The United States faces a double blow from crude oil and soybeans! US soybeans hit rare limit down, and after getting bogged down in Middle East quagmire, Democrats may sweep Republicans in midterm elections

Currently, the Middle East situation is tense, and the Strait of Hormuz has become a global focus. According to CCTV News, on March 14, the Strait of Hormuz was navigated without any ships for the first time, whereas before the conflict, an average of 77 ships passed through daily.

Previously, Iran repeatedly emphasized that oil tankers and commercial ships of the United States, Israel, and their allies are prohibited from passing, and any violations would be targeted for attack. Trump had proposed discussing with other countries to jointly ensure the safety of navigation through the Strait of Hormuz, but so far, no country has committed to sending warships for escort. On March 16, Trump complained that some countries are “not enthusiastic” about assisting the US in safeguarding navigation through the Strait of Hormuz.

Since the outbreak of the conflict, international oil prices have experienced an epic rally. Brent crude oil prices soared from around $70 to a high of $119. Amid actions such as releasing global oil reserves to hedge, prices temporarily fell sharply to $81. However, recently, as the shipping situation in the Strait of Hormuz worsened, oil prices rose again above $100.

US soybeans faced shocks. On March 16, all main futures contracts on the Chicago Board of Trade (CBOT) agricultural products declined, with soybean futures dropping 5.71% to $11.55 per bushel.

Everbright Futures analyzed that CBOT soybeans hit a two-year high before falling limit down, due to market disappointment over increased US soybean exports. NOPA data showed that US soybean crushings in February exceeded market expectations, with daily crush volumes jumping to record highs. Meanwhile, soybean oil inventories expanded to the highest level since April 2020. US soybean export inspections reached 966,000 tons, surpassing market expectations by 400,000 to 800,000 tons.

Currently, the US midterm elections are approaching. According to Polymarket data, since the outbreak of the Iran war, the probability of the Democratic Party sweeping the midterm elections has surged to a new high of 46%, significantly leading the Republican Party at 17%. As oil prices trigger inflation and the soybean market faces shocks, the Democrats are likely to gain control of either one or both chambers of Congress. Trump’s last two years in office will undoubtedly be affected.