Exports of crude from the strait of Hormuz have largely returned to levels seen before the outbreak of the Iran war, as oil producers and the shipping industry have found alternative ways of transporting crucial fuel out of the Middle East.
Not something I would have expected. Yes, sure, there will be workarounds, markets do that. But back to normal? Impresses even me that flexibility of markets.
Refined products not so much as yet. And I’d assume there are still considerable problems with LNG. But crude back to normal? Ho well…..
I made this point yesterday to someone who was under the impression that the US Navy were doing fuck all in the Gulf (I think the phrase was ‘cowering 1000kms offshore’).
Like so many wars – and so much else – this is being fought at least as much in the media as anywhere else.
Orange Man Bad can’t do anything right, apart from all the stuff, because the media needs Big Government cash and Trump refuses the symbiosis that almost all other politicians enthusiastically service.
He appears to have little interest in back scratching so all they can do is lie about him, exaggerate any problems and, increasingly, refuse to report his many successes.
Effectively if you start from the position that anything published about him in most media is 180° from the truth and work from there you won’t go far wrong.
US sites I follow say that the US has obliterated Iran’s coastal radar stations, and they’re effectively “blind” to what’s going on in the Strait. Thanks to this the US Navy are escorting nightly tanker convoys close to the southern edge, which is also beyond the visual horizon from Iran. Another report said that a new route has been opened up between two islands at the northern tip of the UAE, giving shipping greater protection than staying in the Strait itself. This is why crude oil exports are nearly back to “normal”.
You must be bonkers, “Orange Man Bad can’t do anything right” indeed. I suppose it spares you the agony of thinking for yourself.
Trump has been a superb president on domestic matters: again and again he has improved things. But his foreign policy has been appalling.
You may care to tell me, for instance, where his navy is at the moment – you’re surely not claiming it’s imposing a close blockade on the Strait. It’s a bloody huge distance out at sea because it daren’t get anywhere near the Iranian shore. Where are his bombers? Still not prepared to enter Iranian airspace in spite of Trump’s claim back in February that he had destroyed Iran’s air defences. Where are his in-flight refuelling tankers and his AWACS planes? What has he got to replace all his ground-based radar installations that have been destroyed, and his Gulf naval base? Come to that, where are his spare Tomahawks and Patriot missiles? It’s been a disaster even for people who are really keen to believe that crude shipments are back to normal. Me, I have no idea whether they are: both sides lie all the time so God knows what level the shipments are at.
But it’s harder to disguise inactivity which is why the lack of current US attacks on Iran is so striking and so contrary to months’ worth of empty boasting by Trump.
Trump’s only hope (in my guess) is that the revolutionaries who have been in charge of Iran for decades will have enriched themselves and at some point may come to fear that they are going to lose the lot. Then they may be prepared to negotiate. When, if ever, will that point be reached? God knows. Once again inactivity is striking: why hasn’t Trump being trying specifically to attack their wealth? Why aren’t all their houses in ruins? Presumably because his power to do so without ruinous loss of aircrew is so limited.
duplicate sorry
Ah yes, it was you to whom I made the point yesterday – when you were ‘excused the agony of thinking for yourself’ by saying that Tulsi Gabbard was said by a journalist to have said something to Trump, and it must be correct because no-one had leaked anything to the contrary.
Warships turn off their AIS transponders when they’re on active service, for obvious reasons.
If I could give you their precise locations that would be absurd.
It’s you who claims to know their locations – ‘cowering 1000 kms offshore’.
But I’m not quite sure what point you’re trying to make?
The US Navy has broken Iran’s blockade and imposed one of its own (on Iran) – the Kpler data isn’t hard to find.
They cannot do that from any significant distance, as anyone prepared to undergo the agony of thinking for himself would quickly realise.
ie they’re in the Strait.
Uhm, ‘bloody huge distance out to sea’? The strait is 24-60miles wide. The bombers have been entering Iranian airspace nearly at will for months. His in-flight refuelling tankers and AWACS are on the carriers and in the air.
He didn’t have any ground-based radar systems. None of our bases in the ME are like that. The spare Tomahawks are on the ships. The Patriots are wherever the Army has them.
You . . . do not understand what is going on.
Yes, this war has been a really bad idea. But not because the US military isn’t capable of blowing things up. Its because blowing things up and killing people is not what wins war. Its because we blew up the people who could force a surrender of their forces.
Its because we’re now fighting a bunch of low-level officers, each of who is raring to gain cred and reputation and build up their own power. None of them have control over the others and each of them has incentive to be more aggressive than the others.
