We know what’s coming and we are prepared.
🛢 Global crude markets that looked well-supplied in July are now facing an impending supply tightness and the market is still underpricing shortfall
For a brief window in mid-July, global crude markets looked well-supplied. After the US-Iran MoU was signed on June 17th, Hormuz transits picked up, Iran also managed to get barrels on the water, and Atlantic Basin exports hit record highs. Crude and condensates on water climbed above ~1.3 bn barrels by July 13th — matching the post-Covid, post-price-war peak of Q2 2020. It was, in hindsight, a false dawn.
Since that peak, Vortexa data shows a collapse in crude on the water of ~200mb in just four weeks — a draw rate of 7.1mbd. To put that in context: the equivalent draw in the four weeks after the Middle East war began in early March was 102mb. This most recent drawdown is 95% larger, and the market appears to have barely noticed. Summer trading lulls, seasonally lower price volatility, and the brief sense of comfort created by the July peak may have dulled the market's sensitivity to what the physical data is now pointing towards.
The immediate driver of the drawdown is a simultaneous collapse in exports from four of the world's most significant crude exporters. Combined seaborne exports from Iran, Russia (including Kazakh transit grades), Saudi Arabia, and the United States fell to approximately 12mbd — a record low, and a 5mbd drop from just one month prior. Relative to the pre-war February peak, the four-country aggregate is down ~6.7mbd on a four-week moving average basis.
Iranian exports fell to near zero following the re-imposition of the US blockade outside the Strait of Hormuz after the MoU collapsed in mid-July. Saudi exports dropped as both Hormuz and Bab el-Mandeb escalated — with Houthi threats intensifying and vessel availability into the Red Sea port of Yanbu reportedly constrained. Russian and Kazakh export flows continue to suffer from recurring Ukrainian drone attacks on Black Sea shipping and pipeline infrastructure. And US exports eased as SPR releases tapered, peak domestic refinery runs cut into exportable surplus, and arbitrage economics temporarily closed the Atlantic-to-Asia window.
🔗 https://www.vortexa.com/insights/crude-markets-underpricing-an-impending
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🛢📈 — Reuters reports that oil is approaching $100 per barrel following the latest exchange of attacks between Americans and Iranians on oil tankers.
▶️The price of Brent crude has risen to $97.07 per barrel, while American WTI crude has risen to $92.28. In the past week, Brent has risen by 7.8%, while WTI has risen by nearly 10%.
▶️On Saturday, U.S. forces attacked three Iranian oil tankers, one of which was stationed near the island of Kharg, a key center for Iranian oil exports. In response, the Islamic Revolutionary Guard Corps announced attacks on three oil tankers in the Strait of Hormuz and three more U.S. ships.
▶️In this context, traffic through the Strait of Hormuz has sharply declined. Over the past 10 days, an average of only 10 cargo ships have transited the strait per day – the lowest level since May.
The WHO now states on its website:
Vaccination against COVID-19 can trigger multiple sclerosis through cross-reactive CD4+-T cells that recognize the spike protein of SARS-CoV-2 and myelin peptides.
In other words: Your own immune system destroys the nerve pathways and then attacks your brain and spinal cord.
