Red Sea disruption to oil supplies is overblown, argues Julian Lee. Why?
1. Houthis unlikely to attack Russian ships heading to India & China 2. Saudi pipeline can bypass Bab Al Mandab 3. Iraqi & Saudi shipments to the US don't go through the red sea Source: Bloomberg, Ziad Daoud
The US added the equivalent of a new Venezuela in oil supply during Q4, with less rigs producing more oil as technological efficiency ramps up
This supply growth has exceeded expectations and furled OPEC's attempt to put a floor under prices, at least for now. Source: Markets & Mayhem, Bloomberg
Maybe oil is not that irrational... As shown on the chart below, Oil (purple line) keeps following the Citigroup US Macro Surprises index (yellow line)
The weaker the data, the lower the prices. Sounds logical. Source: TME
BREAKING: Crude oil prices drop below $70/barrel for the first time since July 2023
Since the September 28th high, oil prices are now down ~27%. Meanwhile, the national average gas price is down for 10-straight weeks to $3.25/gallon. Even as OPEC+ agreed to additional supply cuts last week, oil markets are selling off. A welcomed development for global liquidity, for inflation and for the Fed. Source: The Kobeissi Letter
The EV Impact on Oil Consumption by E`LEMENTS / Visual Capitalist As the world moves towards the electrification of the transportation sector, demand for oil will be replaced by demand for electricity
To highlight the EV impact on oil consumption, the above infographic shows how much oil has been and will be saved every day between 2015 and 2025 by various types of electric vehicles, according to BloombergNEF. Link to full article: https://lnkd.in/eYm5iJ8d
How big is the Oil Market ?
by Elements / Visual Capitalist
Oil vol, OVX, and gold vol, GVZ, have exploded higher and continue to stay at elevated levels/move to new recent highs
These are the two assets to watch for the "real" war stress. Source: TME, Refinitiv
Will oil prices react to the Israel-Gaza conflict?
A probability tree by Alexandre Kateb, CFA
