If the Hamas-Israel war does spill over to the wider region—causing a ‘large supply disruption’ scenario, prices could spike to as high as $157 per barrel, the World Bank said on Monday. This quarter, oil prices are expected to average $90 per barrel – not too different from the price of oil early on Monday at just below $90, according to the World Bank’s latest Commodity Markets Outlook published today. So far, the conflict between Hamas and Israel has had limited impact on the global commodity markets, with oil prices having risen by around 6% since the Hamas attack on Israel. The bank has assessed three possible risk scenarios of oil supply disruptions based on historical experience since the 1970s.
In a “small disruption” scenario where global oil supply would be reduced by up to 2 million barrels per day, oil prices would initially increase between 3% and 13% relative to the average for the current quarter—to a range of $93 to $102 a barrel.
A “medium disruption” scenario—roughly equivalent to the Iraq war in 2003—would take up to 5 million bpd off global oil supply and send oil prices jumping by 21% to 35% initially—to between $109 and $121 a barrel, according to the World Bank.
In a “large disruption” scenario—comparable to the Arab oil embargo in 1973—global oil supply would shrink by up to 8 million bpd and push prices surging by 56% to 75% initially—to between $140 and $157 a barrel, the bank added.
“If the conflict were to escalate, the global economy would face a dual energy shock for the first time in decades—not just from the war in Ukraine but also from the Middle East,” Indermit Gill, the World Bank’s Chief Economist and Senior Vice President for Development Economics said in a statement. NN: We are literary staring into the Abys . And the Abyss is staring back.
World Health Organization (WHO) Director-General Tedros Adhanom Ghebreyesus said on Saturday that the agency is still unable to reach its staff and health facilities in the Gaza Strip after what appears to be a total disruption of communication and internet services in the Palestinian territory. “Reports of intense bombardment in Gaza are extremely distressing. Evacuation of patients is not possible under such circumstances, nor to find safe shelter. The blackout is also making it impossible for ambulances to reach the injured,” the WHO chief wrote on X, formerly known as Twitter. Previously, the Palestinian telecom provider Paltel said that the “continuous intensive bombardment” of the enclave caused complete disruption of internet, cellular, and landline services in the Gaza Strip. “Gaza is currently blacked out,” the provider announced via its X profile. NN: They want you to believe innocent Hamas murders are victims of Israeli aggression. Please note they are still able to launch their bottle rockets. And its reported UN and the WHO officials cannot contact their people….. Really? I can tell you they have enrolled over 1000 Immersat2 Satellite phones that are operating. The story goes the hospitals are unable to contact first responses. And as far as “first responders” unable to communicate bull. All Red Crescent ambulances are supplied with 2 way radios many with telemetry data which are working. They operate on the same frequencies as in Israel because red crescent ambulances are often allowed into Israel on humanitarian life saving cases. AS far as internet and cell phones. Providers Paltell as and Jawwal are down. But most Palestinians carry Israel cell phone sim card which have some coverage in Gaza, They forgot to tell internet service is fully operational in Gaza on the Starlink system. Which is in wide proliferation since the Palestinian ISP’s were always slow and unreliable. Elon Musk is providing starlink equipment and service for free to all public users including the UN and hospitals.
The US has carried out an air strike targeting Iran-backed militias in Syria, in the first military action undertaken by the Biden administration.
