On today’s Big Take podcast: @alexlongley1 @JavierBlas explain why, despite global conflicts involving oil producers, oil prices are down and could fall even further https://t.co/3mv7kuBcBN https://t.co/Cw9tPHMjHG ...

On today’s Big Take podcast: @alexlongley1and @JavierBlas explain why, despite global conflicts involving oil producers, oil prices are down and could fall even further. https://t.co/iUekoZBZFc ...

RT Nick Szabo (@NickSzabo4)For someone who pretends to know geopolitics you are profoundly ignorant of the economic basics. Since the dawn of fracking in the U.S. oil has become cheap globally. In gold terms it is far cheaper than it has been since the mid-20th century, whereas almost everything else important (housing, health care, education, food) in the developed world is considerably more expensive. ...

Trade Relations - The US is considering "substantially raising" tariffs on Indian exports [1] Geopolitics - The tariff increase is in response to New Delhi's purchases of Russian oil [1]

Market Trends - The oil market is experiencing stagnation [1] - Crude oil traders are retreating due to global geopolitical tensions and tariff proposals [1]

Demand Outlook - Global crude oil demand is expected to decrease in the fourth quarter compared to the third quarter due to shifting seasonality [1] - The oil market faces a negative outlook as winter approaches [1]

Geopolitical Risk Assessment - The US public desires a swift resolution to the conflict, similar to the Trump administration's approach [1] - There's a perception, supported by some evidence, that Iran is risk-averse in its actions [1] - Iran's capacity to significantly harm Israel or the US is considered limited [1] Oil Market Impact - The market is closely monitoring oil-related developments [1] - Iran's oil export capabilities remain largely unaffected by the US or Israel [2] - As long as Iran's oil exports are not targeted, a severe disruption of the Straits of Hormuz is deemed unlikely, preventing a significant oil price surge [2]

Oil Market Dynamics - Oil prices initially spiked following US strikes on Iran but later decreased [1] - US oil production direction is likely flat to down, despite potential incentives from higher oil prices [3] - Easing permitting processes in areas like Alaska could incentivize more drilling [6] - OPEC is adding 400,000 barrels a day, increasing global oil supply [7] Geopolitical Risks & Shipping - The Strait of Hormuz has never been closed, even during the Gulf War [8][9] - Increased risk in the Strait of Hormuz has led to shipping day rates rising from $24,000 to $100,000 per day [10] - Almost all exported Iranian oil is bought by China [11] - Potential disruptions could occur at Bab el Mandeb strait and the Suez Canal, in addition to the Strait of Hormuz [13] Iranian Oil & Sanctions - Iran exports 15 million barrels of oil a day, despite sanctions [15] - Disruption of the Strait of Hormuz would be economic suicide for Iran, as 90% of its oil is exported from Kharg Island [14]

Oil Market Dynamics - The recent surge in oil prices mirrors the speed observed during the Russia-Ukraine conflict, with a 25% increase since May 5th [2] - Market is pricing in real fear about spare capacity, driving aggressive price moves [6] - Global oil market is tightening towards less spare capacity [7] - OPEC increase announcements are being taken bullishly, reducing Saudi and others' spare capacity [8] Spare Capacity & Geopolitical Risk - SPR drawdown limits its availability as an option [4] - Saudi Arabia and UAE possess significant spare capacity, estimated at 2 million and 1 million barrels respectively [5] - Additional spare capacity from Kuwait, Iran, and Iraq could amount to another 1 million barrels [5] - Potential Iranian attacks on Saudi facilities pose a risk of further price spikes [14] - Strait of Hormuz closure would trigger a major crisis [16] Production & Capex - Producers proactively cut capex early, with Saudi Arabia reducing rigs [11] - US production might drop year-on-year for the first time since the pandemic [12] - Saudi Arabia is preparing for downside by lowering their own capex [14] Sanctions & Geopolitics - Significant amounts of oil, about 1 million barrels a day, are going to China via Car Island [9] - The administration may be turning a blind eye to sanctions enforcement to maintain lower oil prices [9]