In short: RPK: physical ~$120 vs the ~$105 Brent contract rolling within a week — "they have to end up being kind of the same price," which "puts a sort of bullish cushion under the oil markets." Sam: the WTI trend signal sits down in the mid-90s, so even relief-driven dips can stay signal-bullish; diesel is tight everywhere and a hurricane or another refinery outage would tighten it further. The market is "a one-factor model market."
There are two oil prices: what a real barrel costs for delivery now (about $120, they say) and what futures contracts trade for (about $105 for Brent). Before a futures contract expires, the two have to meet. RPK expects them to meet somewhere in between, which puts a floor under the futures price. Hedgeye's trend signal for US crude stays bullish down to the mid-$90s, so even a relief dip wouldn't change the trend.
The bigger picture: as diesel hits $6.50 (and $10 in places), high prices start to destroy demand, which would slow the economy and eventually cool inflation. That is why they doubt the Fed will keep hiking in 2027.
8:25Now what'll be interesting is just to see the timing of all this and how this is going to show up in fractal patterns of the market, because — we talked about it before we got started — the physical markets are at 120, right? The forward market for Brent is like 105, call it, somewhere around there, and that contract at 104, 105 rolls in like a week or so, and that has to converge.
In short: Gold leads crude by ~19.8 months and "oil prices according to gold still have a lot further to go" — the uptrend is due to last until ~2028; commercials are only lightly net short above $100 ("they don't want to lock in these prices"), another sign of higher prices. "Higher for longer is the bet," sadly.
He has found that crude oil tends to repeat gold's ups and downs about 20 months later. Gold surged into January 2026, so on that clock oil should keep trending higher until around mid-2028, with pullbacks along the way. He will not name a price target.
A second check: the "commercials" in the futures market — mostly oil producers who sell future production ahead to lock in a price. When they hedge heavily, prices tend to top; right now, with oil over $100, they are reluctant to lock in, which suggests the people closest to the oil expect higher prices.
32:48This is the same time-offset practice that I was doing before. This one uses a 19.8-month offset just because with oil prices that's worked better historically. And this is a really long chart. This goes back all the way to 2014 to see that all the dance steps you get in gold, you get those same dance steps in crude oil prices.
In short: An inflation driver, not a trade: WTI "106 today," Brent higher, the SPR near the level where it physically can't be drawn further, global inventories at an all-time low, diesel $8 nationally ($9.99 in California), Costco rationing motor oil — "I don't see this energy price shock going away at all."
21:59And so you never can time it precisely but I would be surprised if there wasn't some sort of a shock, maybe it's an inflation shock, maybe a supply shock sometime in the next year. These oil prices have gone back above $100 — 106 today — and now on WTI and Brent's even higher and — and the strategic reserve is almost completely depleted.
In short: The reason to hike again in October: oil above $100, the SPR "driven down pretty heavily in this war" and close to the level where it can't be drawn, world reserves at an all-time low — knock-ons into fertilizer, sulfur, lubricants and record diesel ($9.99 in California).
11:55I think nobody knows what the Fed funds rate is and I would advocate for them to hike in October if the data stays the way it is. Particularly the commodity complex, the oil complex and all the knock-on effects that are just really starting to get critical. And I'm talking about the strategic petroleum reserve in the United States, which has been driven down pretty heavily in this war.
In short: Seasonal tactical trade flipped: normally short oil at Labor Day and buy at "the first snow in New York… December the 5th"; "this year, I think what you do is you long oil from here through to December the 5th," then sell if winter doesn't show. Expects "the oils to continue outperforming versus the S&P for a good six or seven more weeks." The China collar (~$80 floor, ~$100+ cap) is the brake.
Sankey's usual seasonal habit is to bet against oil after Labor Day and buy it back around the first New York snow, which he dates to December 5. This year he reverses it: own oil from now until December 5, because inventories have to be rebuilt for winter while supply keeps getting knocked out (the Saudi pipeline, Libya, Russia). He expects oil company stocks to beat the S&P 500 for another six or seven weeks, then he'll reassess. It is a time-boxed trade, not a permanent call.