The Pentagon said the strike destroyed “multiple facilities” and was ordered in response to attacks against US and coalition personnel in Iraq. Militia officials said one person had been killed but a war monitor reported at least 22 fatalities. Syria condemned the attack as a “bad sign” from the new US administration. The Pentagon said its strike near the Iraqi border in eastern Syria was a “proportionate military response” that was taken “together with diplomatic measures”, including consulting coalition partners. It came after a civilian contractor was killed in a rocket attack on US targets earlier this month. A US service member and five other contractors were also injured when the rockets hit sites in Irbil, including a base used by the US-led coalition. The Pentagon said the strike on Friday was launched “at President Biden’s direction”. It targeted facilities located at a border control point used by a number of Iran-backed militia groups, including Kataib Hezbollah and Kataib Sayyid al-Shuhada, who are allied with the Damascus government. Kataib Hezbollah and Kataib Sayyid al-Shuhada have previously carried out or supported rocket attacks targeting US assets in the country. The US has launched retaliatory strikes. But Kataib Hezbollah has denied involvement in recent attacks against US interests. In its statement, the Pentagon said its latest operation “sends an unambiguous message”.”President Biden will act to protect American and Coalition personnel. At the same time, we have acted in a deliberate manner that aims to de-escalate the overall situation in both eastern Syria and Iraq,” it said. The US did not confirm any casualties, but an Iraqi militia official told the Associated Press news agency at least one fighter was killed and a number of others wounded.The official said the strikes hit an area along the border between the Syrian city of Boukamal and the Iraqi town of Qaim. The Syrian Observatory for Human Rights, a UK-based monitoring group, said the US attack had killed at least 22 fighters from the Popular Mobilisation Forces, an Iraqi umbrella group of mostly Shia paramilitaries that includes Kataib Hezbollah. “The strikes destroyed three lorries carrying munitions,” the observatory’s Rami Abdul Rahman earlier told AFP. “There were many casualties.” Several attacks targeting US personnel have been claimed by little-known groups. But some Iraqi and Western officials say these are a front for established militias, so they can carry out attacks without being held accountable. NN: Iran’s pecker marks are all over this. Plausible deniability is no longer plausible. My bet is things will escalate and oil supply lines will be in the fray. Especially in the Straights.
The US military has attacked Iranian proxy forces in Syria, US Secretary of Defense Lloyd J. Austin confirmed in a statement late on Thursday. According to the release, the airstrikes were carried out against two facilities used by Iran’s Islamic Revolutionary Guard Corps (IRGC) and affiliated groups and came as a retaliation for attacks on bases hosting US troops in Iraq and Syria since October 17. The “precision self-defense strikes” were directed by President Joe Biden and “were intended solely to protect and defend US personnel in Iraq and Syria.” “The United States does not seek conflict and has no intention nor desire to engage in further hostilities, but these Iranian-backed attacks against US forces are unacceptable and must stop,” noted the statement. NN: This conflict is escalating. We need to be laser focused because one day very soon you will wake up to a raging war. With strikes against oil infrastructure.
The current war between Israel and the Palestinian political and militant group Hamas originated in the murder of over 1,400 of the former’s civilians by the latter on and around 7 October, it has quickly begun to revert into the long-running conflict over the statehood of Israel and Palestine. This brings with it the potential to draw into the war several other Arab states in the region who support Palestine’s right for a fully independent state. It also means that Iran – a Persian, not an Arabic, state, but one which does is committed to erasing the state of Israel – has everything to gain by instigating a widening out of the present war between Israel and Hama the Islamic Republic of Iran, which came into existence in 1979. With the removal of Israel as a state being one of its core objectives, alongside the destruction of all U.S. influence in the Middle East, several highly-placed security sources in both the U.S. and the European Union (E.U.), exclusively spoke to by OilPrice.com last week, do not believe that Hamas would have acted against Israel on 7 October without – at minimum – assurances from Iran that its actions were not opposed in Tehran. “Israel is regarded as an abhorrence by Iran – not just because of its existence as a state, but also because it is seen as the primary tool by which the U.S. seeks to extend its influence across the Islamic world of the Middle East, so [Iran] it has everything to gain by manipulating this war [between Israel and Hamas] into something much bigger,” a senior source in the E.U.’s security complex told
Although there is a flurry of diplomatic activity taking place to avert the Israel-Hamas War widening out, on 16 October Iran’s Foreign Minister, Hossein Amir Abdollahian, warned that its regional network of militias would open “multiple fronts” against Israel if its attacks continued to kill civilians in Gaza. It seems highly likely that the first new front would be a full activation of Hezbollah in Lebanon, to Israel’s direct north; a 100,000-strong very well-equipped fighting force funded and trained by Iran’s Islamic Revolutionary Guards Corps (IRGC) that dwarfs the fighting capabilities of Hamas in all respects. Israel has already stated that its mission is to “annihilate Hamas” and that to do so it will launch ground operations into Palestine for as long as it takes to do so. Additionally, over the weekend, Israel’s Minister of Economy, Nir Barkat, said that if Hezbollah fully joins the war then Israel would “cut off the head of the snake” and launch a military attack against Iran. A third front could also be opened by Iran, using its own IRGC and proxy militant forces stationed in Syria, to Israel’s northeast.
