Yup, the same thing is happening with Canadian Crude oil being shipped from Vancouver to China.
You’ll never see $70 oil again.
- Thread starter Snagglefoot
- Start date
The difference is, most other businesses don't determine their prices based on feelings...
New Persian saying “ once European airports have no jet fuel, you will know what it is the wear the slippers of a gypsy. “ 
Exxon’s first quarter is in. Their upstream earnings were down from last years first quarter. Someone else can comment but there was a bit of hand waving going on and it seems some of the volumes curtailed by the Hormuz issues actually belonged to Exxon. The details on hedge losses weren’t obvious but would been there. All in all, the market got excited but the reality was the upstream profits were not a good as last year.
I'm told there is no mess. Nothing to see here.
"Chevron CEO Mike Wirth declared on May 4, 2026, that the global energy system is under "extreme stress," with physical supply shortages now move from a "tail risk" to a "base case" reality.
Speaking at the Milken Institute as the U.S.-Israel war with Iran enters its third month, Wirth highlighted the catastrophic impact of the Strait of Hormuz closure, a choke point for 20% of the world’s oil. The crisis has already devastated the aviation industry: Spirit Airlines went out of business over the weekend, and major carriers like Lufthansa and KLM have gutted schedules, with jet fuel prices hitting a staggering $180 per barrel. "It’s not flowing today," Wirth told Face the Nation, noting that while Asia and Europe are being "steamrolled" first, the U.S. is not exempt. "We will start to see physical shortages," Wirth warned. "Demand needs to move to meet supply... Economies are going to have to slow."
The reality of a "global market" means that even with record U.S. exports, American refiners are now in a bidding war with the rest of the world for the same dwindling barrels. With the last scheduled shipment from the Gulf currently offloading at the Port of Long Beach, Wirth warned that the disruption is "potentially as big as the 1970s." As global strategic reserves are "absorbed" to mask the true deficit, the CEO of the company with operations from Venezuela to Kazakhstan is making it clear: the era of cheap, abundant energy has hit a wall. For American families, the message is blunt, energy independence does not provide a shield from a global shortage, and the "price of survival" in this market is going significantly higher.
"Chevron CEO Mike Wirth declared on May 4, 2026, that the global energy system is under "extreme stress," with physical supply shortages now move from a "tail risk" to a "base case" reality.
Speaking at the Milken Institute as the U.S.-Israel war with Iran enters its third month, Wirth highlighted the catastrophic impact of the Strait of Hormuz closure, a choke point for 20% of the world’s oil. The crisis has already devastated the aviation industry: Spirit Airlines went out of business over the weekend, and major carriers like Lufthansa and KLM have gutted schedules, with jet fuel prices hitting a staggering $180 per barrel. "It’s not flowing today," Wirth told Face the Nation, noting that while Asia and Europe are being "steamrolled" first, the U.S. is not exempt. "We will start to see physical shortages," Wirth warned. "Demand needs to move to meet supply... Economies are going to have to slow."
The reality of a "global market" means that even with record U.S. exports, American refiners are now in a bidding war with the rest of the world for the same dwindling barrels. With the last scheduled shipment from the Gulf currently offloading at the Port of Long Beach, Wirth warned that the disruption is "potentially as big as the 1970s." As global strategic reserves are "absorbed" to mask the true deficit, the CEO of the company with operations from Venezuela to Kazakhstan is making it clear: the era of cheap, abundant energy has hit a wall. For American families, the message is blunt, energy independence does not provide a shield from a global shortage, and the "price of survival" in this market is going significantly higher.
I am not saying oil is going up or down - simply pointing out that the CEO of a supermajor oil company isn't likely an unbiased source.
And professors don't live or work in the real world and have resorted to social media clicks hence the hyperbole.
True, but I'd take a CEO of an oil companies word over Joe Schmoe on xyz network.
The market doesn't seem concerned as of now.
That’s the fascinating bit.True, but I'd take a CEO of an oil companies word over Joe Schmoe on xyz network.
The market doesn't seem concerned as of now.
“Aviation Industry Gutted” - well, Spirit was destined for failure with $70 oil, so that’s not a relevant data point. Delta and United stock are up, and their schedules are intact.
So, this CEO got that part of the assessment wildly wrong.
Which calls into question some of the other parts.
Global Depression?
Maybe. Bears are always saying that, and usually, they’re wrong.
Overblown political junk
Well sure, but door number 3 is actually oil analysts that trade this stuff for a living and post what there doing for free.True, but I'd take a CEO of an oil companies word over Joe Schmoe on xyz network.
The market doesn't seem concerned as of now.
So far we have heard shortage in 30 days then 60 days. Now were at what - 70 something days?
We know supplies were tight at $60. We don't know what supplies look like at $90, or how long it will take to turn them on. Or how much demand destruction exists globally at $90.
Shortages always lead to gluts in the oil business.
El Erian's take
"1. Upside Surprise: Monthly job creation once again beat expectations. At 115,000, the April print was nearly double the consensus forecast.
2. Steady Unemployment: The unemployment rate held at 4.3%, as the consensus anticipated.
3. Moderate Wage Growth: At 0.2%, monthly growth in average earnings was slightly below the 0.3% consensus—a signal that counters fears of a tight labor market fueling a wage-price spiral.
4. Participation Friction: Instead of edging up toward 62.0%, the labor force participation rate came in at 61.8%.
5. Wash-out Revisions: While March’s blockbuster figure was revised higher, it was offset by a downward revision to February, leaving a net change of -16,000.
