The PDB Situation Report | September 5th, 2026: Tanker Attacks Deepen the Crisis in the Strait of Hormuz & Could Washington Strike an AI Deal With Beijing?

Mike Baker (0:07)

Welcome to the PDB Situation Report. I'm Mike Baker, your eyes and ears on the world stage. All right, let's get briefed. First up, attacks on oil tankers and dwindling traffic through the Strait of Hormuz push crude oil prices toward $100 a barrel. Uh-oh, Daniel Turner, executive director of Power The Future, joins us to discuss. Later in the show, America and China are racing, of course, to build more powerful artificial intelligence. But you ask yourself, should there be limits? Well, Brendan Steinhauser joins us on the case for negotiating an AI deal with Beijing.

But first, today's Situation Report Spotlight. This week, two supertankers carrying Saudi oil were attacked while leaving the Strait of Hormuz, killing two sailors. Saudi Arabia blamed Iran. The US responded by striking two Iranian government tankers under its new quote tanker for tanker policy, while Tehran expanded its blacklist of vessels to 56

Shipping traffic remains severely reduced, and Brent crude has now climbed above $97 a barrel. That's its highest level in six weeks. So where are oil markets heading and how could this confrontation affect American consumers? Joining us now is Daniel Turner, Executive Director of Power The Future. Daniel, thank you very much for being here on The Situation Report.

Always great to be back with you.

Daniel Turner (1:30)

Thanks for having me on again.

Mike Baker (1:32)

Daniel, thank you. We got a lot to cover. I guess the first thing is, and this is, I know this is very hard to, it's like predicting, right, how long is a piece of string. But based on the current situation, right, the renewal of kinetic action, you know, the comments from the White House that they're extending deployments, so they appear to be thinking, okay, this is going to be going on for a while.

Where do you think the oil markets are heading?

Daniel Turner (2:03)

I'm not thrilled with where they are right now, I'll tell you that. Last time I was on your program, it was a couple of weeks ago, and oil was just, I think, above 75-77. I was bragging about how, look, things have calmed down quite a bit. Clearly, markets are stabilized, and this is sustainable. Last I looked at online, oil was at 92 today, and that's not good.

The President will paint his picture of where things are, and what's happening there, and how we're in control, but oil markets are not going to believe it if they don't want to. Currently, they don't believe it. I think this is the sweet spot. It's a terrible sweet spot. $90 a barrel is expensive. Really, it's not that 300 that Wall Street was predicting, right?

JPMorgan and others were saying, we're going to hit $250, $300 a barrel. That's clearly not gonna happen. But we also shouldn't be content with $90 a barrel. So... I think here's where we are, but it's not good.

Mike Baker (3:08)

Yeah. Stepping back just for a second, can you remind our viewers that in times when there's no conflict, right? Just in sort of... I was going to say in normal times. I don't know if we ever have normal times, but you know what I mean.

What do you consider the actual sweet spot for pricing?

Daniel Turner (3:25)

Well, if we go to January of this year, it was probably a little lower than it should be. It was $57 a barrel. If you're in the industry, you want it around $75 because you are making enough of a profit that it is worthwhile.

You can reinvest, you can hire, you can expand. $75 is a lot of money for a barrel of oil. I would say it should be around $65, but that's kind of the price range. And it fluctuates, right?

SPEAKER_3 (3:50)

It's $68, it's $62, it's $74.

Daniel Turner (3:53)

But $90 is a lot. $90 is the preferred price point for the Middle East. That's how they build their indoor ski resorts and the world's largest building and the world's tallest wall. That's all built on $90, $100 a barrel of oil.

They also use slave labor, right? They don't have OSHA. They don't have labor unions, you know? So when you pay Filipinos $6 a day, you can make a lot of money in the oil business. But $90 is how they sustain their economies. We can do fine on $70, and that's kind of what we should be aiming for.

Mike Baker (4:30)

Okay.

At what point when it drops, does it become, and again, I know that there's parameters here. It's not just a dollar, but when does it become sort of unattractive, untenable for the industry in terms of new exploration, new production facilities, all of that?