The potential for oil and gas prices to spike is considerable if the conflict does indeed widen out. Reductions in supply from any of the major OPEC suppliers – let alone all of them at once, as might be the case – would be extremely difficult to compensate for, although there are plans in place by the West to attempt to do so. Emergency gas supplies from Qatar appear likely to continue under most circumstances, which would alleviate some short-term price pain in the West, as they did after Russia invaded Ukraine in 2022. Plans are also in place to extend the easing of sanctions on Venezuela seen on 18 October, according to the E.U. source, with the country’s crude production averaging around 770,000 bpd in September. Additionally, the International Energy Agency (IEA) said on 12 October that it is “ready to act” if the Israel-Hamas War escalated to hit oil supplies in the region. As has been seen before in times of dramatic oil price rises, the agency can coordinate the release of emergency oil stocks with each IEA member country. Each is obliged to hold oil stocks equivalent to at least 90 days of net oil imports and to be ready to respond to severe supply disruptions affecting the global oil market. This said, OPEC+ controls
Americans are falling behind on their auto loans at the highest rate in nearly three decades. With interest rate hikes making newer loans more expensive, millions of car owners are struggling to afford their payments. It’s a clear indication of distress at a time when the economy is sending mixed signals, particularly about the health of consumer spending.
The percent of subprime auto borrowers at least 60 days past due on their loans rose to 6.11% in September, the highest in data going back to 1994, according to Fitch Ratings.
In April that figure slipped from a previous high of 5.93% in January. But after burning through tax returns, contending with a shakier job market and grappling with still-elevated inflation, more car owners have become delinquent. Behind the surge is both higher car prices and borrowing costs. And with the Federal Reserve indicating it plans to keep rates higher for longer, the problem is likely to persist, especially as millions of Americans recently started paying their federal student loans again. “The subprime borrower is getting squeezed,” said Margaret Rowe, senior director with the asset-backed securities group at Fitch. “They can often be a first line of where we start to see the negative effects of macroeconomic headwinds.” Having access to a car is a necessity for millions living in areas without reliable transportation. Yet, prices for both used and new vehicles are historically high, declining only slightly from peaks during the pandemic, which has priced out many low-income workers who often need a car to get to work. For those with the best credit scores, interest rates are about 5.07% for a new car and 7.09% for a used vehicle on average, according to Bankrate. And for those with the worst credit, rates are about 14.18% and 21.38% for new and used cars, respectively. As payment delinquencies rise, repossessions are expected to increase accordingly. Cox Automotive estimates that 1.5 million vehicles will be seized this year, up from 1.2 million last year, although that’s still below pre-pandemic levels. NN: buying a plastic and chrome pick up truck for 50K financing it at 14% for 7 years… how do you think that will end up.
US President Joe Biden and Israel’s Prime Minister Benjamin Netanyahu committed on Sunday to secure a “continued flow” of humanitarian supplies into the Gaza Strip, the White House said, expanding on previous information about the joint call between the two leaders. Moreover, Biden and Netanyahu talked about “ongoing efforts” to help liberate all the remaining US nationals and from other nationalities still allegedly kept as hostages by Hamas and “to provide” a secure passage for those foreigners and locals who want to leave the area. During the weekend, a batch of 20 trucks with tons of supplies for Palestinians in Gaza finally crossed the border with Egypt after weeks of waiting for approval. BlackMask Pod Cast:
At the beginning of October, Saudi Arabia affirmed it would keep its voluntary oil production cut of 1 million barrels per day (bpd) until the end of the year and was in talks with the United States, which was brokering a deal on the normalization of Saudi-Israel relations.
