Crude prices are up over 60% from November 1st and had a very strong rally this first week of February.
If you look at the chart above, prices stayed mostly range bound between 35 and 44 for the back half of 2020 after the Covid collapse. Prices were even trending downwards September through November.
All of this changed shortly after the election. After a minor lift off of 35 dollars a barrel, crude went on an unmitigated rally from 37 to today’s close at roughly 56.
Why is crude oil rallying when the IEA, among many agencies, have cut their oil demand forecasts for this year?
Global demand is down across the board and yet crude prices are rallying. The answer is 2 fold.
First, the monetary and fiscal stimulus is inflationary. It is hitting all commodities not just crude. Take a look at soy, wheat, corn, lumber, metals, etc. However, the inflation has been going on the entire time. The latest rally kicked off in November.
The second and more important reason that crude is rallying absent demand is that Biden made it clear that he was going to fuck over the US fossil fuels industry every way imaginable. Banning fracking, cancelling the XL pipeline, making it harder for the energy industry to do business in general, are all driving up the price of oil.
It is not even the summer driving season and the rally is underway. I would not be surprised to see 65 dollar oil and 4 dollars at the pump before the end of the year.
This will be a huge burden on the cash strapped consumer who already needed Covid relief stimulus checks.
The Biden Regime has been extremely vocal about their stance on fossil fuels and energy inflation will be an inescapable problem that they can not blame on Trump.
I know man, I just rewatched Breaking Bad over the last few months. I almost teared up seeing the $4 plus gasoline (ten years ago mind you!) and knowing it would be back by the end of the year.
Crude prices are up over 60% from November 1st and had a very strong rally this first week of February.
If you look at the chart above, prices stayed mostly range bound between 35 and 44 for the back half of 2020 after the Covid collapse. Prices were even trending downwards September through November.
All of this changed shortly after the election. After a minor lift off of 35 dollars a barrel, crude went on an unmitigated rally from 37 to today’s close at roughly 56.
Why is crude oil rallying when the IEA, among many agencies, have cut their oil demand forecasts for this year?
https://www.bloomberg.com/news/articles/2021-01-19/iea-cuts-oil-demand-forecast-as-new-lockdowns-temper-recovery
Global demand is down across the board and yet crude prices are rallying. The answer is 2 fold.
First, the monetary and fiscal stimulus is inflationary. It is hitting all commodities not just crude. Take a look at soy, wheat, corn, lumber, metals, etc. However, the inflation has been going on the entire time. The latest rally kicked off in November.
The second and more important reason that crude is rallying absent demand is that Biden made it clear that he was going to fuck over the US fossil fuels industry every way imaginable. Banning fracking, cancelling the XL pipeline, making it harder for the energy industry to do business in general, are all driving up the price of oil.
It is not even the summer driving season and the rally is underway. I would not be surprised to see 65 dollar oil and 4 dollars at the pump before the end of the year.
This will be a huge burden on the cash strapped consumer who already needed Covid relief stimulus checks.
The Biden Regime has been extremely vocal about their stance on fossil fuels and energy inflation will be an inescapable problem that they can not blame on Trump.
But there's going to be millions and millions of high paying jobs assembling and installing solar panels, riiiiight?
too bad they would have to pay 5 dollars a gallon to get to work
I know man, I just rewatched Breaking Bad over the last few months. I almost teared up seeing the $4 plus gasoline (ten years ago mind you!) and knowing it would be back by the end of the year.
I've only put 2000 miles on my car in the past 10 months. The lockdown is affecting demand.
yup. across the world fuel demand is down yet here we are with crude prices at pre covid levels and probably headed higher.