Today, John, Les, and special guest Clayton Seigle, Managing Director of Energy Practice at Beacon Global Strategies, take stock of the most significant oil supply disruption in recorded history — and why prices haven't fully reflected it, yet.
Since the outbreak of war with Iran six months ago, flows through the Strait of Hormuz have swung wildly, forcing emergency draws on the U.S. Strategic Petroleum Reserve and triggering sweeping demand cuts by Chinese refiners. The crisis has also exposed the hard limits of energy diversification: while Saudi Arabia could redirect exports through pre-built bypass pipelines, countries like Iraq and Qatar have few alternatives to Hormuz.
How long can the market absorb the disruption before prices rise sharply? How low is President Trump willing to let the Strategic Petroleum Reserve fall? To what extent has President Trump's been able to shape market expectations to actually suppress the price of oil, and is that sustainable?
The conversation also examines Ukrainian strikes on Russian refining capacity and the massive oil deal President Trump announced with Venezuela.
Check out the answers to these questions and more in this episode of Fault Lines.
@lestermunson
@johnclipsey
@ClaySeigle
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