But the Hamas attack on Israel on October 7 and the subsequent Israeli retaliation targeting Gaza upended, once again, the geopolitical landscape in the Middle East—the world’s top crude oil exporting region where the biggest oil transit choke point is located. Saudi Arabia’s de facto ruler, Crown Prince Mohammed bin Salman, is the wild card in the Middle East’s latest conflict, Reuters’ George Hay wrote in a commentary this week.
The United States Navy warship USS Carney, which is operating in the Middle East region, intercepted several missiles and drones fired from Yemen, Pentagon’s press secretary Pat Ryder said during a press briefing on Thursday. According to the official, the missile and drones were launched by Houthi militants. He added that it is still unclear what the projectiles were targeting, but underlined that the missiles were “heading north along the Red Sea, potentially towards targets in Israel.” Ryder also confirmed that several drones were launched toward the US bases in Syria and Iraq on October 17 and 18.
Drone Attacks Syrian Gas Field as Israel Conflict Escalates
In reports unconfirmed by the U.S. military, Syrian opposition figures claim that a possible Iran-backed group in Syria launched a drone attack on an oil facility and a U.S. military base in the country’s eastern region, as the Hamas-Israel conflict escalates. While no casualties were reported, and details remain sparse, Europe-based Syrian opposition activist Omar Abu Layla has said that three explosive-laden drones hit the Conoco gas field in Deir el-Zour province on the border with Iraq, the Associated Press reports. The Syrian activist report was confirmed by the UK-based Syrian Observatory for Human Rights, in terms of the Conoco gas field strikes. Syria has the potential to become a major renewed conflict flashpoint as Iran threatens to rally the militias it backs in proxy venues. The Syria drone strikes come after a 24-hour run of drone attacks starting on Tuesday and targeting U.S. bases in Iraq following the Gaza hospital explosion, for which blame is still being apportioned and denied. In western Iraq, two drones hit the Asad airbase in Anbar province, which houses U.S. troops, while another drone targeted a base in northern Iraq, the Associated Press reported, citing U.S. Central Command. Damage was limited, with U.S. forces saying they had intercepted and destroyed two and damaged the third. Minor injuries were reported at the Asad airbase.
Militia groups in Iraq backed by Iran’s Islamic Revolutionary Guard Corps (IRGC) have vowed to target U.S. troops over Biden’s support for Israeli airstrikes on Gaza.
These drone attacks took place while U.S. President Joe Biden was visiting Israel. While Syrian oil is of no consequence to the markets, there is growing concern that Iraq, the second-largest crude oil producer of OPEC, could become engulfed in the fallout from the Hamas-Israel conflict. NN: These are minor attacks. Blown way out of proportion. The oil markets pop is a profit taking opportunity. In a volatile market such as oil take your profits off the table often. Its a algo candle stick asshole world.. I know how to fuck this money…..
Oil prices dropped on Thursday after the United States announced it will temporarily suspend sanctions on Venezuelan energy exports. The US Treasury said the measures will be halted for six months following an agreement between Venezuelan President Nicolas Maduro and the opposition ahead of a possible election in 2024.
Meanwhile, the US commercial crude oil inventories fell by 4.5 million barrels to 419.7 million barrels in the week ending October 13, according to the latest report on Wednesday.
West Texas Intermediate (WTI) for deliveries in November lost 1.31% at 5:03 am ET and went for $87.16 per barrel. A minute later, Brent for December’s deliveries declined by 1.985 to sell for $89.74 per barrel. BlackMask Pod Cast: