The theory that markets reach an equilibrium effortlessly, defined as the conjunction between supply and demand to set the price of any item, can be challenged on the premise that a narrative can manipulate a market – be it through the market legitimately misreading a ground reality or through deliberately misjudging a narrative.

President Trump’s manipulation of the oil market subsequent to the 28 February 2026 launch of the US/Israel war on Iran has been frequent - through statements on social media timed to impact the market on a Monday, or so allege his critics. This generated genuine bafflement at the seeming naïveté of those operating in the oil market in being so easily convinced of the veracity of the President’s widely divergent announcements that he continues to make – announcements that alternate from an interpretation of the Memorandum of Understanding (MoU) widely different from Iran’s interpretation, followed by threats to obliterate Iran interspersed with periodic attacks on Iran invariably trailed by Iran’s retaliation.

The question is what motivates President Trump to manipulate the market? Perhaps he miscalculated on two counts: (i) failure to recognise the interconnectedness of the energy global market or, in other words, to understand that a world supply shortage as a consequence of the Middle East conflict would impact on gas prices in the US, in spite of the country being as a major oil producer; and (ii) insider trading, deliberate or otherwise, that may leave him open to charges of enriching his friends.

Soon after the war began the US had large stocks of oil; however, as the war has stretched into its fifth month stocks have begun to reach dangerously low levels, threatening the onset of a recession. This has angered Americans in general, including his support base, with severely negative repercussions on his personal popularity rating that is likely to impact on the impending mid-term elections scheduled for 6 November 2026.

All 435 seats are up for elections in the House of Representatives while 35 out of 100 are up for re-election in the Senate. Presently, surveys suggest that Republicans safe seats are 140, they are likely to win another 55 seats while 45 of the seats they hold today are likely to go either way. Democrats have 182 safe seats, they are likely to win another 10 and only 3 seats that they hold today could go either way. In the Senate, the Republicans have only 4 safe seats, one they will probably win and 4 could go either way while Democrats have 18 safe seats, another 6 they are likely to win and 6 could go either way. In the event that Republicans fail to secure majority in the two houses as it is being projected today President Trump maybe impeached, a concern he has already publicly admitted.

There are growing allegations that the President’s statements on deals or strikes against Iran are enriching a few traders. At present, the Commodity Futures Trading Commission is investing irregular trading activity, of up to 800 million dollars at last count. Be that as it may, it is relevant to note that the oil price decline in the event of President Trump announcing an imminent deal with Iran is in the futures market, which has yet to impact on the price of oil at the gas pump. In this context the Pakistani public urging the government to reduce petrol prices at the pump is certainly premature unless of course we have access to subsidised imported oil.

Survey after survey reveals that with the pump prices not lowered the US public is not heeding President Trump’s narrative that the war is over and the matter resolved – a factor that indicates that the general public is never convinced of the veracity of any narrative if the value of each unit of currency they earn continues to erode.

The Pakistani public, too, has remained indifferent to government claims of a decline in inflation though in our case both the narrative and the data are being manipulated. The narrative in Pakistan is that the economy is on a growth trajectory and the proof is in a buoyant stock market. Given that less than one percent of Pakistan’s population engages in the stock market, frequent references by finance ministers, including the incumbent, to a bullish market as indicative of the success of their policy decisions is simply not tenable. This is strengthened by several research studies, including that of Hussain and Tariq Mehmood, who concluded that “a disturbing feature of Pakistan’s stock market is that it cannot be characterized as a leading indicator of economic activity and in the absence of other strong indicators shooting up stock prices may indicate a speculative bubble.”

Empirical studies further suggest that the Pakistan Stock Market is dominated by brokers, a tight-knit club, with the capacity to manipulate the market. Its uptick especially at times when the incumbent finance minister is facing criticism has led many a critic to maintain that the leverage of the government rests with a threat to raise taxes. There is a 15 percent general sales tax on listed securities for filers and 30 percent for non-filers; however, there is a relatively low rate on actual transactions and capital gains compared to other countries; for example, India levies a Securities Transaction Tax (STT) on every trade, in addition to Long-Term Capital Gains (LTCG) and Short-Term Capital Gains (STCG) taxes.

The International Monetary Fund in its October 2024 report highlighted important shortcomings in data that impacts on one-third of our GDP – an observation supported by independent economists that led to a technical assistance to the Pakistan Bureau of Statistics. But to reiterate manipulating inflation figures does not convince the general public.

To conclude, a narrative may initially convince some of the people some of the time but even die-hard supporters will withdraw their support if they see a steady erosion of the value of each unit of currency they earn. And inflation is one statistic whose impact is evident to a householder as soon as he/she goes to the market to purchase any item or service. The lesson to be learned is to back claim of achievements with data that resonates with ground realities facing the public.