RANT: OILOILOILOILOILOILOILOILOILOILOIOILOILOILOILOILOILOIOILOILOILOILOIL

   

HERE’S SOMETHING TO CONSIDER: Will the closure of the Strait of Hormuz by Iran to countries predominately aligned with American interests really cause serious disruptions for the economies of importing nations? Yes, potentially, as this chart from the JP Morgan banking group shows.👇The hashed circles display the chief importing countries in each region. The dates outlined for the various countries within each circle indicates the date when waterborne deliveries of crude oil will stop, i,e., when all the tankers currently at sea arrive at their destination and discharge their cargo. For example, deliveries from the Persian Gulf to the EU will mostly stop by April 10. China, which imports 5.2-million barrels per day (bpd) of oil will see its source of Persian Gulf crude cease around April 1 [That’s no joke! Ed.]

 

After that, the Chinese will have to use their strategic oil reserves to fuel  their economy or else source oil from other producers, and Russia would be the obvious place for it to pick up any shortfall in imports. Either way China is well-placed to deal with disruptions to its supply lines in the Gulf. It has between 80 to 120 days of reserves, with total inventories of over one-billion barrels to be released into the economy as needed.* SOUTH KOREA is prepared for a shutdown of Persian Gulf oil with strategic reserves of public and private holdings. It has between 200 to 254 days of crude in its stockpiles. On the other hand, the PHILIPPINES has no formal, strategic oil reserves. It gets 95% of its daily fuel from 'just-in-time' imports, and 25% of those imports comes from the Persian Gulf. It's economy is able to last 4-5 weeks before it runs out of petroleum and distillates. If the Gulf remains closed for an indefinite period of time, the Philippines will have to obtain alternate sources of oil, no doubt more expensive and within a shorter timeframe than, say, China or South Korea, or else face a serious public backlash. Already, nations are talking about rationing, asking their populations to conserve fuel whenever possible, with further restrictions envisioned down the road. (Covid-2.0)

IT WILL BE INTERESTING to see how Japan deals without Gulf oil, upon which it depends for 73% of its energy imports (Japan has zilch oil deposits on its territory). Perhaps it will make nice with the Russians and do some business together.

 

Asia, overall, will be hit hard by any disruption of Persian Gulf oil, importing, as it does, 84% of its fuel via the straits and 83% of its LNG (Liquified Natural Gas).¹ 

👉EVEN IF the war ended today, there would still be knock-on effects from closing the straits, and global supply chains in many economic sectors will be affected. High gasoline prices in America is one indicator, which is why the Trump administration quietly dropped its tariffs on Iranian and Russian oil shipments, in an bid to keep global stocks topped-up with enough crude to keep prices as low as possible. 

IN MARCH, the U.S. released 172-million barrels of crude from its strategic stocks. In addition, the IEA (International Energy Agency), a 32-member nation organisation that provides analysis, data, policy recommendations and real-world solutions for energy related problems, released 400-million barrels from its emergency reserves, also in March, for the same purpose—to keep oil prices down. How long this can continue is anyone’s guess.

 

👉BUT, IF YOU FUKTARDS HADN’T STARTED THIS FUCKING, STUPID WAR oil would still be in the price range that modern economies can handle, well below one-hundred-dollars per barrel, with adequate flows keeping everybody well lubed, ready, and steady.😟

    

CHEERS, JAKE. _____________________________________

 

* If things go pear-shaped, as they well might, then there will not only be delivery problems with oil from the Persian Gulf but also production problems. If attacks are made to Iran’s oil infrastructure, this would almost certainly trigger a proportionate response from Iran against Gulf countries it is in conflict with, damaging their oil fields, ports, and storage facilities in kind. Note that approximately 25% of global seaborne traffic in oil originates from the Gulf, most of it destined for Asian markets. An attack on Iran’s Kharg Island, which has extensive oil facilities, would almost certainly precipitate a destabilizing tit-for-tat escalation of the war. 

 

¹ INTERESTING NOTE: A couple of days ago, a China bound oil tanker the Al Salmi was hit by a drone as it was leaving Dubai waters. It was presumably fired on by Iran. Perhaps it was attacked because it was a Kuwaiti-registered vessel and therefore considered property of a hostile nation and a legitimate target for Iran. Or, perhaps the captain of the vessel refused to pay the new transit fee. Or, maybe it was a "false flag" attack designed to throw shade on Iran and escalate the conflict. Who knows; it's "fog of war" time, again. 

FURTHER NOTE: Iran has begun charging transit fees for all vessels passing through the Strait of Hormuz, a practice that will net it billions annually. So it goes.

 

  

QUOTES: Pete Hegseth, U.S. "Secretary of War"*

 

IN HIS IRAN WAR UPDATE during a March 24 White House press conference, Pete Hegseth, the self-styled “Secretary of War”*, in another of his speechifying fever dreams, proffered this boner:  

 

”We negotiate with bombs.”

 

 

 When will these people learn to shut-up?

 

 CHEERS, 

JAKE.😂 ________________________________________________

 

* As I understand it, the title “Secretary of War” and renaming the Department of Defence as the “Department of War” do not have legal standing. Any change to Cabinet and department titles must be voted on in the American legislature. This was not done. But puffed-up peacocks like Hegseth can’t be bothered by a little thing like the American Constitution. I think Hegseth would make a fetching entrance before the cameras dressed as Darth Vader. "Darth Pete". It has a nice ring to it, don’t you think?💀

 

FUN FACT: “In 2018 Hegseth’s mother, Penelope, sent him an email that said: ‘You are an abuser of women – that is the ugly truth, and I have no respect for any man that belittles, lies, cheats, sleeps around, and uses women for his own power and ego. You are that man (and have been for years) and as your mother, it pains me and embarrasses me to say that, but it is the sad, sad truth.’” (Guardian)

👉Me thinks the dear boy has some mommy issues to work through. Perhaps he should return to being a Fox News weekend newscaster. We'd all be the better for it if that happens.😆