His main brake is China, the world's biggest oil importer. He thinks China buys heavily when Brent falls toward $80 and pulls back above roughly $100, which creates a "collar." Separately, he sees real demand destruction at around $4.50 gasoline, or $120–130 Brent.
16:04And normally, we would be then be buying oils. This year, I think what you do is you long oil from here through to December the 5th, and then winter doesn't show up. Hopefully, it'll be warm for the sake of the global economy. And you'd actually be selling oil at that point. But for the next couple of months, I think everything I'm seeing is that we've got high demand for oil in the US, high prices of oil in the US.
In short: Cited as an inflation driver, not a trade: Brent "almost $100," the Strategic Petroleum Reserve drawn from ~750M to 287M barrels (lowest since the 1980s) and global inventories at record lows — a future SPR refill "is going to keep a floor under the price of oil and keep inflation stickier."
17:00We're now at the lowest level going back to the 80s when this thing started I guess. And we see that we're down [clears throat] to 287 million barrels; we were way up at 750. So, we're down by more than 50%. When they refill the Strategic Petroleum Reserve, which should happen at some point, that's going to keep a floor under the price of oil and keep inflation stickier than the Fed would probably like to see.
In short: "I think it will come down sharply. To me, it's not an if" — above $100 it "breaks stuff" (diesel ~$6, a record). The war pump is "the decision of one man"; US + Canada already run an ~8M b/d surplus, record output from Argentina, Brazil and Guyana, and Venezuela should double production in a year. "100 in the US is a decent peak" — the 2008 template was $147 to ~$40 by year-end.
Oil is above $100 because of the Iran war — in his words, "the decision of one man." At this price it "breaks stuff": diesel, which moves nearly every good in the economy, is at a record ~$6 a gallon, squeezing businesses and households.
He thinks the spike cannot last because supply in the Americas keeps growing: the US and Canada together already produce about 8 million barrels a day more than they use, Argentina, Brazil and Guyana are at records, and Venezuela could double its output within a year. High prices also crush demand. His model is 2008, when oil hit $147 and ended the year near $40 — so he expects a sharp fall; the only question is when.
16:38it could come down sharply anytime soon, Mike? — Well, I don't think it's, I think it will come down sharply. To me, it's not an if. Everybody gets that. It's a question because if it stays up and continues to go up, it breaks stuff. Diesel right now about $6 a gallon. The US is breaking stuff.
In short: The core call: spot is $91 but the forward curve is "still, depending on how far out you go, in the 70s or even 60s" — "way too low to incentivize enough investment even to keep oil production flat." Reserve replacement is running "something like a 10% replacement rate… essentially burning the furniture," global depletion is 7–10%/yr, and demand has risen at least 1%/yr for 40+ years. The marginal barrel needed just to stay flat costs "70 or 80 or $90," so "you need much higher prices… just to avoid a likely multi-year shortage," and shortages "get reconciled through demand destruction which is much much higher prices."
Oil wells die. Every year the world's existing fields produce 7–10% less than the year before just from natural decline, so the industry has to find and drill a huge amount of new oil simply to stand still. Right now it is replacing only about a tenth of what it pumps. Young's phrase for that is "burning the furniture" — you can keep warm for a while, but you're consuming the house.
The trap is that the price on the screen isn't the price that gets new wells drilled. Companies commit capital against the forward curve — what buyers will pay for delivery a year or three out — and that is still in the $60s and $70s even with oil at $91 today. His key distinction is between the cheapest barrel and the last barrel. Some wells really do work at $30. But the final, hardest barrel needed just to keep total production flat costs $70–90 to produce, so at today's forward prices producers lose money adding it — and so they don't. That is how a shortage gets built quietly, years before anyone sees it.
He also notes that averages lie. Oil spent roughly 90 days above $75 this year, but in scattered runs of ten and twenty days. Nobody sanctions a billion-dollar project off a price that keeps disappearing. And there's no demand relief coming: consumption has risen at least 1% a year for four decades, and in 160 years of commercial oil use it has fallen only a handful of times. When supply can't stretch, the shortage clears the only way it can — prices rise until some buyers simply stop buying. That is what "demand destruction" means, and it is the mechanism his whole call rests on.
The tell he is watching for the exit is unusual and worth remembering: he wants to sell into optimism, not into a price target. Today the market prices oil lower in the future than today (backwardation), which is the market saying "this won't last." When that flips — when future prices sit above today's, which is contango — the crowd will have turned bullish, capital will come back, and he says that is when he returns money to clients.
6:20But the forward curve is still, depending on how far out you go, in the 70s or even 60s. And these prices are way too low to incentivize enough investment even to keep oil production flat. And so I think you need a lot higher prices. And you need more certainty, too, where if you look at that chart just one more time and you see just how much volatility we saw just this year, that's not — Someone was asking me today, earlier today, hey Josh, why are you still bullish? What's it going to take for companies to drill? Oil's been on average over let's
In short: "Where do prices go from here? I suspect higher. I don't think we're out of the woods. I don't think we can write down the probability of tank bottoms to zero." Crude in the low $90s never exceeded its April–May high even though "unequivocally the global petroleum situation is much worse today, meaning much tighter" — because the only thing moving price all year "has been what your risk team is allowing you to short."
The puzzle he is answering is simple: about a tenth of the world's oil production has been switched off since March because tankers can't leave the Persian Gulf, and yet nothing has broken. Most people conclude there must have been far more oil sloshing around than anyone thought. Rozencwajg's answer is that the shortage is real, but it has been recorded in the wrong place.
Here is the mechanism. The world reports "demand" not by measuring what people burn, but largely by measuring how much crude goes into refineries — because normally refineries only run when there is a customer, so the two match. This year they came apart: refineries across the Gulf, in China and in Russia stopped running for reasons that have nothing to do with customers (war damage, trapped cargoes, a policy decision). Six million barrels a day of refining vanished, and the models dutifully reported five million barrels a day of "lost demand." Meanwhile people kept driving and flying. So the missing fuel is coming out of storage tanks nobody counts.
Why that matters for the oil price: crude at roughly $90 has never exceeded its April high even though the physical situation has got steadily worse, and the whole year's price action has been about how much risk committees let traders short, not about anyone being bullish. When the world eventually has to refill its fuel tanks, refineries will have to bid hard for crude — and there is still a real chance of "tank bottoms," a market with no cushion left at all. "Where do prices go from here? I suspect higher."
32:23This is something that people are going to talk bullishly about and push the price up. And you're at a $90 price without any of that having happened yet. And even if you look today, the short interest is quite high on a lot of this. So, where do prices go from here? I suspect higher. I don't think we're out of the woods. I don't think we can write down the probability of tank bottoms to zero.
In short: "I continue to think that the oil molecule is the mispriced asset." The primary mover of the crisis is 10 mb/d of upstream production turned off; the catch-up trade "is oil up to diesel," and refilling drained gasoline/diesel/jet tanks means "we're going to have to bid a lot of crude back into the refining system, and that's going to catch people off guard."
About 10 million barrels a day of oil — roughly one barrel in ten the world uses — has been stuck in the ground since early March because the tankers that carry it can't get out of the Persian Gulf. Over six months that adds up to well over a billion barrels of oil the world consumed but never produced. That gap has to be filled from storage, and Rozencwajg's central point is that the world does not actually have that much oil it can use: most of what gets reported as "inventory" is oil physically sitting inside pipelines and ships, which you can no more spend than a shop can spend the goods on its own shelves.
So why hasn't anything broken? Three reasons, all temporary. It takes about two months for missing barrels to show up in the data, so only three of the five reported months have felt it at all. A one-off convoy of about 100 million barrels escaped during the brief peace deal. And China, Russia and the Gulf all cut back their refineries, which quietly moved the shortage out of crude oil and into gasoline and diesel — where nobody measures inventories properly.
His conclusion is that crude is the cheap thing in the whole chain. When the world has to refill its emptied fuel tanks, refineries will have to bid hard for crude, and "the big catch up that's going to take place is oil up to diesel." He is not calling a trade on tomorrow's headline — he's saying the physical damage is already done and simply hasn't shown up yet.
51:03I don't think it's happened yet. I think the price has to go higher. And then the big catch up that's going to take place is oil up to diesel because there's no reason why that should stay the way it is other than this flotilla of oil that got out of the strait with the MOU and other than the fact that China is essentially transmitting the crude problem.
In short: Structurally long and not adding at the margin — but the action has left crude: crack spreads $60+, and "$83 on that crack spread, more than the price of crude" on one day, "tells you there's not enough refineries out there." Buy the petroleum indices, or refiners / producers / integrateds. Crude at ~$88 "hasn't done anything" while products sit near all-time highs.
The heart of the interview. A "crack spread" is simply the profit a refinery makes: what gasoline and diesel sell for, minus what the crude oil cost. Normally it's a few dollars. It has been running around $60, and on one day it hit $83 — more than the entire price of a barrel of crude. That is not a demand story; it means the world does not have enough refineries. Russia's have been bombed, some sit behind the blockaded straits, and China idled its own while coping with the crude shortage.
So his advice is to stop watching the crude price — "nobody consumes crude oil," people consume diesel and gasoline, and those are near record prices while crude sits around $88 doing nothing. The way to own it is the way he taught clients at Goldman: buy a broad basket (a petroleum index) rather than picking crude vs diesel vs gasoline, or on the stock side own refiners, producers, or integrated oil companies that do both.
One important caveat on his own positioning: he is already long energy and says he'd add nothing more at the margin here — his fresh money this week is going to precious metals. He also thinks the refining squeeze eventually pulls crude up, as Chinese teapot refiners chase the margin, "but right now they can't."
18:47Why would I go back to your point? We're trading 60 plus dollars. I think there was a day or two like a week or two ago we were $83 on that crack spread, more than the price of crude. That tells you there's not enough refineries out there. But more likely than not, you have the teapot refineries in China now chasing the margins.
In short: Hormuz crude/product flows fell from ~20 Mbbl/d to ~2 Mbbl/d in March; the IEA calls it the largest oil-supply disruption in the history of the global oil market. Brent climbed to a four-year high — the oil exists, but moving it on time and securely is what's scarce.
In short: Brent trading ~$100-110/bbl as Hormuz flows fell from ~20 Mbbl/d to ~2 Mbbl/d; the oil still exists — what's scarce is the ability to move it on time and securely, which is what the freight market is pricing.
In short: Brent finished April >55% above pre-conflict levels (IEA: "the largest oil supply disruption in history") — a price floor that turns once-expensive non-Middle-East extraction into "gold mines."
Because the Strait of Hormuz — the route for a fifth of the world's oil — is blocked, oil prices have jumped more than 55%. That high price acts like a floor that makes oil projects far from the Middle East suddenly very profitable. Prins's point is that the crisis doesn't destroy value, it moves it to producers and routes outside the conflict zone.
In short: WTI fell >16% on the April 8 ceasefire to ~$97 (from a $118 war peak). Gasoline drove ~75% of March's CPI jump but is already coming down — the inflation was confined to one line item and didn't spread.
Oil is the trigger in this story rather than a buy idea. It spiked during the war (gasoline jumped a record 21% in March), but the moment a ceasefire was announced on April 8, oil fell more than 16% in a single day. That's important because the gasoline-driven inflation that scared markets is already reversing — it just won't show up in the official numbers until later. As oil prices come back down, the pressure that pushed gold lower should ease.
In short: Near $100 — the inflationary oil shock is the very thing delaying the monetary easing that would amplify safe-haven buying; in each historical parallel an oil shock first suppressed metals before they recovered.
In short: The Strait of Hormuz (~⅕ of world oil) is the battleground — Iran is attacking tankers and may make safe passage conditional on yuan pricing. The IEA called the war "the largest supply disruption in the history of the global oil market"; ~700 ships sit in the Gulf with ~200M barrels.
In short: The Iran war sent oil to multi-year highs and halted Strait of Hormuz traffic (~20% of daily supply) after insurers pulled war-risk coverage — but the disruption is "real, but unlikely to last": 2025 output grew ~3M bpd and the prior surplus should return once insurance normalizes.
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Verbatim excerpts from the public transcripts (auto-pulled at each mention's timestamp, lightly cleaned). Timestamps link into the video; "source page" opens that commentator's full analysis at this row. Click a mention's header line to expand it (one open at a time). For personal study — not investment advice.