economy
Oil market at 'tank bottoms' in Asia, and Europe isn't far behind, warns market veteran Jeff Currie
Oil markets are nearing minimum operating levels in Asia, with Europe likely next and the U.S. potentially facing shortages by July, said Carlyle's Jeff Currie.
TL;DR
- Asia's oil markets are nearing minimum operating levels, with Europe and the U.S. potentially facing shortages by July.
- Global oil markets are under strain due to the Iran war and disruptions to shipping through the Strait of Hormuz.
- Headline inventory figures are misleading, as much stored oil is unusable.
- Product prices like diesel have seen explosive increases.
- Relief from U.S. oil flows to Europe may be temporary as the summer driving season begins.
- Proposals like suspending the U.S. federal gasoline tax are insufficient to address the underlying supply crunch.
- The only solution is to increase the availability of physical oil supply.
- Reopening the Strait of Hormuz is the only lasting solution.
- Shrinking global inventories are strengthening Iran's leverage in negotiations.