Here is what I think is going on.
The US is talking to Pakistan. Pakistan is talking to the guys it wants to be in charge of Iran. Right now, in Iran there are two types of people. Those who are worried about their lives and those who think this is a great opportunity to take over power. Both, groups are hiding in caves but for different reasons. So if you think you could be the first President of Iran you are acting like it and negotiating. This is very much a Don Quixote-like situation.
The guys actually in charge of Iran are in Russia (or a cave but likely in Russia) and they aren’t talking to anyone but Putin. Putin wants two things. He wants Europe, India and China to need Russia’s oil AND he needs Ukraine to stop blowing shit up. So far he is one for two.
Iran's royal guard are operating as little headless cells and their job is to just press the “blow shit up button” and they aren’t regular Twitter users so they don’t know there are supposed negotiations requiring them to stop blowing shit up.
Axios “source” is Baron Trump’s girlfriend because every time he makes a great trade she gets a new purse. Axios’ editors must be making a killing day-trading right now.
Assuming I am partially right, the Administration isn’t talking to the right people, is blowing up stuff that the world will need (plastics, petrochemicals, etc) pissing off everyone. And various news outlets are just putting out anything as long as it came from a guy in a taqiyah or someone sucking the cock of someone in the White House.
And… there are probably no mines in the Strait of Hormuz.
I still find it strange that there hasn’t been one attack in the Bab al-Mandab Strait. That would definitely spike the oil market and buy a few nice camels.
We live in a world where everyone has so much money there isn’t much conviction. Except, in central Asia and Africa. And no one seems to care about those people.
PCE is Thursday. Since the stock market is being kept up almost super naturally I am not sure a hot print will do much. Even though it should. Remember, Wall Street knew the subprime was going to implode for almost a year. Watch the swaps market.
Anecdotally, I know a dozen or so restaurant owners here in Atlanta and they have all raised priced in the last few weeks in some cases by 25%/menu item. Even without this spike in oil the US is likely stagflationary.
Still just carrying hedges. Unfortunately, I haven’t been able to roll them this week because I haven’t been able to crawl out of bed this week due to a head cold.
Maybe tomorrow.
Remember, the market turns when the smartest idiot changes his mind. Not before.
As always, if you think there are spelling errors update your dictionary to the latest version. Happy speculation!
— AJ
Event Horizon Tools
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