Yimin X
Founder of YX Insights, Ex-FX/Rates Market Maker
Crude oil's war premium is unwinding for physical reasons, not sentiment. Saudi Arabia has restarted its East-West pipeline after the September 13 drone shutdown, and September exports are running above 4 million barrels a day, up from 2.4 million in August. Iran has signalled it could reopen the Strait of Hormuz within a week, if that can be trusted. Oil fell 11% over the past week, with the 100-day average the first real support. x.com x.comÂ
A possible US strike on Iran poses near-term upside risk for crude oil. If Trump expects to lose the midterms, he may act between Israel's October 27 election and the November 3 US vote. Crude has filled the $101 gap and reached the rising channel's midpoint; if it keeps breaking higher, the next levels are $105, $110 and the channel top near $115. x.comÂ
Crude oil has been suppressed for a long time and may be about to break higher. SPR releases and constant manipulative tweets have held WTI down, leaving Strategic Petroleum Reserve levels depleted. Oil is now driving interest rates tick for tick, which makes it the number one problem. x.com x.comÂ
Sustained high energy prices strain US farming, logistics, manufacturing and consumers, so crude oil should fall dramatically from its elevated level. Middle East and Russia tensions are lifting WTI, shown near $103, while Trump will likely step in at some point to reduce uncertainty. x.com x.comÂ
The crude oil cycle has just been reset. x.comÂ
Crude oil looks set to rally sharply because yesterday's Russia-Ukraine deal was not the price-lowering move expected before the midterms. Trump's plans are unclear, but the anticipated pre-election relief now seems less likely; premium gasoline cost over $5 at one Texas pump yesterday. Middle East peace could still avert the rally. x.com x.comÂ
A Trump tweet over the weekend is expected to bring crude oil down. The call also anticipates a sharp bounce on Monday. x.comÂ
Oil faces an explosive move up, likely into the midterms, as the supports holding prices down run out. Satellite images do not show the ships Axios's Barak Ravid claims are transiting Hormuz, and false reports of barrels have kept prices down so far. Most strategic reserve releases by the US and other countries are done and cannot be extended at current levels; when they run out, a big reason prices are contained goes with them. x.comÂ
Fears of US strikes on Iran could send crude oil to $200 quickly. FinanceLancelot reports that the USS Theodore Roosevelt is heading to the Middle East and says the move has revived concern that Trump will follow through on threats to hit Iran after the midterm elections. x.comÂ
Crude oil faces near-term pressure as Trump said US-Iran talks were productive and pledged no strikes before the November 3 elections; Brent fell to $103.36. Supply risks persist, however, with attacks on tankers near the Strait of Hormuz and 1.3 million barrels a day of Gulf of Mexico production shut in ahead of Hurricane Isaias. x.comÂ
Crude oil's 4 million-barrel-a-day global inventory draw despite weaker exports and refinery demand signals physical tightness. Chinese exports and refinery demand in Russia and China are each down a few million barrels a day, yet Brent is at a more than four-year high. Bessent says Persian Gulf exports exceed prewar levels, but cash and dated Brent trade well above front-month futures. Rising backwardation and inventory draws leave smaller buffers if escalation continues. x.com x.comÂ