China’s Oil Demand Is Tumbling the Most Since Wuhan Lockdown

    China Fuel consumption in April to drop 20% from year  ago: sources
    • China is facing its biggest oil-demand shock since the early days of COVID when Wuhan was the epicenter of the outbreak.
    • Economic activity for the world’s largest crude importer has slowed because of a new wave of coronavirus infections.

China’s demand for oil is tumbling in April, as the country battles the latest wave of COVID infections by ordering massive lockdowns that are keeping people inside their homes and limiting industrial output, according to a Bloomberg report Friday. Gasoline, diesel and aviation fuel demand is on track to drop by 20% this month, sources with inside knowledge of China’s energy industry told Bloomberg. They said the decline is the equivalent to a drop in crude oil consumption of 1.2 million barrels a day. That would result in the biggest oil-demand shock in China since lockdowns began more than two years ago in Wuhan, the initial epicenter of the coronavirus outbreak that eventually turned into a pandemic. China is the world’s largest crude importer. Gasoline demand is logging the largest drop. Demand for diesel has slumped from the trucking industry, but there’s some support from the agricultural and industrial sectors. Energy demand is weakening as China tackles its latest wave of COVID infections by ordering millions of people to stay indoors under a zero-tolerance approach. During April, more than half of China’s largest cities were under lockdown measures, according to NPR. Most factories and offices reportedly remained closed in Shanghai, which is China’s biggest city and home to 25 million people. City officials on Friday said they would relax some restrictions on truck drivers to lessen pressure on food supplies and trade, the Associated Press reported. Amid the strict lockdowns, Beijing expects the Chinese economy to expand by about 5.5%, the lowest growth target since 1991. Prices for Brent crude, the international benchmark, and West Texas Intermediate crude each dipped on Mondays European open.  With Brent trading at $102.84 and NY crude trading at $98.42 a barrell at 5:00 AM NY time. Oil  has climbed by roughly 35% this year largely on the back of supply concerns stemming from the war against Ukraine by Russia, a major oil producer. NN: This is flat out a wrong assessment. China temporarily has consumption down by 2 million barrels a day at most. And that will shoot right back up once the quarantines are lifted…. And they will end.. We have seen over and over again once the captives are set free they go crazy and oil demand surges……. We are getting into buying opportunity land here.

Stocks, Commodities Tumble on China Covid Outbreak

(Bloomberg) — Fears about the economic toll of China’s strict Covid Zero policy intensified Monday, as news that lockdowns were spreading to Beijing sent stocks, commodities and the yuan tumbling. The benchmark CSI 300 Index dropped more than 4% to the lowest since May 2020, wiping out gains from a March pledge by officials to support the economy. The onshore yuan fell to its weakest in a year on concerns about rising capital outflows and oil sank below $100 on worries over Chinese demand. A Covid flareup that shut down much of Shanghai appeared to worsen over the weekend after China ordered mandatory tests in a district of Beijing and locked down some areas of the capital. The news echoed around global markets  with stocks and equity futures under pressure and havens like the dollar and Treasuries gaining.

“There are concerns about the Covid situation in Beijing evolving into what happened in Shanghai with some prolonged lockdowns that bites the economy,” said Kevin Li, portfolio manager at GF Asset Management (Hong Kong) Ltd. China Covid Spread Spurs Fears of ‘Darkest Moment’: Street Wrap. Traders are balking at the potential impact of coronavirus restrictions on growth in the world’s second-largest economy, which was already showing signs of slowing down thanks to a property crisis and increased regulation. The growth fears come amid China’s widening policy divergence with the U.S., which has led to foreign outflows and weighed on the yuan. Global investor nerves were already frayed after traders bolstered bets on a more aggressive pace of rate increases from the Fed and European Central Bank late last week. China’s Yuan Extends Decline on Currency Fixing, Covid Concern The Covid situation is putting the country into “the darkest moment in economic terms for the last couple of decades,” said Junheng Li, JL Warren Capital founder and CEO, told Bloomberg TV in an interview.  The renewed selling comes as investors grow weary about a lack of follow-through on policy promises last month to shore up growth and stabilize markets. Markets shrugged off Friday’s latest policy vow from the People’s Bank of China to ensure stability, which repeated commentary seen in the past month.  Analysts have started downgrading economic growth forecasts for this year below the government’s 5.5% target given the extent of the lockdowns, after a number of manufacturers and car makers highlighted supply chain disruptions.

