Oil's Deep Backwardation Is Almost Gone
The cost of a real-world oil cargo is dropping fast as buyers back away, in a dramatic reversal from last month’s bidding frenzy despite the ongoing closure of the Strait of Hormuz.
....Dubai crude market, trading has shifted to dates so prompt that typical benchmark-setting mechanisms for supplies two months ahead have become devoid of activity — adding to the appearance of depressed prices even as the market is still dealing with unprecedented scarcity.
Europe’s spring maintenance season is due to wrap up soon, potentially reviving demand for June cargoes, according to the traders...
“We’ve drilled a hole, a billion barrels worth of a hole, and we’re going deeper and deeper"
The cost of a real-world oil cargo is dropping fast as buyers back away, in a dramatic reversal from last month’s bidding frenzy despite the ongoing closure of the Strait of Hormuz.
....Dubai crude market, trading has shifted to dates so prompt that typical benchmark-setting mechanisms for supplies two months ahead have become devoid of activity — adding to the appearance of depressed prices even as the market is still dealing with unprecedented scarcity.
Europe’s spring maintenance season is due to wrap up soon, potentially reviving demand for June cargoes, according to the traders...
“We’ve drilled a hole, a billion barrels worth of a hole, and we’re going deeper and deeper"
Berkshire and SoftBank are refugees in each other’s countries.
https://www.economist.com/business/2026/05/06/only-one-of-berkshire-hathaway-and-softbank-can-survive
https://www.economist.com/business/2026/05/06/only-one-of-berkshire-hathaway-and-softbank-can-survive
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AN IT EMPLOYEES’ BODY HAS ASKED THE INDIAN GOVERNMENT TO MANDATE WORK-FROM-HOME FOR INDIA’S 5.8 MILLION TECH WORKFORCE FOLLOWING THE PRIME MINISTER’S MESSAGE: ECONOMIC TIMES
LETTER CITES COVID-19 PANDEMIC AS PROOF OF SEAMLESS WFH OPERATIONS
LETTER CITES COVID-19 PANDEMIC AS PROOF OF SEAMLESS WFH OPERATIONS
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IRAN SAYS IT WILL LEAVE NUCLEAR PROGRAM DECISIONS UNTIL ‘TIME IS RIGHT’
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Another Qatar-owned LNG tanker tried to cross Strait of Hormuz today but has U-turned and then stopped for now
Context: https://t.me/MonitoringSituation/4955
Context: https://t.me/MonitoringSituation/4955
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IRAN SAYS DEPLOYED DEEP-ROAMING SUBMARINES IN STRAIT OF HORMUZ
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TRUMP TO FOX: I AM CONSIDERING RENEWING PROJECT FREEDOM
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ELON MUSK, APPLE'S COOK, META'S MCCORMICK, CISCO'S ROBBINS, GOLDMAN SACHS' SOLOMON, AND BLACKROCK'S FINK ARE GOING TO GO TO CHINA WITH TRUMP
*BUT NOT NVIDIA CEO HUANG
*BUT NOT NVIDIA CEO HUANG
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TRUMP: PROJECT FREEDOM WOULD BE PART OF LARGER OPERATION
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TRUMP SAYS WE WILL HIT IRAN THEY HAVE NOT SEEN BEFORE IF DEAL IS NOT REACHED
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Monitoring The Situation
Why is the Price of Oil Not Higher? cc Morgan Stanley / JB
“Even if the strait reopened tomorrow, the time required to restart fields, repair refineries and reposition tanker tonnage means the market is on track to lose another billion barrels over the balance of 2026,” they said
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In short, America’s selling while China ain’t buying
US exports and China-led cautious buying patterns among importers have, in effect, been shielding the world from the supply shock. The actions of cautious buyers have therefore exceeded, by 4.1mn barrels a day, the 6.8mn net contraction of seaborne export supply estimated by Morgan Stanley,
Can China maintain import flows at the current low levels for as long as the Strait remains closed? Morgan Stanley says maybe (lack of data cited)
And can the US maintain the current pace of exports? Morgan Stanley says possibly not
(Looks like even MS not expecting SOH opening before June)
The "Buffer" is Working (For Now) BUT Clock Is Ticking
And If the Strait of Hormuz stays closed into late June, then U.S. will have to stop exporting to protect its own supply, and China will eventually run out of stored oil
US exports and China-led cautious buying patterns among importers have, in effect, been shielding the world from the supply shock. The actions of cautious buyers have therefore exceeded, by 4.1mn barrels a day, the 6.8mn net contraction of seaborne export supply estimated by Morgan Stanley,
Can China maintain import flows at the current low levels for as long as the Strait remains closed? Morgan Stanley says maybe (lack of data cited)
And can the US maintain the current pace of exports? Morgan Stanley says possibly not
(Looks like even MS not expecting SOH opening before June)
The "Buffer" is Working (For Now) BUT Clock Is Ticking
And If the Strait of Hormuz stays closed into late June, then U.S. will have to stop exporting to protect its own supply, and China will eventually run out of stored oil
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