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Donald Trump Fired John Bolton and Now Oil Prices Are Falling

President Trump fired the national security adviser, and oil prices went from positive to negative as the market quickly repriced to reflect a smaller chance of a conflict with Iran.

President Trump fired the national security adviser, and oil prices went from positive to negative as the market quickly repriced to reflect a smaller chance of a conflict with Iran.

12:42 a.m. It was just a another quiet day in the market—and then President Donald Trump fired National Security Adviser John Bolton.

That Bolton would leave the White House wasn’t all that much of a surprise—reports of constant battles between Bolton and Secretary of State Mike Pompeo have been rampant. That the market actually reacted, however, might be.

The moves haven’t been very big. The Dow Jones Industrial Average, up 5.38 points to 26,840.89, quickly turned positive, sold off, and then slowly made its way back toward the unchanged mark:

https://asset.barrons.com/dynamic-insets/charts/cdc_864ffc76c71236d964bee078.json

Oil’s move was more dramatic, as West Texas Intermediate crude, the U.S. benchmark, went from up more than 1% to down on the day in a blink of an eye.

https://asset.barrons.com/dynamic-insets/charts/cdc_dc5bffc2e2e74b7054069065.json

WTI crude was down 0.3% at $57.70 a barrel at 12:25 p.m. That oil would fall isn’t so much of a surprise. Bolton is a well-known hawk on Iran, and his departure likely means the chances of a military conflict are slightly lower than before his firing. As a result, some of the risk premium that had been built into the market as a result of the potential conflict had to come out.

For now, crude looks perfectly happy remaining in its range between $50 and $60.

Markets Now is a quick take on what’s happening with the Dow Jones Industrial Average and other major market indexes. Don’t forget to check out the rest of Barron’s markets coverage.

Write to Ben Levisohn at Ben.Levisohn@barrons.com

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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