US Oil Affected by Bolton Departure
The US President has bid goodbye to another national security adviser.
This comes after an array of internal disputes over Russia, Iran, North Korea, and several other foreign policy issues.
John Bolton, on the other hand, claims he offered his resignation to Trump on Monday night first. The former adviser tweeted:
Bolton Was Splitting White House
The 70-year old now-former national security adviser to the White House was hawkish on many issues.
That being said, he did seem to manage to keep a tight rein on Pyongyang’s plutonium production during his tenure under President Bush.
In the Trump era, however, there was a breakdown of attempts to schedule peace talks with Afghanistan last weekend. This came as a result of internal foreign policy disagreements, indicating the President’s hard-line stance against his advisers.
After Monday, when North Korea’s Kim Jong provoked the US once again by testing two more missiles, the Trump-Bolton era came to an end.
Bolton and Trump disagreed on many US foreign policy measures. These included how to deal with provocations from North Korea and Iran. And, most recently, they disagreed on negotiations for a peace accord with the Taliban. Sources say that Bolton, who was notoriously pro-war, was even excluded from meetings related to Afghanistan.
Bolton seems to have played an important role in the worsening of tensions between the US and, North Korea, Venezuela, Iran, and Russia. The two men argued for a long time, with Trump expressing his dissatisfaction over Bolton’s hawkish stance and policy splitting for months.
This is now the third national security adviser Trump has fired. The position is vacant, for now. But, Charles Kupperman, Bolton’s deputy, will serve for a week or so until the President picks his new “ally”.
How Will A Dovish Replacement Help Trump?
The internal division is widening. And Trump is somewhat forcing a more dovish stance when it comes to foreign policy.
Therefore, the markets will start looking at the run-up to the 2020 election with a different lens.
North Korea’s first vice foreign minister Choe Son Hui has stated that her country is prepared to resume talks. And that could be Trump’s chance to offer an alternative, softer path to denuclearisation now that Bolton is out of the way.
WTI Oil Takes a Breather but Looks Bullish Medium-Term
Risk assets have been on a good run lately. This is especially true given the latest geopolitical deescalations. With that said, the shift in commodity-based currencies and oil itself has allowed market participants to gain.
The firing of Bolton, however, has halted the oil rally for now. His dismissal seems to be a sort of healing potion to further geopolitical tensions.
Despite the recent cap, WTI oil still looks bullish in the medium term. The break outside the descending triangle could offer more long opportunities, with short-term ones depending on the EIA report later today.