Just about two months ago, JPMorgan did the math on “How Long Before The World Hits Crude Oil Operational Minimum.” The punchline was that while the market can hold hundreds of millions of barrels, it would still become fragile once working stocks fell too low. Like blood pressure in the human body, the issue is circulation.

 Long story short (and the long story can be found here), OECD commercial stocks could fall to operational stress levels by June, and then hit the global operational floor by September if the Strait of Hormuz remains closed, assuming demand destruction stabilized at 5.5 mbd (with oil prices paradoxically dropping since the last JPM article, demand destruction has actually slowed).

“The buffers and the shock absorbers are being steadily drawn down, and the ability for the market to absorb this imbalance is drastically diminished today versus where we started,” “Over the next few weeks, we’re likely to see those pressures flow through more directly to physical prices and there’s more upwards pressure that I would expect as we get into June and certainly into July.”

https://www.zerohedge.com/markets/approaching-unheard-inventory-levels-chevron-exxon-issue-apocalyptic-warning-about-what

 

A good example of FGC’s hysterics………..