This Winter, We Could Potentially Be Facing Simultaneous Shortages Of Oil, Natural Gas, Propane And Coal
Francesco Abbruzzino, The Uncensored Report, LLC
I realize that the headline that I have chosen for this article may sound a bit wild to many of you, but keep reading because what we are potentially facing is extremely serious. Right now, we are already in the midst of an epic global energy crisis. There have already been significant power outages all over the planet, and prices are spiking at a pace that is absolutely breathtaking. With each passing day, it seems like supplies of oil, natural gas, propane and coal just keep getting tighter, and what is really odd is that it is happening so early in the year. Summer just ended a few weeks ago, and the heart of winter in the northern hemisphere is still several months away. So if things are this bad already, what are things going to look like when we get into January and February?
This morning, I was stunned when I pulled up the Drudge Report and saw that one gas station in California was now selling gasoline for $7.59 a gallon…
Gas keeps getting more and more expensive, especially in California. But perhaps nowhere is it pricier than the remote central coast community of Gorda.
The town’s only gas station is offering regular unleaded for $7.59. Premium is nearly $8.50.
The good news is that a gallon of gasoline is not nearly that high in most of the rest of the nation.
But the bad news is that prices are rising aggressively from coast to coast. As of yesterday, Fox News was reporting that the price of gasoline had risen “for 22 straight days”.
The main reason why prices are skyrocketing is because supplies are starting to get really tight. In fact, it is being reported that the crude oil hub in Cushing, Oklahoma could be “effectively out of crude” in just a few weeks…
In a note predicting the near-term dynamics of the oil market, JPMorgan’s commodity Natasha Kaneva writes that in a world of pervasive nat gas and coal shortages which are forcing the power sector to increasingly turn to oil (boosting demand by 750bkd during winter and drawing inventory by 2.1mmb/d in Nov and Dec), Cushing oil storage – which just dropped to 31.2mm barrels, the lowest since 2018…
… may be just weeks from being “effectively out of crude.” The bank’s conclusion: “if nothing were to change in the Cushing balance over the next two months, we might expect front WTI spreads to spike to record highs—a “super backwardation” scenario.”
Needless to say, we have never seen anything like this happen before.
In such a scenario, how high could the price of oil potentially go?
And if oil price records are being shattered in the months ahead, what will ordinary Americans have to pay when they go to fill up their vehicles?
I have a feeling that we are about to enter uncharted territory.
Meanwhile, one expert recently told Bloomberg that we could soon be facing “propane-market armageddon”…