OIL IS AT $111 AND THE LAST STEP OF THIS CHAIN IS A LOCKDOWN. HERE IS HOW WE GET THERE.
This is not the war story.
This is the chain reaction.
Step 1 — The Strait of Hormuz has been blocked since February 28. That is Day 64.
Step 2 — Tanker traffic has collapsed from 120 ships per day to as few as 3.
Step 3 — 14,000,000 barrels per day of oil supply is gone. The IEA calls it "the largest disruption in the history of the oil market."
Step 4 — Brent at $111. United Airlines planning for $175 through end of 2027.
Step 5 — United cuts 5% of its summer schedule this week.
Step 6 — Diesel at $5.38. Trucking costs explode. Every grocery price moves with diesel.
Step 7 — Fertilizer prices up 40% in one month. 1/3 of global seaborne fertilizer trade goes through that strait. Crop yields in India and Brazil already projected lower.
Step 8 — California gas at $6+. National average $4.39 — a wartime high.
Step 9 — South Korea rations. Bangladesh rations. The Philippines declares emergency. Australia tells citizens to "drive less." Japan asks the public to cut gas use.
Step 10 — They stop "asking."
Step 11 — They start telling.
Step 12 — They tell you to "stay home unless essential."
That is COVID with a different cover story.
They will never call it a lockdown.
It does not need to be called a lockdown to be one.
I’ll share more updates shortly. Turn on notifications, this is very important.
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