FULL-BLOWN OIL SHOCK: 14.5 million barrels per day wiped out, 57% production decline across Gulf producers. US Treasury sanctions Hengli Petrochemical, China’s second-biggest refinery, cutting off 400,000 barrels per day from global financial system

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#URGENT THIS IS A FULL-BLOWN OIL SHOCK

14.5 MILLION BARRELS PER DAY — WIPED OUT. GONE.

The Gulf isn’t just disrupted… it’s crippled. Crude production has COLLAPSED by a staggering 57% in April, and even if the Strait of Hormuz reopens, recovery won’t be quick.

💣 Goldman Sachs warns: “FULL RESTORATION COULD TAKE MONTHS.”

Here’s the damage:
🇸🇦 Saudi Arabia: −4.0 mbd
🇮🇶 Iraq: −3.0 mbd
🇦🇪 UAE: −2.7 mbd
🇮🇷 Iran: −2.5 mbd
🇰🇼 Kuwait: −1.2 mbd
🇶🇦 Qatar: −1.0 mbd

And yet… the market is acting like reopening the Strait of Hormuz flips a switch.



The Largest Energy Shock On Record Is Worse Than You Think The Oil Deficit is Massive… And It’s Growing

The worst energy shock on record is far worse than you think. It’s time to take a careful look at the data.

Welcome, everyone, to this special Iran War report. I am the creator of The Crash Course, a multi-part video series that ties the economy to energy, and both of those to the environment (the Three E’s). The main conclusion of The Crash Course is that our system of debt-based fiat money is dangerously decoupled from the real world, and because it is, it will someday fail. It’s a case of fiction vs physics, and physics always wins.

Has that failure begun? I think it has. Is the failure picking up speed? It most certainly is, and oil is the lubricant.

Let’s make sure we’re all on the same page. I go over this in great detail in The Crash Course, but here’s the one slide that tells the tale. Oil and the economy are intimately related. Which makes sense, right? Raw material gets dug up out of the ground, which takes energy. They get transported and fashioned into other things, which takes energy. They are shipped to market, which takes energy. They are then bought by people who are sustained on food grown using a lot of energy.

Which is why this chart is so robust. The more GDP you have, the more oil you are burning. We can make the statement that all economic activity requires work to be performed. And that work uses energy. Which means we can strip out the middleman here and say that economic output is a function of energy.

Trump on Oil

On April 23rd, Trump said this:

Trump: “We are right now producing more oil than Saudi Arabia and Russian COMBINED! In about a year from now, we’ll be doing about DOUBLE that level. We don’t have an oil shortage. We have ‘drill, baby drill.’”

What’s astonishing is just how packed with falsehoods and misconceptions those three sentences are.

First, the claim that the US produces more oil than Saudi Arabia and Russia combined is not even remotely true. Here’s “End of Suburbia” with the facts:

What Trump probably got confused by is what I presented in the prior special report, where the term “oil” had been confused with “petroleum,” which no longer means what it did a few years ago. Now “petroleum” means everything from ethane, to propane, to butane, right on up to heavy sour crude. Which is dumb.