collaborated, its my belief that they collaborated all during the negotiations on the JCPOA [nuclear deal] and I think that thats — the old line of the axis of evil, I think this is the axis of evil today. And we have to confront it.”
“This tactic is a maritime security threat. These transponders are designed to maximize visibility at sea and turning them off only increases risk of accidents and injuries,” Hook said. “Self-insured Iranian tankers engaging in unsafe behavior, with many tons of crude oil on board, are courting environmental and financial disaster.”
Video: Russia, Germany slam US sanctions on Iran
U.S. oil prices dropped for a ninth consecutive session on Thursday, falling into a bear market, on further signs of growing supply even as data showed record Chinese oil imports.
Video: Russia, Germany slam US sanctions on Iran
Crude prices have plunged over the last five weeks, buffeted by Octobers broader market slump, signs of deteriorating demand and rising output from key producers.
Video: Russia, Germany slam US sanctions on Iran
The decline continued earlier this week after the Trump administration announced it would issue waivers to eight countries, allowing them to continue importing Iranian crude for the next 180 days. The United States restored sanctions on Irans energy, banking and shipping industries on Monday.
“As a result, oil supplies are going to be higher than the market anticipated,” said Andrew Lipow, president of Lipow Oil Associates. “So it seems to me that the loss of Iranian supplies is only going to be between 1 and 1.2 million barrels per day, and the OPEC and non-OPEC producers have more than made up for that.”
U.S. West Texas Intermediate crude fell as low as $60.40 a barrel on Thursday, briefly wiping out its gains for the year. The contract settled $1, or 1.6 percent, lower at $60.67. Thats down 21 percent from last months four-year high of $76.90, putting WTI in bear market territory.
Brent crude fell $1.33, or 1.9 percent, to $70.74 a barrel at 2:30 p.m. ET. The international benchmark hit a session low of $70.60, tumbling 18.6 percent from its nearly four-year high of $86.74 on Oct. 3.
U.S. gasoline futures are also trading in bear market territory, down nearly 28 percent from their 52-week high.
Chinese refiners have also been importing a lot of Canadian oil relative to their usual intake of this particular oil. With the discount of Western Canadian Select to West Texas Intermediate at historic lows making the Canadian blends particularly attractive for Chinese bargain hunters, chances are this trend will continue for the time being unless the price environment changes radically.
Prices fell to a nearly eight-month low on Wednesday after the U.S. Energy Information Administration reported the seventh consecutive weekly increase in U.S. crude stockpiles.
U.S. output also hit an all-time high at 11.6 million barrels per day last week, according to preliminary figures released by the EIA. If confirmed during revisions, it would more firmly establish the United States as the worlds top oil producer.
US oil enters bear market
The EIA forecast this week that U.S. oil production will average 12.1 million bpd in 2019, marking an upward revision from its last projection.
The other producers in the top three, Saudi Arabia and Russia, have been dialing up production since June.
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“All three of them are continuing to pump at record levels, thats been … part of whats causing oil to move into a bear market,” Tamar Essner, director of energy and utilities at Nasdaq Corporate Solutions, told CNBCs “Worldwide Exchange” on Thursday.
New U.S. sanctions on Iran—which have come under fierce criticism by Iran hawks in Congress and elsewhere for providing major concessions to Iran and its European business partners—have failed to cover “half of the publicly listed firms under the principal control of the regimes security forces,” according to research conducted by the Foundation for Defense of Democracies, a think tank that has worked closely with the administration on national security issues.
“I think the market is grappling with some fundamental uncertainties,” she said. “We dont know if we are oversupplied or undersupplied.”
Forecasters also lowered their estimates for oil demand growth last month, taking some of the froth out of the market.
CNBCs Jim Cramer said he sees a path for U.S. crude to fall to $40 a barrel as growth in demand moderates and supply rises.
This includes permitting Iran to continue sensitive nuclear research work at several military facilities known to have once housed a weapons program. Additionally, Iran will not be fully cut off from the international banking system and will be allowed to continue exporting crude oil to at least eight countries—concessions the administration once vowed would not take place.
U.S. Warns Iranian Oil Tankers May Be Courting Environmental Disaster
However, Chinese trade data released Thursday showed the countrys oil imports rose to an all-time high at 9.61 million bpd in October, Reuters reported.
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Crude futures also drew support on Wednesday from a report by Russias TASS news agency that Saudi Arabia and Russia are in talks to push a group of about two dozen oil producers to cut production.
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The group of OPEC and non-OPEC producers began cutting their output in January 2017 in order to end a punishing oil price downturn. In June, the exporters agreed to restore some of that production after their combined output fell more than they intended.
A committee representing the group is set to meet this weekend and could make a recommendation to the wider group, which meets next month. Last month, the committee said supply is “very comfortable” relative to demand and warned that macroeconomic uncertainty could force OPEC and its allies to begin cutting output again.
US crude oil enters bear market, prices fall for ninth straight session
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