In the stock market, a closely-watched support line for the Shanghai Composite Index is under threat. The benchmark is hovering near 3,000 points, a level it has held above for over a decade. In the corporate debt market, Chinese high-yield dollar bonds fell as much as 2 cents on the dollar Monday, led by developers, according to credit traders.

China’s strict adherence to Covid Zero is also sweeping through commodities markets, with the nation heading for the largest oil demand shock since the early days of the pandemic. Meanwhile, iron ore tumbled almost 12% in Singapore before paring around half of the drop. “The sharp price fall is mainly due to the burgeoning Covid impact,” said Chen Wen Guang, research director at Lange Steel Information Research Center, an industry group in Beijing. With “lots of areas affected, people are beginning to worry about demand.”  NN: this is overblown. Its a matter of weeks a month at the most and China will crank up the worlds biggest manufacturing machine again. Business has not been lost simply delayed. And China will spring back with a vengeance. Understand the things that Russia sold that are sanctioned will be supplied to the market through China……. Won’t that be fun.

Bearish Sentiment Drags Oil Prices Lower

While there are still plenty of supply risks that could send oil prices soaring, bearish sentiment has taken over oil markets this weak due to falling Chinese demand and the expectation of a global economic slowdown. Prospects of weakening economic growth globally have continued to weigh on crude prices, with the US Fed hinting at a half-point interest rate increase at the next policy meeting in May and China’s COVID woes getting ever-more protracted amid Shanghai announcing another round of lockdowns. Upside risks are still on the table with the European Union mulling oil sanctions against Russia and Libya on the brink of war, but for the time being bearish sentiment is pulling prices lower. The European Commission stated that Russia’s newly-introduced gas payment system that would convert prices into roubles in Gazprombank, a subsidiary of the country’s gas giant Gazprom  might be compatible with the EU sanctions regime, easing fears across the European gas market.  The World is Headed for a Protracted Energy Crunch. The world needs to find $1.3 trillion of additional investment by 2030 to ramp up global energy production and improve infrastructure, US investment bank JP Morgan said, otherwise the world risks seeing energy demand exceeding supply by a whopping 20%.  The US Department of Energy awarded contracts for 30 million barrels of SPR crude, with US refiner Valero and Saudi-owned Motiva Enterprises landing the largest volumes at 6.85 and 4.05 million barrels, respectively, implying most of the barrels will be refined domestically.  According to a recent study, China’s decision to ban overseas coal financing has led to the closure of 15 power generation projects with a total capacity of 12.8 GW and could potentially halt another 37 GW that are currently in the pre-construction phase.  US Wants Brazil to Produce More Oil. Brazil’s energy minister Bento Albuquerque said the United States has asked the Latin American country to produce more crude to lower outright oil prices, a feat Brazil considers logistically difficult as production has been hovering around 3 million b/d recently. Argentina Wants Gas Links Amid Booming Gas Output. Just as Argentina’s gas production rose 10% in March to reach a new monthly record, Argentina said it wants to speed up the construction of gas connections that would connect the Vaca Muerta shale play to Buenos Aires, with the government calling for a mid-2023 deadline for the planned Nestor Kitchener pipeline. Russia Asks for Full Pre-Payment in Crude Tender. Russia’s national oil company Rosneft has asked for full pre-payment in roubles (alternatively in Chinese yuan or Turkish lira, too) in its most recent Urals and ESPO tender for May-loading cargoes, amidst tangibly low Western buying interest.  As the April 22 wind-down deadline set for US refiners to halt buying of Russian crude and products comes into effect today, there has been a total of nine tankers delivering their cargo to the USGC, the overwhelming majority of which carried fuel oil. NN: The smartest thing America ever did was unleash fracking and built new pipelines. The dumbest thing America ever did under Biden was kill the domestic oil and gas production. Thats OK because Putin is coming to the rescue. at $100 oil. Soon to become $150 oil. For now let them pretendt that the strategic(ha ha ha ha ha ) release will make up for 10 million barrels a day in embargo lostproduction……..