In sum, this data release confirms a resilient labor market despite recent headwinds from the Middle East War.
The demand side remains robust, while the supply side continues to navigate the dual issues of retirements and fewer immigrants.
And also drawing on other data from this week, what is "good news" for the financial markets and the Federal Reserve (muted earnings) risks amplifying concerns regarding the future economic, social and political implications of labor's declining share of GDP."
"1. Upside Surprise: Monthly job creation once again beat expectations. At 115,000, the April print was nearly double the consensus forecast.
2. Steady Unemployment: The unemployment rate held at 4.3%, as the consensus anticipated.
3. Moderate Wage Growth: At 0.2%, monthly growth in average earnings was slightly below the 0.3% consensus—a signal that counters fears of a tight labor market fueling a wage-price spiral.
4. Participation Friction: Instead of edging up toward 62.0%, the labor force participation rate came in at 61.8%.
5. Wash-out Revisions: While March’s blockbuster figure was revised higher, it was offset by a downward revision to February, leaving a net change of -16,000.
In sum, this data release confirms a resilient labor market despite recent headwinds from the Middle East War.
The demand side remains robust, while the supply side continues to navigate the dual issues of retirements and fewer immigrants.
And also drawing on other data from this week, what is "good news" for the financial markets and the Federal Reserve (muted earnings) risks amplifying concerns regarding the future economic, social and political implications of labor's declining share of GDP."
I just watch mr globals videos every day. He hasnt steered me wrong yet
We were doing an epic camping road trip in August 2005. When we filled up in Trail BC, regular was (IIRC) $1.059/litre. I took a photo because I'd never seen gas at over $1.00/ litre before.
By the time we got home, perhaps 10 days later, it was around $1.30. I think it peaked close to $1.50 on Labour Day weekend.
"Never" is a long time although not that long.
I remember back in 06 or 07 due to some Iraq related incident and manipulation oil price went to 100 or even 120, then over a few years drop to 60 due to fracking, then in Covid we get negative oil price.
I would never say "you will never see $70 oil again". However I would say gold would never be below $2000 / oz again for sure due to QE and inflation.
I remember back in 06 or 07 due to some Iraq related incident and manipulation oil price went to 100 or even 120, then over a few years drop to 60 due to fracking, then in Covid we get negative oil price.
I would never say "you will never see $70 oil again". However I would say gold would never be below $2000 / oz again for sure due to QE and inflation.
Professor Steve Keen. I take economists opinions with a grain of salt. Rarely if ever right. I've been hearing calls for recession the last 15 years.
"Markets are remarkably resilient right now.
That is not reassuring. That is the warning sign.
Markets under react first. Then they overcorrect. The Strait of Hormuz is not just oil.
It is 30% of global helium, 30-50% of fertilizer, half the world’s industrial sulphuric acid.
A 10% energy fall produces a 10% GDP fall. Great Depression scale. Bigger than 1973 and 1979 combined."
"Markets are remarkably resilient right now.
That is not reassuring. That is the warning sign.
Markets under react first. Then they overcorrect. The Strait of Hormuz is not just oil.
It is 30% of global helium, 30-50% of fertilizer, half the world’s industrial sulphuric acid.
A 10% energy fall produces a 10% GDP fall. Great Depression scale. Bigger than 1973 and 1979 combined."
"HUGE jump in US PPI inflation:
Powered by an eye-popping 1.4% rise in April, nearly triple the 0.5% consensus, the annual rate has hit 6% (crushing the 4.8% consensus forecast).
Core PPI followed suit, surging 1% (vs. 0.3% expected), bringing annual core inflation to 5.2% (consensus was 4.3%).
While the mapping isn't 1:1, these numbers strongly suggest that higher consumer inflation is still coming through the pipeline.'
Powered by an eye-popping 1.4% rise in April, nearly triple the 0.5% consensus, the annual rate has hit 6% (crushing the 4.8% consensus forecast).
Core PPI followed suit, surging 1% (vs. 0.3% expected), bringing annual core inflation to 5.2% (consensus was 4.3%).
While the mapping isn't 1:1, these numbers strongly suggest that higher consumer inflation is still coming through the pipeline.'
It actually is. Because the cost to extract a barrel of oil in constant dollars has been flat for about 25 years, coming down from real costs about 3x higher in the 1990s.
Real supply of oil is larger now than it was just 15 years ago. Technology is increasing supply faster than we are consuming it.
the myth that we’re running out of oil any time soon is similar to the myth of the “population bomb” nonsense pushed by Robert Ehrlich in his book of that name, and pushed by Malthusians to this day.
Yet contrary to Ehrlich’s gloomy predictions, the world has MORE food now and fewer people starving than ever before, and that’s with a population that’s doubled since he wrote his book.
What Ehrlich didn’t understand is that people have brains.
Intel and TSMC have announced Angstrom-level chip technology that will preserve Moore’s law long after “physics”says it must stop.
And SpaceX is re-inventing space travel with boring stainless steel rockets that all the “experts “ just knew could never work.
Humanity will never run out of oil for the same reason we didn’t kill all the whales for whale oil: items become too expensive before they disappear. Animal activists didn’t save the whales; Rockefeller and supply and demand did.
Never, say never. Fill 'er up.
I have consumed quite a bit of the news content that PBS affiliated stations have put out over the years, and I find your statement to be naive and suspect it is wholly unsupported by any credible evidence.
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