No. of Recommendations: 13
rather than keep them high any longer.
I am mindful of the saying “prices rise like a rocket, come down like a feather”.
There are lots of reasons why this will be true in this case. China throttled its consumption by about 3m bbl per day during war. Expect that to go back up. The US and China both drew from their strategic stocks, the US level is now at its lowest point since the strategic reserve was established, so that will have to be refilled.
Countries which were severely impacted, Japan and those in Europe most notably, will be returning to their former habits; each time the price comes down a little, they will have an incentive to “buy more” which will tend to keep the price higher. This is also true of those factories which rely on oil not just for energy but also for feedstocks of plastics and other materials as were curtailed during the past several months.
I’m not saying that prices won’t come down, just that the glide curve will be much much slower than when it went the other way at the beginning of this absurd conflict. I would predict that the price of gas will still be higher on Election Day than it was at the beginning of the year. And I hope with the appropriate voter behavior rewarding the instigators of this nonsense.