We are more than capable of blowing up anything the Iranians bring up, what we aren’t capable of doing is stopping them from bringing more up.
>Trump’s only hope (in my guess) is that the revolutionaries who have been in charge of Iran for decades will have enriched themselves
Those guys are already dead. We killed them in the first days. We killed their successors in the first week.
If the volumes are back to normal, why is the price of oil still elevated?
It is on its way down, though.
Reductions always take longer than increases.
Not sure this is the case.
Lots of commentators were predicting $150 per barrel and the POO has been very reluctant to stay above $100 even when the volumes were definitely lower.
The reason given then was demand destruction and releases of strategic reserves – especially the Chinese who reveal a very large holding designed to survive a US blockade of the Strait of Malacca.
Winter is coming, reserves are empty and demand is recovering. Not usually when prices drop…
Some of the problem is lack of refining. The Chinese have restricted diesel exports because of the problem and Ukraine has had a successful campaign against Russian refineries.
Of course our own virtue signalling has led to us shutting down refineries which means we have to rely on imports aka the kindness of others when the shit hits the fan. See also electricity imports from Norway who are getting mightily pissed off with us for putting their own grid at risk.
“Lots of commentators were predicting $150 per barrel”
And one potato shaped commentator was confidently predicting in the spring that oil would be $200 a barrel by June.
Of course he also predicted that stock markets could have fallen by 50% by then and that Bitcoin would be worthless.
Don’t worry, a new prediction will be along shortly.
I’m sure someone will ask him about this at the big event. He loves debate after all.
Volumes are back(ish) because the price of crude is elevated. Smaller ships running through the pinch point, then doing a ship-to-ship transfer to a normal-sized tanker the other side. Adds cost and complexity. Insurance/risk on ships transiting, plus danger money for the crews.
These costs are feasible because Brent is high, while the port price in Saudi/Kuwait/Iraq/etc. will be lower than it was in February.
Also earlier reductions were in part made possible because of the Red Sea Route which the various pro Palestinians in the Left wing parties, all of whom are direct traitors have encouraged the Renegade Houthis to block off. But increases are brought in more quickly than decreases, as Otto point out below…
It’s a relatively recent return to near-normal, it still has to reach refineries, Hormuz is only one route (eg the Houthis are active in the Red Sea), and inventories are depleted and have to be rebuilt (they’re currently apparently around 2003 levels). That will will take months.
It’s a relatively recent return to near-normal, it still has to reach refineries,
Except that as I say above, refining capacity is down so it will take longer than normal, especially if governments start to stockpile as well.
I recently bought some Wizz Air, Carnival and Norwegian cruise shares. None of them hedge fuel much, so heavily beaten down since the war started (around 30%). I figured the situation couldn’t get much worse, and if oil is expensive enough, there’s the incentive to pump more elsewhere, pay tanker drivers triple overtime to drive day and night getting it out over land, or to hire some people to shoot at Houthis and get it out through the Red Sea.
Also, WH Smith has taken a pounding, but may be more problems in the business there.
Still hasn’t moved a lot, still an opportunity.
Shares in those cruise firms are going to fall off a cliff when the boomers all start kicking the B.
I’m not going to be in them for long
“The impossible just takes a little longer.”
Can chaps around here enlighten me. News reports keep going on about “months of reserves of diesel” and “releasing reserves”. I thought diesel fuel “went off” it you stored it for too long. Surely you can’t have “six months of reserves” with six-month-old fuel. If I was engineering a system the “reserves” would be a throughput not storage. Every week you buy 100m gallons from the market and sell 100m of last week’s from your stores. “Releasing reserves” would be a combination of buy less this week and sell more of the stuff you bought last week.
Fuel stabiliser can give it a life of 18 months or more.
The reserves are only 90 days’ worth and they’re retained by wholesales (I think) so it pretty much does operate on the rolling reserve basis you suggest.
This has been a meme on the interwebs recently, that gasoline (rather than diesel oil) degrades quite quickly, but I’m fairly sure that it lasts for years.
What say others?
Petrol used to last longer but it’s now got a load of ethanol in it which is hydroscopic and breaks down into sticky deposits, so can’t be left unused for long.
Chalk up another win for eco lunacy!
Er, hygroscopic that is.
I believe that was the reason for the ‘petrol shortage’ towards the end of the covid ‘pandemic / terror’. They needed to offload all the petrol that had been sitting unused due to lockdowns so a shortage was ‘engineered’ to get everyone to fill up their cars with petrol.
I trust the government. To lie about everything…..