Everyone's watching the Strait of Hormuz. That's not the real issue.
MST Financial's Saul Kavonic: even if the Strait reopened tomorrow, there's barely anything left to ship. You can reopen a shipping lane in days. Rebuilding energy infrastructure takes 3 to 5 years.
The strikes physically erased nearly a fifth of the world's gas supply. Not delayed. Gone.
IEA's Fatih Birol confirmed the 1970s shocks knocked 5 million barrels per day offline each. Current disruption: 11 million barrels per day. More than both 1970s shocks combined, and the war is still ongoing.
Trump announced a 5-day pause on strikes. Markets bounced. A pause doesn't rebuild a refinery. The infrastructure deficit doesn't care about the diplomatic calendar.
The repricing hasn't happened yet. When institutions figure out this is a multi-year supply hole with zero spare capacity buffer, oil goes up with or without a ceasefire.
Iran War ceasefire ain't fixing oil prices
byu/Certain-Zucchini-293 ininvesting
Posted by Certain-Zucchini-293
20 Comments
5 day pause on all strikes or just ones on electrical infrastructure?
Feels like February 2020 to me. So many people assuming this is a story that will stop affecting the economy in a month or two.
and what makes you think this is not priced in?
Markets want the good times back regardless of the facts on the ground. They’ve been trained to expect the hand of govt to reach out and prop them up like the last 20 times. Well, you can’t print energy.
Copium.
Not that what you’re saying isn’t true, but the truth of the matter has little to do with markets at the moment. It’s all vibes and beliefs.
Oil is just one product gone. Also gone is the helium, argon, polyethylene ….
Market is forward looking, as long as no missles are firing and the straite is open, it will v shape
So let’s talk about who benefits from sky high oil prices.
The US saying hold on we need a break just shows weakness. Turnip is admitting that Iran has their boot on his neck. If Iran wanted to show its teeth there would be strikes tonight.
Your theory only works if oil was running at max production before the war. It’s well known and documented OPEC lower their output significantly so prices don’t crash
All they need to do is produce more with what’s left
Reserve releases can fix a lot of the impacts from a short term disruption.
So yes it wouldn’t immediately fix oil prices if the straight opened up but it would over time.
In the likely event that it lasts a few more months that’ll turn into a bigger issue.
I thought about building a long term long on it today. If oil hit 120 a barrel, that is not good for the whole world. Last week it spiked out of nowhere. I watch it, but not trading it yet. Im sure Forex traders are the driver in price. But is one stock that I hope falls way down.
Trumps “fixing” oil prices just fine.
It’s an ominous sign that we’re just weeks into the war, the enemy isn’t wavering, and our leaders are already pulling out the stops to try to mitigate the economic damage.
The decision lies with insurers now. When they feel safe about continuing policies while crossing the straight, oil will drop.
There is no ceasefire.
A five percent loss of capacity to be gobbled up by renewables.
Yeah, this is the real bottleneck that nobody talks about. Even OPEC can’t just flip a switch and restart refineries, tje geopolitical risk premiums are probably doing more heavy lifting on prices than actual supply constraints right now
And so? Buy and hold!