Having made the week for Vix buyers quite profitable, President Trump – whose North Korea rhetoric sent market volatility soaring in the past week – appeared ready to spread the love among long-suffering oil bulls, when on Friday afternoon Trump refused to rule out a U.S. military intervention in Venezuela, and said that the US has a military option in the insolvent, quasi civil war Latin American nation.
“I’m not going to rule out a military option,” Trump told reporters at his New Jersey golf club discussing recent events in Venezuela. “We have many options for Venezuela, including a possible military option, if necessary,” Trump said after a meeting with Secretary of State Rex Tillerson and UN Ambassador Nikki Haley.
President Trump: “We have many options for Venezuela, including a possible military option if necessary” https://t.co/EIPUTM5T5D
— NBC News (@NBCNews) August 11, 2017
The president did not answer whether American troops would lead that potential operation.
“We don’t talk about it. But a military operation, a military option, is certainly something we could pursue,” he responded.
In recent week, Trump’s administration issued several rounds of sanctions against Venezuelan leader Nicholas Maduro, whom it calls a “dictator,” and more than two dozen other former and current officials. The U.S. accuses Maduro’s regime of violating human rights and subverting democratic processes. Most recently, on Wednesday the US sanctioned the brother of deceased former leader Hugo Chavez – Adan, who was appointed secretary of Venezuela’s new “all powerful” constituent assembly.
Separately, Trump also said he would will speak with China’s Xi Jinping tonight, adding that “we’re considering additional sanctions at a very, very high level” on North Korea. The president also said that “nobody loves a peaceful solution” more than he does, but warned that “bad things could come.”
Asked by reporters to clarify what bad things and if he meant war, Trump says “I think you know the answer to that.”
So, instead of just one offensive war, Trump appears set to launch two, which is probably not surprising: back in early April when Trump unleashed the military strike against Assad, it didn’t achieve anything but at least it pushed the Russian collusion narrative away from the front pages for a few weeks. With the president increasingly concerned about Mueller’s sniffing around, Trump may as well double down.
And with markets now having not one but two potential warzones to keep an eye on, Sunday afternoon futures activity could get interesting, while the reaction esponse in the price of oil to a threat of war in the country with the largest petroleum reserves in the world would seem obvious: up.