First off, apologies if this is posted in the wrong spot. Mods, please feel free to move it if necessary. Given the fact that there appears to be a huge disconnect between the market pricing of oil futures, and the physical supply on the ground, I feel we are setting ourselves up for a proverbial fall off a cliff.
In other words, do you feel that once stone cold reality sets in and oil prices sky rocket, that markets will panic and start a huge sell off that could ultimately lead us into a global recession? There is also the side effect of inflation which would depress economic growth and is kryptonite to the markets.
Perhaps I’m just overthinking things to be honest, but is this a viable scenario? To be sure, I thought about buying the recent 10% dip in the Dow but didn’t! I think things are going to get a whole lot worse as we move into the Summer and Fall. On the other hand, a friend of mine who works in the banking sector bought in and says I missed a golden opportunity. Thoughts?
Will The Oil Crisis Lead To A Global Recession?
byu/Excellent_Rock4296 inoil
Posted by Excellent_Rock4296
23 Comments
Yes
Yes
Yes
Many people are saying this, the best people
No trump will tweet the oil prices to a manageable level.
No. Trump will tweet that everything will be alright and there will not be a recession.
Yes
Stock indices making all time highs during the largest energy crisis ever to me indicates completely disconnection from reality and from what is going to come. That and/or most market participants (algos) are in it for a quick trade or at most a few days or weeks which isn’t my objective. I can afford to wait in TBills until there is more visibility, then I will happily get back in. If nothing dire on the radar in 60 days I’ll re-enter.
There is nothing that says stocks can’t give up their recent gains. The situation is too uncertain. Your banking friend could be proven wrong in the end. Unfortunately everyone under 40 has been trained to buy the dip. It will work until it doesn’t.
You can’t take that many btus/kwh out of a system without creating a profound effect. At the end of the day, the global economy is physics. And energy does the work.
Trump bankrupts casinos and is now trying to bankrupt America and everyone else with it.
Yes. No. Maybe.
Possibly if the conflict drags on for months. But at this point I would say not a global recession. However, countries dependent on oil/gas imports will suffer. Countries (not in the gulf except Saudi) with net oil and gas export are more insulated but won’t be immune forever.
Also if the Houthis pull some shit in the red sea, it’s not looking good.
Be patient if you can go back six years Nobody thanks Trump for the 2020 Covid-19 global recession. Nobody will thank trump for stopping whatever percentage of the global oil economy comes through Hormuz creating another global recession. There’s a strong correlation between global oil and supply chain getting damaged and inflation getting worse and a global recession getting started .
Yes, and what will happen to oil in global recession coupled with open Strait?
When? I think by the end of May the reality of the situation will hit global. It is being sensed already in Asia, Australia and Europe (in that order), but the copium is still propping up markets. North America will start to notice in the coming weeks as the 170 tankers at or headed to Houston start to drive up WTI and WCS.
This is unrolling identically to COVID. Right now we are in the, hug a recently landed Chinese immigrant phase. The mask-up and flatten the curve phases come in a couple months. Interesting to me is what the, take the jab phase, will look like. What is the solution to a looming energy crisis? Just demand destruction? New technology investments?
Probably
You’re too confident in the price of oil spiking to levels to cause a recession. That is not a guarantee.
We use paper oil 😂
There already have been several recessions caused by out of control oil prices.
I’m not sure if you looked at past threads but check out [this](https://www.reddit.com/r/oil/s/kaoW18vQCF) comment I wrote recently. It links to a Bloomberg article that writes about global recession specifically.
Likely and infkation
Of course it will😂.
Stop kidding yourself, this is a Trump crisis, there was no oil crisis until that clown went into Iran and bombed a school full of children. blame him and him only.