When you say 'structurally higher', what range are you referring to in the next 2 weeks + long term? Are you still in the same positions you disclosed a couple weeks back (~$200 range call spreads and I think May calls at $150ish on USO)?
v helpful. thanks. say the ceasefire becomes permanent -- in all three scenarios outlined above -- wouldn't these positions below would become worthless? i don't use options but the $135 call would definitely be worthless at expiration.
USO May 15, 2026, $215-$245 call spread, USO May 15, 2026, $135 call.
thanks. that makes sense. so this statement "averaging in the mid-to-high $90s for the rest of the year." is about the futures curve? or about if you stood at the end of 2026 and averaged out the daily prices / vwap you would get to mid-to-high $90s.
if the latter, and seems to me to be the case, then you are really saying it'll hit $135 or more or even $250 in May before averaging down by the end of the year to mid-to-high $90s. help me understand if i understood correctly :)
I have a question about the math. Did the tankers taking the last wave of oil out from the closed Strait just drop anchor at the ports where they delivered their oil? None of them turned around and started back towards the Persian Gulf to be in a position to take on a new load of oil as soon as the Strait reopened?
When you say 'structurally higher', what range are you referring to in the next 2 weeks + long term? Are you still in the same positions you disclosed a couple weeks back (~$200 range call spreads and I think May calls at $150ish on USO)?
Same positions.
same level of conviction as you had then -- doesn't depend on whether this supposed ceasefire becomes permanent?
Same conviction.
Longer term, these scenarios still apply.
Scenario 1: Ends this week
Impact on global oil inventories: -50 million bbls (including SPR release)
Impact on Brent: initial sell-off into the low-$80s before averaging in the mid-to-high $80s for the rest of the year.
Scenario 2: Ends the middle of April
Impact on global oil inventories: -210 million bbls
Impact on Brent: initial sell-off into the low-$90s before averaging in the mid-to-high $90s for the rest of the year.
Scenario 3: Ends at the end of April
Impact on global oil inventories: -370 million bbls
Impact on Brent: initial sell-off into the $110s before averaging $110-$120 range for the rest of the year.
Breaking Point: Mid-April
https://www.hfir.com/p/wctw-the-oil-market-breaking-point
v helpful. thanks. say the ceasefire becomes permanent -- in all three scenarios outlined above -- wouldn't these positions below would become worthless? i don't use options but the $135 call would definitely be worthless at expiration.
USO May 15, 2026, $215-$245 call spread, USO May 15, 2026, $135 call.
Please don’t confuse with an average for the rest of the year with prompt month price.
WTI will still move up even if the backend oil prices average at a lower price.
thanks. that makes sense. so this statement "averaging in the mid-to-high $90s for the rest of the year." is about the futures curve? or about if you stood at the end of 2026 and averaged out the daily prices / vwap you would get to mid-to-high $90s.
if the latter, and seems to me to be the case, then you are really saying it'll hit $135 or more or even $250 in May before averaging down by the end of the year to mid-to-high $90s. help me understand if i understood correctly :)
Is short the refiners not a play here?
It is.
I have a question about the math. Did the tankers taking the last wave of oil out from the closed Strait just drop anchor at the ports where they delivered their oil? None of them turned around and started back towards the Persian Gulf to be in a position to take on a new load of oil as soon as the Strait reopened?
Most tankers are going elsewhere.
So that means the 30 days to get empty tankers to the Strait assumption is accurate?
Yes. Most tankers are now headed for the US, since this is where the excess inventory is.
By the time it loads US and discharges the barrels, it will be additional time. 30-45 days is probably being generous.