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Speaker 1: Now oil prices dropped surprisingly with Iran striking Katar Brad

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Speaker 1: olsonism for metrics principle economist and with us.

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Speaker 2: O Brad good evening.

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Speaker 1: Would you have expected them to do the opposite?

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Speaker 2: Well, we've sort of been expecting a bit more of

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Speaker 2: a fulsome response from Iran. So if that had happened,

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Speaker 2: then yeah, we were expecting oil prices to go higher.

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Speaker 2: If we saw the straight up our moves being blocked

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Speaker 2: or similar, you could have seen a much different result.

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Speaker 2: As it is, over the course of twenty four hours,

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Speaker 2: we've had the markets go from being still quite worried

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Speaker 2: about things to now a ceasefire being in operation. Oil

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Speaker 2: prices have crashed something like fourteen percent since their peak.

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Speaker 2: We're now under seventy us of barrels. So, you know,

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Speaker 2: the course of a couple of days, we've gone from

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Speaker 2: what feels like the brink of World War III to

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Speaker 2: you know, everything's back to normal.

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Speaker 1: So now we've got a cease Well, don't get over excited, Brad, geez,

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Speaker 1: I mean, it's still Trump running the free world. We've

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Speaker 1: got a bit of a ceasefire deal here. What's that

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Speaker 1: going to do to the price of oil?

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Speaker 2: So far?

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Speaker 3: It really seems to have settled everyone down. The expectation

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Speaker 3: and the concern, I guess was always that if you

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Speaker 3: had this wider regional conflict, if you saw the Iranians

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Speaker 3: that we're going to block the Strait of Hormuz that

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Speaker 3: has twenty percent of the world's oil going through it,

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Speaker 3: that would see further spikes in prices. You would have

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Speaker 3: seen that in New Zealand with potentially three dollars a

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Speaker 3: eeter of petrol starting to come back. As it is,

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Speaker 3: things have actually gone back now. Oil prices are now

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Speaker 3: lower than where they were before the original Israeli strike

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Speaker 3: on the thirteenth of June, and so everyone seems to

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Speaker 3: be now looking at things and going, well, there's no

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Speaker 3: real reason that oil supply should be constrained. There seems

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Speaker 3: to be no ongoing risk to getting fuel, and so

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Speaker 3: on that basis, there is sort of no need to

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Speaker 3: worry quite as much, which is why you've seen the

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Speaker 3: price is sort of I'm not going to say they've crashed,

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Speaker 3: but Jesus, it was a pretty big drop over the

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Speaker 3: last twenty four hours of over ten percent. I mean,

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Speaker 3: we really have gone from one end of the spectrum

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Speaker 3: to another in a very short space.

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Speaker 1: Now the whiplash is something else, so Brad, thank you

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Speaker 1: so much. Appreciated. Brad Olson for Metrix Principle Economists.

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