Here’s the best way to summarize the oil market today:
Global oil product inventories are near operational minimums. It’s low everywhere.
Global ex-China crude oil storage is falling and will reach operational minimums by year-end.
We are now almost 7 months into this Iran war; global crude exports are currently down 3.2 million b/d y-o-y.
Based on the implied crude storage deficit, we are currently seeing a 3 million b/d deficit.
In simple terms, the drop in crude exports is translating almost directly into a drop in onshore crude oil inventories.
To better understand the crude oil math, we look at these 3 variables: