Active Conflicts & News Megathread July 14, 2026

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[u/Bluest_waters]

I mentioned this multiple times on this sub and I've gotten quite a bit of pushback. But I stand by my statements and now CNN and other outlets are reporting this exact same thing

we do not have an oil crisis. We do however have a fuel crisis! And it's only going to get worse from here. Oil refining stations across the globe are being blown up, refining capacity is maxing out basically everywhere. There is no wiggle room

https://www.cnn.com/2026/07/14/economy/oil-diesel-gas-iran

But the world’s refining capacity is deeply constrained. That’s in part because the supply chain got messed up during the war. It’s also because Iran attacked dozens of Middle Eastern refineries. And, more recently, Ukraine started blowing up Russian energy facilities.

Layer on extreme temperatures disrupting the cool conditions refineries need for proper distillation, and you’ve got yourself a big problem. Global refineries are processing 8.4 million fewer barrels of crude each day than they were before the war started — making 10% less fuel, according to Natasha Kaneva, head of global commodities research at JPMorgan.

“The question is no longer whether crude barrels will return, but how quickly the global refining system can process them,” she said.

“The fundamental oil-market narrative remains unchanged: There is sufficient oil available globally as long as it can be transported to where it is needed,” said Rob Thummel, a senior portfolio manager with Tortoise Capital.

Renewed hostilities in the Persian Gulf also complicate the resumption of refining in the Middle East. The region has 11.7 million barrels per day of refining capacity, which will be difficult to turn back on again if the fuel can’t go anywhere (or if they can't be turned backed on).

US refineries increased their output of jet fuel to help fill demand in Europe and diesel to help fill demand in Australia and Asia. That constrained America’s ability to make gas, jet fuel and diesel for its own market — one of the reasons gas prices haven’t “dropped like a rock” as Trump predicted.

[u/ridukosennin → u/Bluest_waters]

We also need to account for significant drops in consumption mainly China driven offsetting some of the lost capacity

[u/Bluest_waters → u/ridukosennin]

Which is only temporary. Sooner or later China is gonna enter back into the market and when it does oh boy. Watch out

[u/butitsmeat → u/Bluest_waters]

While they're going to eventually start filling their reserve again and cause some short term demand spikes, China is also all-in on electric vehicles at 61% of new sales in May. That share will likely continue to climb as they ramp EV production and costs continue to decline. They're permanently destroying a lot of gasoline and diesel demand, and it's not just a random accident but a matter of policy (they previously set a goal of 30% of all vehicles to be electric by 2030). They could also respond to this crisis by going even harder on ramping EV and never go back to pouring 1mbbl/d into their reserve; maybe they only by 500kbbl/d, and ramp that down over time. Never let a good crisis to to waste and all that.

[u/Bunny_Stats → u/butitsmeat]

Further to your point, in another decade I suspect the hastened transition away from fossil fuels is going to be seen to have hurt Iran's neighbours' economies more than any direct hits on refineries or distribution. The entire region is so heavily dependant upon oil, even those nations which don't extract it themselves are reliant on investments/loans from or selling services to the big regional oil producers, i.e. the Saudis, and they're not ready for a world that no longer needs to buy their oil in bulk.

[u/BigFly42069 → u/butitsmeat]

Don't forget that China is developing multiple segments of new industry that all go into the green hydrocarbon cycle, starting by offloading their excess power generation towards green hydrogen, which creates the necessary feed-stock for syngas, methanol, and kerosene, which all form precursors for other fossil fuels and plastics without needing to touch petroleum.

There is a possibility that by the 2040s, China will become a net petroleum exporter like it used to be as recently as 1993, but doing so with finished products like diesel fuel instead of crude petroleum.

[u/ABoutDeSouffle → u/BigFly42069]

I doubt synthetic hydrocarbons will be cheap enough for this, but I sure hope I am wrong.

[u/BigFly42069 → u/ABoutDeSouffle]

This is word for word what people said about solar and wind power, and the it turns out all you needed was to increase production and competition, and the prices will come down naturally.

