Eventually, yes. But 1) it's not a magic tap on/off, 2) refineries are specialized for specific types of oil, 3) a lot of ships are stuck there, 4) wells and refineries usually take a long time to restart.
Serious oil traders are saying it will take months or even more than a year to get back to normal.
The only thing containing prices at the moment is many exporters sold futures to lock-in prices for the rest of the year (it wasn't market manipulation as many suspected). But once they are sold out we'll have some interesting price discovery.
(LLMs are good at explaining the jargon). Shipping just got 3-4 times more expensive. Not just crude oil, also bulk, chemicals... There are not enough ships and there is not enough bunker diesel - normally costs 400$/t, now 1100$/t
But how? Iran is right next door. They can target any mode of getting oil out of there. Not just the strait of Hormuz but any pipelines that lead away from the region can just as easily be targeted. One Shahed to the pipeline is all it would take.
In theory yes, but in practice those drones would have to take a really long flight over enemy territory giving more opportunities to shoot them down. And it’s not like they are difficult to shoot down, they are cheap crap, their only advantage being that there’s a lot of them
You really haven’t been paying attention to Ukraine. You can launch them from trucks. from boats. You can make them so cheap defense becomes too costly. What people don’t seem to get is that you that much of modern infrastructure is not scalable to an age of war and chaos the US is unleashing in bid to shift power dynamics from economy (which China is winning) to military.
Pipelines have endless vulnerability surface as Ukraine showed and just do the math on trucks vs a super tanker.
> You can make them so cheap defense becomes too costly.
That's because the US chose to shoot them down with Patriot missles, like morons. Ukrainians have developed cheap interceptor drones for this very purpose.
As low tech as they are, they fly low, can’t really be detected by radar and you only need one to get through. Pipelines are long and can’t be protected.
Don’t forget the world needs LNG and the stuff made from petrochemicals such as fertilizer. They need to make chem plants as well as refineries to go with drilling new wells and run them harder. Get Venezuela up, but that’s probably O(years).
Is there enough copper and power to get those ev stations up in the us? Cuz now’s their chance.
There used to be conventions on not assinating leaders, or abducting them, commiting genocide, bombing water and hospitals, targeting journalists and birthday girls and boys, oh and destroying fuel infrastructure.
strait closed is only applicable for usa ally ships so ur country just needs to be neutral or iran ally.. for american its not applicable bc they have their own oil/venezuela
Tautologically yes. Whatever the world gets is its supply. Depending on how much can be done to bypass the Strait, that supply may diminish substantially. Already has, I suppose.
It would be nice if this was the thing that finally kicked governments into gear to get off our reliance on oil. But I don’t think 20% is quite big enough to make that happen.
Exactly. And also a solid chunk of the 20th century. "Starting a war" can be a bit of a fuzzy delineation, but reasonably-speaking, it's been over 60 years since a Democratic president started a war (Vietnam war in 1965). For whatever reason, these types of facts never seem to budge the "BOTH SIDES BAD" types, though.
This is ignoring fifty years of trying to start this war. Even blaming Israel doesn't entirely make sense. A large segment of capital in the US truly wants this war to happen (as foolish as that may seem to rational humans). It is not simply a distraction.
Or to put it another way, the Trump administration is characterized by dozens of scandals of bungled governance, each distracting from the next. Determining which is the "root" thing being distracted from is pointless.
Ok, so in your genius reality, did Biden start the Russia-Ukrainian war or the Israeli genocide? Or am I just too dumb and interpreting your oh-so-clever sentence wrong?
I'm also curious if you could explain the logic more than "Just so your own research man"...
Yea, other commenters on this thread got it, so think you misunderstood my point: no. Biden did not start any wars as far as I’m aware, which was the point I was trying to make: not only have there existed non-war-starting presidents, our previous president was one of them!
Eventually, yes. But 1) it's not a magic tap on/off, 2) refineries are specialized for specific types of oil, 3) a lot of ships are stuck there, 4) wells and refineries usually take a long time to restart.
Serious oil traders are saying it will take months or even more than a year to get back to normal.
The only thing containing prices at the moment is many exporters sold futures to lock-in prices for the rest of the year (it wasn't market manipulation as many suspected). But once they are sold out we'll have some interesting price discovery.
https://www.tradingview.com/symbols/ICEEUR-BRN1!/forward-cur...
https://www.tradingview.com/symbols/NYMEX-CL1!/forward-curve...
The ships shortage is an underreported problem. Follow this guy
https://nitter.net/ed_fin
(LLMs are good at explaining the jargon). Shipping just got 3-4 times more expensive. Not just crude oil, also bulk, chemicals... There are not enough ships and there is not enough bunker diesel - normally costs 400$/t, now 1100$/t
https://shipandbunker.com/prices/apac/ea/cn-hok-hong-kong
But how? Iran is right next door. They can target any mode of getting oil out of there. Not just the strait of Hormuz but any pipelines that lead away from the region can just as easily be targeted. One Shahed to the pipeline is all it would take.
