ZeroHedge keeps finding little nuggets that get overlooked by other sources.
And this is one where CNN is actually doing the reporting, but glossing over the punchline, or perhaps just missing it?
But in the economic models the White House uses, they are actually running simulations that include crude oil at $200 per barrel and gasoline at $10/gallon. Why would they do that? Because it is very possible. Especially as we destroy our own economy to attempt to wreak havoc on the Russian economy. We are emptying our Strategic Petroleum Reserves in a political play to keep consumers happy but what happens if we empty those and need to actually go to war with Putin over Ukraine? Or with China over Taiwan?
Full story, with graphics at ZeroHedge:
www.zerohedge.com
And this is one where CNN is actually doing the reporting, but glossing over the punchline, or perhaps just missing it?
But in the economic models the White House uses, they are actually running simulations that include crude oil at $200 per barrel and gasoline at $10/gallon. Why would they do that? Because it is very possible. Especially as we destroy our own economy to attempt to wreak havoc on the Russian economy. We are emptying our Strategic Petroleum Reserves in a political play to keep consumers happy but what happens if we empty those and need to actually go to war with Putin over Ukraine? Or with China over Taiwan?
Full story, with graphics at ZeroHedge:
White House Is Quietly Modeling For $200 Oil "Shock" | ZeroHedge
ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero
www.zerohedge.com
. . . CNN's Phil Mattingly writes, "instead of managing an economy in the midst of a natural rotation away from recovery and into a stable period of growth, economic officials are analyzing and modeling worst-case scenarios like what the shock of gas prices hitting $200 per barrel may mean for the economy."
. . .
But unfortunately for Biden - and CNN which is hoping to reset expectations - it's only going to get worse, because as we noted moments ago, while nobody was paying attention, Cushing inventories dropped to just 1 million away from operational bottoms at roughly 20MM barrels. This means that the US is officially looking at tank bottoms.
. . . Bloomberg's chief energy guru Javier Blas notes, over the last 2 weeks, the US gov has drained 13.7 million barrels from the SPR, "and yet, commercial oil stockpiles still fell 3 million barrels over the period."
Just imagine, Blas asks rhetorically, "if the SPR wasn't there. Or what would happen post-Oct when sales end."
And here is the punchline: at the current record pace of SPR drainage, one way or another the Biden admin will have to end its artificial attempts to keep the price of oil lower some time in October (or risk entering a war with China over Taiwan with virtually no oil reserve). This means that unless Putin ends his war some time in the next 5 months, there is a non-trivial chance that oil will hit a record price around $200 - precisely the price the White House is bracing for - a few days before the midterms. While translates into $10+ gasoline.
