We know what’s coming and we are prepared.
🇺🇸🛢 The most visible oil inventories are about to plummet
Several things need to be noted first before looking at tanker data:
We are still offloading some of the tankers inbound laden with crude. These are temporarily keeping US crude imports elevated. The same VLCCs discharging crude turn into export volumes in 1-2 weeks.
We have an armada of empty VLCCs headed for the US, which will drain US commercial crude inventories dry.
All the while, we will continue to drain product inventories in the US. Petroleum product exports are expected to remain near all-time highs.
The snapshot above is our preliminary US crude storage estimate for next week, which includes 7.1 million bbls from the SPR. The final SPR release figure could be higher next Monday, so we will have finalized estimates out by then.
What’s not shown above is what happens to US commercial crude storage when 1) US refinery throughput ramps up to 16.8 to 17 million b/d and 2) US crude imports fall to 5.5 million b/d due to lower inbound crude flows.
The net impact on US commercial crude inventories by the middle of May is as high as 12 million bbls.
In essence, there could be EIA oil storage reports showing -10 to -12 million bbls of crude WITH a SPR release of 10 million bbls. This would put the cumulative crude draw at 20 to 22 million bbls.
And since I’m a numbers guy, let’s just say this. Since EIA started publishing the weekly oil data in 1982, there have been 41 weekly crude draws of over 10 million bbls. The largest ever recorded crude draw (commercial + SPR) was on the week of July 28, 2023, and this week’s EIA oil storage report (-13.355 million bbls) already ranks as the 6th largest crude draw in history.
I guess we are really doing this. We are really going to just watch the Strait of Hormuz stay closed, and onshore oil inventories plummet. US product storage is already approaching seasonal lows for this time of year, and the next few weeks will push us into brand-new territory.
I still see commentary about comparisons to 2022. The absurdity of those comments fails to recognize that this is not even remotely similar.
Police in Winona Minnesota are stunned after every single one of their Flock cameras were suddenly removed in a single night.
According to the police department, all 8 of the town's cameras were cut down and hauled away.
Police are asking for the public's help to identify the individual, but the public has been responding with comments such as:
"The Flock cameras tore themselves down"
"Whoever did it, was fishing with me"
"Whoever it was, was at Bible study with me"
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Nearly 20,000 people are publicly vouching for a man accused of cutting down Flock cameras in a small West Virginia town.
People commented:
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"He was saving my neighbor's dog from a fire all day, couldn't be him."
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"This man is innocent. I saw him serving at a soup kitchen."
-"Couldn't be him. He was helping me replace the roof on a homeless shelter."
The man, Wesley Jackson, has pleaded Not Guilty.
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US diesel crack surpasses $100 a barrel for the first time on supply disruptions
... and the supply of refined fuels is already nearly exhausted. A hard landing is visible ahead, for farmers, for trucking, and ... well, for everything that requires food (people) and energy (the entire economy).
These are very likely the final days of relative normalcy during which to prepare. Get ready.
🌾 🌍 🚜 JPMorgan warns a massive global food supply crisis could begin next year as fertilizer shortages tighten agricultural supply.
JPMorgan is the latest institutional research desk to warn that the next global food crisis may already be taking shape, driven by what its analysts describe as the "Five Ws": War, Weather, Warehousing, Water, and Waste.
In a new report titled Food Security Is National Security: A Compounding Storm, a team led by London-based senior global economist Nora Szentivanyi warned that disruptions around the Strait of Hormuz and the emergence of a potentially historic El Niño could weaken crop yields, constrain agricultural production, and keep food inflation elevated through the first half of 2027.
"Successive shocks since COVID have compounded, eroding food production capacity and keeping food price pressures elevated into 2027," Szentivanyi said, warning that "this is not a short-lived shock; it has reduced the likelihood of near-term disinflation, and the food ...