At these higher prices you can safely bet other producers are drilling new wells, adding more infrastructure, and upgrading refineries.
That’s not going to replace the sheer volume of the Middle East.
Yes it can. It's only 20%. The difference is ME is very cheap to extract relative to other places like shale.
In theory yes, but in practice those drones would have to take a really long flight over enemy territory giving more opportunities to shoot them down. And it’s not like they are difficult to shoot down, they are cheap crap, their only advantage being that there’s a lot of them
You really haven’t been paying attention to Ukraine. You can launch them from trucks. from boats. You can make them so cheap defense becomes too costly. What people don’t seem to get is that you that much of modern infrastructure is not scalable to an age of war and chaos the US is unleashing in bid to shift power dynamics from economy (which China is winning) to military.
Pipelines have endless vulnerability surface as Ukraine showed and just do the math on trucks vs a super tanker.
> You can make them so cheap defense becomes too costly.
That's because the US chose to shoot them down with Patriot missles, like morons. Ukrainians have developed cheap interceptor drones for this very purpose.
There are also radar-guided anti-aircraft guns like this: https://en.wikipedia.org/wiki/Flakpanzer_Gepard
As low tech as they are, they fly low, can’t really be detected by radar and you only need one to get through. Pipelines are long and can’t be protected.
Why not? Put them in the ground instead of on the ground. Or put a heap of sand on them to absorb the blast.
all of this is assuming the US and israel will LET this new bypass go unhindered.
Don’t forget the world needs LNG and the stuff made from petrochemicals such as fertilizer. They need to make chem plants as well as refineries to go with drilling new wells and run them harder. Get Venezuela up, but that’s probably O(years).
Is there enough copper and power to get those ev stations up in the us? Cuz now’s their chance.
Recently submitted[1] related Bloomberg story:
Strikes on Qatar's LNG Ras Laffan plant Will Reshape the Future of Fossil Gas
[1]: https://news.ycombinator.com/item?id=47484246
There used to be conventions on not assinating leaders, or abducting them, commiting genocide, bombing water and hospitals, targeting journalists and birthday girls and boys, oh and destroying fuel infrastructure.
For a less simplistic look at a similar question I'd recommend this article.
https://hyperfocusinhalifax.substack.com/p/why-arent-oil-pri...
strait closed is only applicable for usa ally ships so ur country just needs to be neutral or iran ally.. for american its not applicable bc they have their own oil/venezuela
Tautologically yes. Whatever the world gets is its supply. Depending on how much can be done to bypass the Strait, that supply may diminish substantially. Already has, I suppose.
It would be nice if this was the thing that finally kicked governments into gear to get off our reliance on oil. But I don’t think 20% is quite big enough to make that happen.
By what banning driving?
Have you heard of electricity?
*Can the world have an American President that for once doesn't start pointless wars to distract from internal scandals?
It'd be nice if we could take a few years off from having a president at all - just rest, recover, and start to clean up the mess.
America needs a Snow Leopard. No new features, just bug fixes.
Every war in the 21st century that America has entered has been started by a Republican President
How are you defining war? Weren't Libya and Syria started under Obama?
Exactly. And also a solid chunk of the 20th century. "Starting a war" can be a bit of a fuzzy delineation, but reasonably-speaking, it's been over 60 years since a Democratic president started a war (Vietnam war in 1965). For whatever reason, these types of facts never seem to budge the "BOTH SIDES BAD" types, though.
> to distract from internal scandals
This is ignoring fifty years of trying to start this war. Even blaming Israel doesn't entirely make sense. A large segment of capital in the US truly wants this war to happen (as foolish as that may seem to rational humans). It is not simply a distraction.
Or to put it another way, the Trump administration is characterized by dozens of scandals of bungled governance, each distracting from the next. Determining which is the "root" thing being distracted from is pointless.
For once? Didn’t our previous president just clear this cynically low bar?
Ok, so in your genius reality, did Biden start the Russia-Ukrainian war or the Israeli genocide? Or am I just too dumb and interpreting your oh-so-clever sentence wrong?
I'm also curious if you could explain the logic more than "Just so your own research man"...
I think you’re responding to the wrong comment
You're reading them wrong and I'm not sure what you find clever about the wording.
The bar was a president that doesn't start pointless wars. That's a low bar. Biden cleared said low bar by not starting pointless wars.
Yea, other commenters on this thread got it, so think you misunderstood my point: no. Biden did not start any wars as far as I’m aware, which was the point I was trying to make: not only have there existed non-war-starting presidents, our previous president was one of them!
Is it possible yes, is it feasible absolutely not
[dead]
tl;dr https://en.wikipedia.org/wiki/Betteridge%27s_law_of_headline...
Many other things pass through the straight besides oil