Posted on 06/17/2022 3:03:53 PM PDT by blam
Anxiety over a Fed-induced US recession – as the central bank battles stagflation – have prompted a plunge in prices in the energy complex.
With Atlanta Fed’s GDPNOW model now forecasting a recession has started – and inflation expectations rising – FedSpeak this morning confirmed their hawkish commitment to ‘whatever it takes’ to slay the inflation dragon, whether that means sparkjng a recession or not…
WTI prices fell back below $110, but remain above the Biden SPR plan levels…
Wholesale Gasoline prices are down hard this morning also…
The SPDR S&P Oil & Gas Exploration & Production ETF dropped 7.2% (entering bear market territory) and is on pace to fall for an eighth day, which would mark its worst string of declines since June 2020.
The S&P 500 Energy Index is down 16% this week and on pace for its worst weekly decline since March 2020’s COVID lockdowns.
While demand is expected to grow (as China re-opens), supply remains considerably restrained (and Biden’s muling of export bans are unlikely to help that supply situation), however, all the monetary jawboning this week has refocused traders in the short-term…
“Oil markets have focused on macro this week,” said Keshav Lohiya, founder of consultant Oilytics.
“However, we wonder what 25 basis point or even 50 basis point increases will do when the bulk of the inflation is coming from commodities.”
As the war in Ukraine continues, the focus remains on the extent to which Russian oil flows will be altered. On Friday, the country’s Deputy Prime Minister Alexander Novak said throughput at the nation’s refineries could fall 10% this year.
I’ve been watching the price. A few hours ago I ordered a fillup of my 250 gallon “job site” tank at my home. I’ll have to pay the price of the day I get it, and it should be in about a week. Hopefully I timed it well. At the current price it would be $1175. The last time I filled it, it was $550.
But my concern today is not how much it costs, but if fuel will even be “readily” available over the next year or so.
WE....
....are all gonna die.
Until then, share your treasure!
A week ago I was certain there was nothing the fed or anything else on the horizon could do to damper impending inflation.
Now I believe there’s nothing they can do to stop a debt/monetary implosion driven by complete demand destruction.
The inflation has reach a point where demand is being rapidly killed.
It’s apparent the fed/banks have stopped the air drop of money. And everyone is now standing around looking at one another wondering why their the one holding all that paper.
And selling the paper for whatever they can get for it, today.
Biden plans a Prohibition on Oil anyway
Good post.
I cant help but trust this is all an over reaction from Wednesday. We still are not increasing petrol output, Saudi is declining output. Russian is mainly selling to China and other bad guys. Demand from public is increasing for summer vacas. Industrial demand might reduce slightly, but not THIS much.
Next week prices bounce back up is my guess.
“In the Tibetan philosophy, Sylvia Plath sense of the word I know we’re all dying...”
Yes. I’m doing this more to cover us for the coming year. We live in a rural area and typically only occasionally do the 12 mile drive to downtown. In fact, I may use more fuel mowing my lawn. I use 5 gallons every week.
I suspect you are correct.
Yes, we’re on the brink and it won’t take a whole lot to drop off.
Biden will never re-fill the Strategic Petroleum Reserve which is now almost empty. IMO
China smiles...
It certainly is. And they’re in bad shape themselves.
This is good news. While very painful, and will take a long time, the Feds are letting inflation run hoping to kill demand. If this info is correct, it’s working on energy and oil. Other prices will follow.
The only reason gas isn’t higher is because China is playing covid games. Prices could be 10% plus right now.
““However, we wonder what 25 basis point or even 50 basis point increases will do when the bulk of the inflation is coming from commodities.””
Does this mean add 25 or 50 bucks to goods which will just add to inflation?
The left does not give a damned if oil, gas, food, housing, etc. go belly up and sink to the bottom of the ocean. They WANT all to crash. They WANT all these things to go bang and blown out of the water. The total destruction of America is their goal. Without that, no One World Order. They WANT a OWO. That is their goal. The more “hurt” people are the quicker they will TURN OVER THEIR RIGHTS to government!!!!!!! People will gladly give over guns, rights, freedom, you name it, for 6 weeks of free stuff and a 35 cents drop in the $5.50 gas at the pump gasoline we currently have. They will drive this nation into bankruptcy and not give a damned. Joe Biden will continue to be blamed, and that is the Left’s target also, as they know he is brain dead and won’t even understand or know that he is being USED!!! He is the free turkey at the OWO turkey fest. He is a braindead old fool. The November elections are the next target. Can they drive bankruptcy into view in time for the elections, to have Martial Law imposed by Pappy Braindead??? To ban the elections. Yada, yada, yada. That is all coming dear readers.
Does anyone here understand WTI August contracts that started today?
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