🇺🇸🇮🇷 The Iran war’s real economic shock is only arriving now
For months, the world had a cushion.
Oil already at sea kept arriving. Countries drew down strategic reserves. Saudi Arabia still had its east-west pipeline feeding the Red Sea.
Larry Johnson says those buffers are now disappearing.
The oil that left before and during the brief lull has largely reached its destination. Strategic reserves have been drawn down. And the Saudi east-west pipeline, one of the most important routes bypassing Hormuz, is now offline after being attacked.
That is why the fuel crisis can get worse even months after the initial fighting.
Chevron CEO Mike Wirth is quoted in the discussion warning that many of the buffers that initially protected markets have now been exhausted. Diesel has meanwhile climbed above $6 a gallon, while Saudi Arabia is warning customers that shipments will be cut.
And the next buffer is being pushed hard.
U.S. refineries have reportedly operated above 95% utilization for 11 consecutive weeks, delaying maintenance to compensate for the global shortage, increasing the risk of breakdowns and unplanned outages.
Johnson’s point is simple: the energy crisis did not disappear. It was simply traveling through the system.
Now it is arriving.
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