Putin has launched the first economic world war, and the EU and the West are his targets

The Kremlin is prepared to disrupt the West and its socio-economic order

As momentous as Russia’s invasion of Ukraine is, the most strategically important event in recent weeks was the global economic war between Russia and the U.S. and its allies. Russia, however, has been preparing to confront the West and challenge the Western socio-economic model for a long time.

Russia’s strategic interests in Ukraine are well-known. The geography and history of Russia compel its leaders to create and preserve a buffer between Moscow and the major powers in Western Europe, and to ensure access to the Black Sea. Ukraine is crucial to both goals. But beyond Ukraine, the Kremlin perceives the eastward expansion of Western influence, including into Russia, to be a modern invasion by stealth that threatens the Russian regime. It is not Western organizations such as NATO and the European Union that challenge the Kremlin, but the socio-economic model that enabled the West to win the Cold War and that enticed Eastern Europeans to want to join the West. When he became president of Russia in 2000, in the wake of the Soviet Union’s collapse and the economic crisis of the 1990s, Vladimir Putin inherited a broken country. Many Russians contemplated joining the European Union, hoping that alignment with the West would bring a better life.  Putin sought to make Europe economically dependent on Moscow. Looking back at history and the current power balance, he identified Germany as the lynchpin of his strategy of dependence. Russian ties to Germany were key to establishing ties to the European Union more broadly, but this was only the beginning of Russia’s strategy in Europe. Russia opened up its economy to Western investment, established links throughout the Continent and tried to understand the inner workings of EU bureaucracy. It established close business ties with Italy, France and later Hungary, and built a political network that would help expand its influence in Europe. For Moscow, learning about European vulnerabilities was just as important as building up its economy and growing Russia into a stable economic power. The Kremlin also campaigned to join the World Trade Organization to establish deeper relationships with the world’s biggest economic players. In the process, it benefited from foreign investments in Russia and learned how the global economy works, building partnerships with not just Western economies but also other economic powers. The only problem was that China, its major ally against the West, was not seeing the accelerated growth it hoped for and was still very much dependent on the U.S. market, giving Beijing limited ability to counter U.S. interests in the world and forcing Russia to keep its focus on Europe. Then the pandemic hit. The Russian president apparently feared that the economic insecurity wrought by COVID-19 could threaten his country’s economic security and stability. As the worst socio-economic effects of the pandemic faded, action against the West became urgent. From the Kremlin’s point of view, this was a unique moment. The U.S. has been trying to reduce its presence in Europe and instead focus on the Indo-Pacific and domestic problems. In other words, from the Kremlin’s point of view, the trans-Atlantic alliance and the European Union appear weak. Most important, Russia’s leaders believe they have gained sufficient knowledge of the way the West works and can fight it effectively. Russia has been preparing to confront the West since at least the early 2000s. Besides stockpiling foreign reserves, Moscow constructed trade blocs and deepened relations with projects like the Eurasian Economic Union. In Europe, it enticed Germany to become dependent on Russian natural gas, which as is clear today made it extremely difficult for Europe to cut off Russian energy imports. Shifting from gas would require Europe to build new infrastructure — a costly, time-consuming process. The close German-Russian partnership also benefited the Kremlin’s Europe strategy in other ways. To give a practical example, the EU had plans to make the Danube River fully navigable through the establishment of additional canals, increasing Central Europe’s connection with the Black Sea. This would have given Europe more leverage against Russia at the moment, when the war in Ukraine has forced the rerouting of commercial flows from the Black Sea to much more expensive land routes. Instead, positive relations with Moscow made the project seem unnecessary, and it faded away. ‘It is no coincidence that after 2012, the first full year that Nord Stream 1 was operational, Europe became much more reluctant to adopt policies that could be seen as anti-Russian.’ There was simply no interest in Germany to carry them out. It is also no coincidence that relations between the U.S. and Germany have cooled over that time. The U.S. needed Germany to lead Europe, or at least maintain neutrality, to prevent Russia from expanding its influence in Europe as the U.S. drew back. The fact that Russia joined the World Trade Organization in 2012 gave it even more leverage in the world economy.  German Chancellor Gerhard Schroeder was tapped to lead Nord Stream 1. Nord Stream AG also hired former Finnish Prime Minister Paavo Lipponen as a consultant to speed up the permit process in Finland. Former Italian Prime Minister Matteo Renzi served on the board of Delimobil, a Russian car-sharing service. Former Finnish Prime Minister Esko Aho was on the board of Russia’s largest bank, Sberbank. Former Austrian Chancellor Christian Kern resigned from the board of Russia’s state-owned railway company in the early days of the war in Ukraine, while another ex-chancellor, Wolfgang Schussel, remained on the board of Russia’s Lukoil. Working closely with Europeans for the past two decades has enabled Russia to learn what is important for the stability of their countries. It has also helped the Kremlin better understand their political agendas and support causes that work to its advantage. For example, Russia enthusiastically supported many green policies, like Germany’s decision to give up nuclear power — which translated into greater reliance on Russian gas. And Russia has openly supported populist parties throughout Europe and effectively used information warfare, all in an attempt to destabilize and ultimately divide Europe. Globally, Russia has maintained close relations with traditional enemies and competitors of the West. Joining the WTO gave it a stronger position on the global stage, which is used to advance the influence and interests of emerging global players, including the BRICS countries, which also include Brazil, India, China and South Africa. Though the results were modest, Russia promoted the group as an alternative to the West and continued to focus on building ties to China and India, establishing links that it hoped would withstand in a potential confrontation with the West, which we’re seeing play out today. In building its network, Russia has tried to focus on economics and enhancing weaknesses in the global network. It expanded its influence abroad, making sure the dependencies it was encouraging were strong enough to give it leverage but lose enough to allow its withdrawal when necessary. Russian strategy certainly has its weaknesses, but Russia has options in countering the West during the current global economic war. Supporting EU fragmentation through its economic ties in Europe and using the knowledge of European politics that it’s gained over the years are likely the most important elements of its strategy. The moment European citizens feel the repercussion of Western sanctions is when the bloc will become more fragile, which will allow Russia to exploit the EU’s weaknesses.