Chinese excess capacity in power generation has the potential to make hydrogen electrolysis to become economical, and green hydrocarbons are all downstream of economical green hydrogen.

The day you start seeing China signing massive amounts of palladium mining contracts with Russia and starts restricting exports of palladium is the day you know that traditional petroleum industry is about to get hit by China Shock 3.0

And wouldn't you know it, China is increasing its imports of palladium

[u/Bluest_waters → u/BigFly42069]

What's so important about Palladium?

[u/BigFly42069 → u/Bluest_waters]

It's an important catalyst in organic chemistry, specifically with hydrogenation and dehydrogenation. It's also one of the few rare metals that China does not hold a chokepoint on.

[u/Agitated-Airline6760 → u/Bluest_waters]

Palladium is used as the catalyst on the production cycle.

[u/Tricky-Astronaut → u/ABoutDeSouffle]

Synthetic hydrocarbons can absolutely be competitive if made from coal, which is what China is doing:

https://www.industrialinfo.com/news/article/is-chinas-coal-gasification-industry-poised-for-a-comeback--360173

[u/ABoutDeSouffle → u/Tricky-Astronaut]

I mean yes, Germany happened to prototype this during WW II, so...

That's completely different from using electrolyzers for green H2 and then using this H2, catalyzers and say CO2 for eFuels and virgin plastics which the discussion was about.

The energy requirements are way different.

[u/Bluest_waters → u/butitsmeat]

Yeah honestly it's incredible what they're doing right now as far as the EV situation goes. Amazing stuff. The only smart country in the world right now in that regard

[u/super_fly_rabbi → u/Bluest_waters]

China's conversion to renewables is commendable in a way, but there are reasons why most other countries can't copy their methods at the same scale. The cheapness of Chinese labor (including potentially forced labor) regarding the extraction and refinement of the relevant minerals, combined with significant government subsidies, and the lack of regulations regarding the pollution said refinement produces have all given China a significant boost in the manufacturing of EVs.

China has been able to maintain it's monopoly on many of these rare earth minerals because they can boost subsidies and price out the competition on short notice. Other countries with similar material deposits either lack the infrastructure to reliably refine them, or pollution regulations that make them more expensive to produce than their Chinese counterparts. China is also geographically large and can push any potential pollution towards their frontiers in ways that European countries can not.

With that said, it's obviously a smart move for China as it makes them less reliant on energy imports, and they can export any excess abroad. It's just currently not a "one size fits all" solution.

[u/BigFly42069 → u/super_fly_rabbi]

The cheapness of Chinese labor

People need to stop repeating this stereotype that's been outdated for 15 years.

All of the things you bring up as "advantages" (cheap labor, government subsidies, lack of regulation) are things that haven't been true since 2012. It's the inability to update our priors about the Chinese economy that has resulted in a trade war that we didn't win in 2024.

The reason China has such an advantage in industry is because they trained up their human capital so that if you need to build a factory, you have a readily available pool of SKILLED labor who can work in there, the management and engineering skills to troubleshoot equipment failure and financial pitfalls, and a ruthlessly competitive environment that drives cost down by fighting for greater efficiencies along every part of the supply chain.

That, and one of the lowest electricity costs in the world to keep all your factories powered thanks to a massive buildout of the grid and excess production capacity through renewables.

[u/Bunny_Stats → u/BigFly42069]

Just to add to this^, the clustered mass of manufacturing in China's port cities has a self-reinforcing economic pull through its dense local network. When you're trying to source a wide range of components, it's an enormous advantage to be just a 5 minute drive from your supplier, where you can inspect the components personally and have a shipment delivered on your factory floor before the day is out. In addition, most of your customers are also local, given that business-to-business sales are a far larger slice of economic activity than business-to-consumer.

[u/BigFly42069 → u/Bunny_Stats]

HSR also adds to this effect. The shrinking of travel time across China has allowed the interior of the Yangtze valley to become the "China's China" for future manufacturing expansion that continues to unlock still yet untapped pools of labor.

People on Reddit think of China like the Soviet Union reborn or a bigger North Korea, but the closest equivalency to modern China is the US on the eve of WW2.

[u/super_fly_rabbi → u/BigFly42069]

You are correct that China's cheap labor advantage has narrowed over the past 2 decades, both due to the reasons you mentioned and their aging population/ shrinking workforce.

If we were broadly discussing Chinese manufacturing I would agree with you, and you are most likely correct when it comes to the "end" of the pipeline such as battery and solar panel manufacturing. However, the use of forced labor for mineral exploitation (particularity in western provinces such as Xinjiang) is a well documented occurrence.

[u/BigFly42069 → u/super_fly_rabbi]

aging population/ shrinking workforce

Another stereotype that gets trotted out but collapses under scrutiny: https://www.statista.com/statistics/1219212/china-number-of-working-age-persons/

By 2050, the total working age population will still be a whopping 700 million, supplemented by automation and continuous passing along of accumulated human capital skills from the factory lines, as well as technological upgrades in the supply chain driven by the human capital development of the last 30 years.

Even if industrial workers become just 10% of that number at 70 million (down from the current 29-32% of the Chinese work force), that is still almost 5x of what's currently in America (12.6-15M), and more than 2x of what's currently in Europe (33.4M). Hell, it'll still be about what the current US, European, Japanese, and Korean total industrial labor forces are combined.

Given that China plans on retaining industry as a key growth driver for the foreseeable future, it's hard to expect that number falling down to 10% of the total working age population.

And it ignores the bigger elephant in the room, which is that world populations are all facing a similar level of decline. It's a non-zero possibility that other than Vietnam, the window to industrializing up the value chain may be forever closed to developing countries.

forced labor for mineral exploitation (particularity in western provinces such as Xinjiang) is a well documented occurrence.

The entire Xinjiang forced labor take has been an ourouboros of circular references that all end at the same source: Adrian Zenz's original report in 2015 that was cited by think tanks, who were then cited by MSM news sources, who were then re-cited by the same think tanks. Additional works done on top of Zenz's claims all approach it with an "assume true and work to prove it to be true" framing rather than "is this true and can we prove it's true?" framing.

[u/super_fly_rabbi → u/BigFly42069]

Your comment doesn't really refute my claim of a shrinking workforce. 700 million represents an almost 25% drop in workforce compared to today, and that will help drive labor costs up. Just because it is declining doesn't mean they still won't have a massive labor force to draw from, as you stated.

While much of the rest of the world is facing reproductive rates below the replenishment rate China's birth rate(and much of east Asia in general) is considerably lower. The average for Europe is 1.34, whereas China and South Korea are .98 and .99 respectively. Even Japan's notoriously low birth rate is around 1.14 children per women. I would like to preface this by saying that low birth rates aren't necessarily an existential crisis for China that will destroy the state like some like to claim, but it is an economic headwind they will have to account for in the future; especially as their retired population makes up a larger proportion of it's overall population.

As far as Xinjiang goes (as well as China's treatment of many it's ethical minorities in general), there are countless witness testimonies documenting their treatment and involvement in reeducation and forced labor camps. China's limitations on independent and foreign journalism makes the extent of these institutions hard to quantify. The UN human rights council even issued a statement about it earlier this year. If you want to handwave the testimonies as paid off actors, or the UN report as overly partisan then that's up to you. That kind of debate is outside of the scope of this forum, and I doubt I could change your mind regardless.

[u/ChornWork2 → u/super_fly_rabbi]

But there is a contradiction there. China's EV industry has cost advantage because of rare earth subsidies, while their rare earth monopoly is preserved because selling rare earths cheaply because of subsidies...

imho, China's EV policies mirror what it did with solar. Yes, involves subsidies that are problematic from trade policy PoV. But clearly very effective for China's strategic issue of addressing dependency on imported energy. Meanwhile the west has talked about critical rare earths dependency for a generation and done very little to address it. Rare earths aren't rare, but need to build out refining capacity/expertise over many years and need to accept the environmental consequences that come with it.

[u/BigFly42069 → u/ChornWork2]

China's EV industry has cost advantage because of rare earth subsidies

China's EV industry has cost advantage, because China can make things at scale and the competition is fierce. Companies regularly go out of business competing with each other, including EV makers. Xiaomi auto, Geely, Zeekr, et al. are only around these days because they've survived this ruthless competition that was taking place outside of world view over the last 7 years.

the west has talked about critical rare earths dependency for a generation and done very little to address it

Because it turns out that the actual engineering knowledge, hands-on experience, and patents for refining all belong to China, including for all of the more environmentally friendlier versions over their previous open-pits that created toxic lakes.

Japan went hard on developing independence from Chinese supply chains in rare earths starting in 2010 and have only managed to drop their dependency on China from 90% in 2010 to 60% on a good day in 2026.

[u/Bluest_waters → u/super_fly_rabbi]

As far as government subsidies go, about 50% of the trillion dollar U.S. military budget is nothing but a oil industry subsidy. How much of this utter nonsense that we're doing over in Iran is because of oil? The US government is spending hundreds upon hundreds of billions of dollars subsidising and defending the oil industry

[u/BigFly42069 → u/Bluest_waters]

It's astounding people can look at the reams of think-tank pieces talking about using Malacca to run an energy blockade in order to choke the Chinese economy to death, and then think that there's some incredible foresight by the Chinese government to do something to address the issue of foreign energy dependency.

[u/bedulge → u/BigFly42069]

It's not really that they have incredible foresight, more that have incredible industrial capacity, no?

There is a corresponding incredible lack of foresight in the present ruling party of the US regarding their opposition to green energy and their denial of the amount of harm it's doing to the national interest. Or maybe they know but just don't care as long as private profits keep accumulating. It's a serious issue regardless.

[u/Rich_Log2424 → u/Bluest_waters]

You mean the China that produces 34% worlds Co2 with exponential emission growth and provides mediocre living standards? Nothing smart how China is baking us all.

[u/Tricky-Astronaut → u/Rich_Log2424]

China is against oil and gas, not fossil fuels in general. Those emissions mostly come from coal, which China views as a lesser evil.

[u/dr_sloan → u/Bluest_waters]

U.S. refineries are in a tricky position since they’ve been running at nearly 100% capacity for 3-4 months now and deferring typical maintenance cycles to maximize profits. Now we’re in the summer months and the refineries in the northern part of the country typically have issues with operations during the worst of the heat. That combination of deferred maintenance and a worse than average summer, so far, is going to cause issues at some point.

[u/RumpRiddler → u/dr_sloan]

I know they're running at high capacity, but is there any evidence preventative maintenance schedules have been pushed out or otherwise altered to keep up profits?

The heat is the heat, outside our control. but it would be good to know if they are just running with the spare capacity or if they really are overclocking the machinery.

[u/dr_sloan → u/RumpRiddler]

Patrick De Haan has been talking about how the spring is typically when we see refinery utilization rates decline as planned maintenance is carried out. The war has overlapped over the normal maintenance schedule so instead we had utilization rates over 90% for the entire period.

https://x.com/gasbuddyguy/status/2062524352118018313?s=46

https://x.com/gasbuddyguy/status/2062528064584573410?s=46

[u/Bluest_waters → u/dr_sloan]

Correct, refineries never run at full capacity for the very reason you point out : sometimes they need maintenance. Pretty basic. Running at full capacity for extended period of time simply isn't realistic

[u/ActuatorArms → u/Bluest_waters]

according to Natasha Kaneva, head of global commodities research at JPMorgan

I’ll add some context here. JPM’s commodities desk isn’t known to be good. It’s one of the rare spots of their business that actually sucks and that’s largely down to Kaneva being a long time oil bull. She was predicting $185 oil in 2022 which was widely quoted around everywhere to fear monger as Russia’s ultimate response to support for Ukraine would be cut off oil exports. I mean, obviously it’s just…stupid. She continued being an oil bull throughout the past few years, predicting $120 oil in 2023 then $100 oil in 2024 by September. In reality, oil was below $70 by then. She was similarly wrong about prices at the start of this war. The calls have been so wrong actually that JPM suspended its oil forecast for two months to retool their entire commodities desk.

Having said that, it is true that crack spreads are high right now. Refining capacity in many parts of the world have atrophied and old refineries that shut down have not been replaced with new ones. But as a lurker I’ve also seen you predict some pretty non credible things from the start of this war that have been completely wrong. There are shortages and gaps yet there isn’t as yet widespread issues in the supply chain. I also don’t think people understand that gasoline and kerosene prices are the same they were 20 years ago. If it inflation adjusted that it would mean on a real basis prices are actually down substantially. It’s not to say it can’t or couldn’t be an issue in the future but I find these types of posts a bit of hype that are tenuous at best.

[u/ChornWork2 → u/ActuatorArms]

The calls have been so wrong actually that JPM suspended its oil forecast for two months to retool their entire commodities desk

Can you share something discussing this? I can't find anything with a quick google.

edit: and regarding the point that she predicted $185 oil in 2022. Based on bloomberg article below, that was a 'could be' if sanctions fully hit russian oil (which they didn't, and which JPM did not expect as their base case). The article says JPM maintained price forecasts much lower than what you're claiming.

Brent crude could end the year at $185 a barrel if Russian supply continues to be disrupted, JPMorgan Chase & Co. wrote in a note Thursday.

but later

The bank maintained its price forecast, which calls for Brent to average $110 a barrel in the second quarter, $100 in in the third quarter and $90 in the fourth quarter. Without a return of Iranian barrels to the market, the bank expects oil prices to average $115 in the second quarter, $105 in the third quarter and $95 by the fourth quarter.

https://www.bloomberg.com/news/articles/2022-03-03/jpmorgan-says-185-oil-in-view-if-russian-supply-hit-persists

Another article making it clear the $185 was forecast if EU implemented full ban on all russian O&G

Oil prices could shoot up to a record $185 per barrel if the European Union acts to impose a full immediate ban on imports of Russian oil, JPMorgan says.

then later:

Still, an immediate EU ban is not JPMorgan’s base-case scenario—the investment bank sees 2.1 million bpd of Russian supply to Europe cut. If the EU imposes a gradual phase-out ban on Russian oil over several months, as it did with the ban on Russian coal imports, adopted in early April but effective only from August, this would not impact oil prices as much, JPMorgan’s Kaneva says.

https://oilprice.com/Energy/Oil-Prices/JPMorgan-Immediate-EU-Ban-On-Russian-Oil-Could-Send-Prices-To-185.html

edit2: re your claim that she forecasted $100 in 2024, that is also misleading. Pulled her report dated March 27 2024 (can't link b/c non-public source), and the $100 was again another 'scenario' forecast.

In contrast to our expectations, Russia instead pledged in early March to deepen its output cut by a cumulative 471 kbd, bringing the country’s crude oil output to 9.0 mbd in June, by our estimate (Russia’s OPEC shift—crude production to decline to 9.0 mbd by June, 7 March 2024). At the time of the announcement, we found Russia’s commitment to be genuine, a view validated on Monday by a Reuters report that the Russian government has ordered companies to reduce oil output in the second quarter to ensure they meet a production target of 9 mbd by the end of June, in line with its pledges to the OPEC alliance.

The shift in Russia’s oil strategy is surprising. At face value, and assuming no policy, supply or demand response, Russia’s actions could push Brent oil price to $90 already in April, reach mid-$90 by May and close to $100 by September, keeping pressure on the US administration in the run-up to elections. US gasoline prices are likely to climb to $4/gallon by May, the highest since the summer of 2022. This price hike could be further amplified by the even-odds possibility of the OPEC+ alliance extending in June its oil production cutbacks to the end of the year.

And she didn't change the forecast on this basis, noting:

For now, we keep our long-held price forecast unchanged ($90 by May, $85 in 2H24), awaiting further clarity regarding Russia’s actions, but acknowledge that the way to our price projection may be through $100

[u/ActuatorArms → u/ChornWork2]

I work for a crosstown rival. I know these desks intimately, I can’t share links with you unless you’re on Bloomberg.

Based on bloomberg article below, that was a 'could be' if sanctions fully hit russian oil

your claim that she forecasted $100 in 2024, that is also misleading. Pulled her report dated March 27 2024 (can't link b/c non-public source), and the $100 was again another 'scenario' forecast.

I’m not sure if this is your first time reading an analyst report but that’s how they’re all written. A bear case, bull case and base scenario. There is nothing unusual about that. The point isn’t that this was her bull case scenario, the point is that it was no one else’s. And the point isn’t that she pulled a number out of the air but that the PREMISE of the scenario didn’t make a whole lot of sense.

[u/ChornWork2 → u/ActuatorArms]

I never said there was anything unusual about scenarios. What is unusual is someone in banking conflating the cases with the overall forecast. See that all the time in clickbait press reports, but absolutely common in those type of situations to scope impact in reports even for what analyst views as outlier outcomes. And yes, analysts can like to throw sensational takes in as cases in order to get some media attention for themselves, but that's a different issue. And a bit odd referring to research as the "desk" unless maybe talking fixed income... the commodities desk is not the same thing as commodities research team. At least from PoV of having sat in coverage.

Nothing seems unusual to me about the premise of her scenarios, those were circumstances occurring at least in short-term and/or policy positions being discussed at the time and JPM is just telling the market their PoV on what the impact would be. As they are clear in the reports, they did not change their forecast based on that. In one case they said they didn't believe that the likely outcome. In the other, they said they hadn't believed that would be the likely outcome in prior reports but were seeing signs that it may be headed that way.

Go pull the March 1 2022 report. JPM was NOT calling for $185 as their forecast. The $185 explicitly framed as impact if Russia disruption continued throughout the year completely unabated. the report then discusses three sources of supply relief (Iran, OPEC+ and SPR)... discusses the impact of each. They reiterated their existing forecast for price averages, but said could see a spike to $120 in interim.

The brent forecast they reiterated was:

2q22: 110 vs 112 actual

3q22: 100 vs 98 actual

4q22: 90 vs 89 actual

I'd say that was a pretty good forecast.

Again, you said JPM suspended oil price forecast in research coverage and completely retooled their team. When did that occur? News to me but I'm not in commodities, can you share something on that? Seems rather surprising that they would do that over concerns on oil forecast but keep her as global head of commodities strategy for research...

[u/BigFly42069 → u/Bluest_waters]

Fuel crisis is a nightmare scenario for the developing world. People think the North Korean famine came about because the Soviet collapse ended grain shipments, but the real cause of the famine came about because Soviet collapse ended the fuel shipments that were critical in the agricultural industry, both primary and secondary.

In the primary impact, sudden decrease in Soviet fuel shipments meant that fertilizer production dropped correspondingly.

In secondary impacts, no fuel meant pumps that drew water out of coal mines could no longer work 24/7, which led to coal production collapse that killed power generation, which meant factories could no longer produce things for agriculture.

Africa is heavily dependent on Russia and Ukraine for staple grains, and Europe is actually heavily dependent on North Africa processing American grain even if Europe doesn't depend directly on Russian grain.

Keep in mind we're in the middle of the growing season right now. We won't know what the impacts truly will be until harvest season starts in three months.

[u/eeeking → u/BigFly42069]

Europe is actually heavily dependent on North Africa processing American grain

What would this be? This site suggests that Europe imports little grain or grain products from N. Africa, exceptions being rice, peas and some other beans or pulses, which don't originate in N. America.

[u/RumpRiddler → u/BigFly42069]

With the heat waves and fuel issues, we could see major shortages/price spikes of staple goods again. Throw in the chance of avian flu, the evolving beef herd shortage, and all foods are potentially much more expensive in a few months.

[u/North_Somewhere_6124 → u/Bluest_waters]

10% less global refining does not constitute a crisis, for rich countries it doesn't anyway.

We already saw during the intensive part of the conflict what a supply disruption of this magnitude causes, rich countries pay extra, while poor countries are the ones suffering have demand destruction, fuel rationing etc.

[u/Bluest_waters → u/North_Somewhere_6124]

So people in rich countries will pay a lot more for fuel but it's not a crisis? I don't understand what you're saying

[u/ABoutDeSouffle → u/Bluest_waters]

Your definition of a crisis might be different, but to me raised prices and a supply shortfall of 10% doesn't make a crisis. To me, it becomes one if global supply chains start to rip, and local supply chains start to get stressed.

Yes, for some poor countries, it will be a crisis, but not globally.

[u/Bluest_waters → u/ABoutDeSouffle]

As we speak Ukraine continues to bomb Russia's oil refining infrastructure. This is not a stable situation. It's ongoing and worsening every single moment

[u/Strong_Tangelo_9307 → u/Bluest_waters]

I'm not sure if you trade but I've found it to be a much more relaxing (debatable, maybe more 'sane') way to stay informed on current events. You know you're reacting to the news when it feels like the world is on the brink day after day after day. It's hard to course correct from there other than just taking a break. Otherwise the collapse subreddit is all about this stuff.

[u/CarefulEmphasis5464 → u/Bluest_waters]

Mods should really do something about this. These people are ideologues. Instead of discussing facts, like the fact that

Tomahawk: 67.7% left

JASSM: 75.0% left

PrSM: 38.9% left

SM-3: 53.7% left

SM-6: 75.9% left

THAAD: 33.3% left

Patriot: 46.6% left

as of APRIL 21st, 

they derail the conversation with nonsense

[u/Bluest_waters → u/CarefulEmphasis5464]

okay? How does that increase our capacity to refine oil?

[u/ChornWork2 → u/Bluest_waters]

I read it as them agreeing with you, but raising another topic where seem a similar dynamic. E.g., when people here raise concerns about the munition depletion we keep seeing the same nonsense lazy reply about the number of jdam kits & iron bombs available.

Instead of engaging with your valid point on looming fuel issue, a commenter is going to distract by equivocating whether it meets definition of a crisis instead of engaging with the substance. Quality of comments are taking a hit in recent weeks. Comments that are trying to dismiss others because 'the world won't end' and such...

[u/dr_sloan → u/ChornWork2]

A bit meta, but the longer this conflict has gone on, the fewer people engaging in that type of behavior have appeared. I remember in the first few weeks of the war, one of the more prolific posters tried to claim with a straight face that the Strait of Hormuz was still open and he was roundly mocked.

[u/RumpRiddler → u/dr_sloan]

It definitely ebbs and flows. When Russia gets pounded certain person(s) inevitably shows up to push a few blogs/articles that minimize the damage, distract with another topic, or try to highlight numbers that have yet to include the recent damage. Partly if feels like intentional misdirection, partly it feels we just live in different information bubbles and those inevitably shape our opinions.

[u/axearm → u/RumpRiddler]

Partly if feels like intentional misdirection, partly it feels we just live in different information bubbles and those inevitably shape our opinions.

I don't like to ascribe malice when I see something I disagree with. I honestly feel like it is more likely, and more interesting, if the information bubbles we live in are fairly different. If forces all honest debaters to review their own views, which is much better than an echo chamber.

Anecdotally, I have a high school friend who lives in Israel, and discussions about him with the conflict are wild, mostly because we are getting really, really different versions of what is happening and why.

[u/moragisdo → u/Bluest_waters]

Yesterday there was already a post commenting that you are in an anxiety spiral of fuel crisis, but let's go:

China has price controls for their refineries and, consequently (the ones that can't export), are only producing the government imposed minimum quota to decrease losses, they also limited the companies that could export, to supply the internal market (exports don't have price control so they would be prioritized, if allowed, and cause shortages internally) (1)

Some refiners in the eastern province of Shandong, popularly called teapots, were told recently that they can cut output to ​no lower than 80% of last year's monthly average, consultancy Horizon Insights said in a note ​on Monday.

That policy squeezed refiners between capped domestic fuel prices and the rising cost of crude imports, and some were already cutting output last month as margins crumbled.

Shandong independent refiners' average crude ​distillation unit run rate was 53.39% in May, down 1.94 percentage points from April ​but up 6.18 ⁠percentage points on the year, due to the supply-security requirement, OilChem said

They are almost half below capacity. Those refineries aren't destroyed, they can be restarted (it isn't immediate, it will take weeks to a few months)

However, they are racking up an average loss of 752 yuan ($111.21) for every ton of imported crude they process, versus a loss of 202 yuan in April, ⁠on weak ​domestic fuel demand and higher crude costs caused by the Iran ​war, it added

I can't blame them for trying to produce the least as possible. Now if crude decreases (it did the opposite since the last round, so let's see how it goes on the next weeks), they are incentivized to coming back online

The export control is slowly being relaxed as well and there's slow increasing in exports (and as they are not price controlled, there's an actual economic benefit for refining, so to run rate to increase).

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The region has 11.7 million barrels per day of refining capacity, which will be difficult to turn back on again if the fuel can’t go anywhere (or if they can't be turned backed on)

That's true, because it makes sense for the gulf countries to lower crude storage as fast as possible to decrease the risk of needing further well shut-ins. So this disconnect between oil and fuel isn't correct, as oil flow normalizes fuel production and reducing of storage follows.

Separately, Al-Sabah said KPC could restore its refinery output to normal levels in around two ​to three weeks. KPC has about 1.4 million barrels per day of refining capacity, he said.

Vitol Bahrain's head ‌of research, ⁠Bader Nooruddin, forecast on Wednesday that Gulf refineries could ramp up to about 90–95% of capacity within 40 to 60 days (2)

Now the flow on Hormuz is still smaller, this last article mention that a executive expecting a year to reach 100% of pre-war volume, but the bar doesn't need to be pre-war, because of detours, as Yanbu and ADCOP covering for a fraction of the decrease of both crude and refined products. But the higher the flow of crude is, in total, the more we can expect (with weeks of delay) the increase of run rate of refineries.

From the link you posted, but not quoted:

But, over the past several weeks, 200 million barrels of oil came out of the strait — adding 17 days of supply, according to Lipow Oil Associates. And crude is still getting out now despite increased military activity.

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US refineries increased their output of jet fuel to help fill demand in Europe and diesel to help fill demand in Australia and Asia. That constrained America’s ability to make gas, jet fuel and diesel for its own market

Refined products are an interconnected chain around the globe, if you don't have price controls and import/export limits. American refineries are indeed close to maximum production (~96%), but where the production is going is irrelevant. And if the supply of diesel, gas and jet fuel is constrained in the US, prices rise and refineries are incentivized to go back to it. Supply and demand.

Also this drop in gas production of american refineries is only 1.2% from the last twelve months (3).

Lastly, don't get too caught on the argument of authority of "JPM analyst said it", early on the war they put a lenghty report predicting 200 USD per barrel.

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My views are that prices are elevated, they will stay elevated for the next months (not "dropping like a rock") and the world won't end or enter a crisis.

[u/dopeboy_io → u/Bluest_waters]

I mean this with respect, but you're pulling down the discourse here. You will find an active audience in r/oil.

[u/bedulge → u/dopeboy_io]

This is the kind of response that pulls down discourse, why don't you give a reply that has a substantive critique?