I think the market had its fun now. The flavor of the month is starting to fade. The recent megacluster escort out of the Oman Lane is falling flat on the ground. Instead of attacking tankers that are in the process of transiting the Oman Lane, OSINT accounts have flagged attacks near Dubai and Ras Al-Khaimah.
Normally, escorting tankers group up near this area and move together, but the latest attacks, which have disrupted flights near Dubai, are starting to bite into the crude oil math.
From the start of this war, the closure of the Strait of Hormuz was always fundamentally a crude oil problem. Of the 21 million b/d of oil that flowed through it pre-war, 18 million b/d was crude oil. Thinking this wouldn’t be a crude oil problem in the long run is just lazy thinking. Sure, the market ran out of petroleum products first because of storage differences, and now the market is fixated on tankers, but if you use first principles, it has always been a crude oil problem.
I don’t know whether my clarity of thought comes from being the dumbest person on the planet or from never believing in groupthink. And who knows if I’m going to be right or not, but the reality is a lot more straightforward than you think.
Now that global crude oil buffers are running out, we are finally starting to see some market indicators.