History demonstrates that oil crises rarely conclude when production recovers. The end comes when confidence returns, which is, at present, the scarcest commodity in global energy markets. Governments no longer assume that strategic reserves can be deployed repeatedly without consequence, while refiners start to question the resilience of just-in-time supply chains.
The irony is striking. SPRs were designed to prevent oil crises, but now could become one of the principal drivers of the next phase of higher oil prices. The world has not exhausted its petroleum resources. It has reduced its strategic flexibility. To rebuild that flexibility will require hundreds of millions of barrels, years of disciplined purchasing, and tens of billions of dollars. If renewed confrontation with Iran persists while governments, traders and refiners all attempt to restore their insurance coverage simultaneously, the next oil shock will not be driven solely by a lack of supply. It will be driven by intensified competition for every available barrel needed to rebuild the world's depleted energy safety net.
OilPrice.com
The Next Bull Market Could Be Built on Inventory Replenis...
The biggest threat is no longer lost supply, but the need for governments, refiners, and traders to rebuild depleted strategic and commercial oil inventories.
anyone think gas is going below $3 again in the next few years?
200 pages!!!
By
Crnr2Crnr ·