The world is witnessing its first economic world war of the modern era. The rules are undefined, and the global economy is complex, meaning collateral damage is unavoidable and frequently unpredictable.

Slowly, we are becoming aware of the repercussions the sanctions on Russia are having on the global economy. Less clear are the instruments that Russia can employ against the West. NN: I am sorry if your senile president and his San Fran VICE president is clueless. But America like many FORMER world powers is napping. You need to understand Ukraine is the side show… The diversion. The real deal is the commodities war. A carefully engineered conspiracy is what is causing your energy prices, food prices and commodity prices to soar. Now you can get supplied at very high prices… Soon you will regard these as the good ole days when you see rationing and empty tanks and shelves. .

Wall Street sinks deep, Dow tumbles nearly 1,000 pts

Major stock markets on Wall Street recorded significant losses at Friday’s closing bell, with all three key indices tumbling more than 2.5% each in a single session. Ahead of the May FOMC meeting, Cleveland Fed President Loretta Mester said she would like to see a 50 basis point interest rate hike next month as well as several more times throughout 2022. Meanwhile, the latest report showed decelerating expansion of the United States services sector activity during March. The Dow Jones plummeted 2.82% or 981 points at the closing bell. The Nasdaq 100 declined 2.65% or 363 points, as Intuitive Surgical decreased by 14.34%. The S&P 500 lost 2.77% or 121 points, with HCA Healthcare plunging 21.82%. The euro fell by 0.39% against the dollar to sell for 1.07918 a minute earlier. NN: Putin, Putin, Putin. He is the Hitler of our time. And the food and energy inflation is starting to take its toll.

U.K. Supermarkets Limit Cooking Oil Purchases As Supplies Hit by Ukraine War

Supermarkets across the UK have placed limits on how much cooking oil customers can buy due to supply-chain problems caused by Russia’s invasion of Ukraine. Tesco is allowed three items per customer while Waitrose and Morrisons have placed limits of just two items each, according to the BBC. In comments carried by the broadcaster, the British Retail Consortium’s (BRC) Tom Holder said the move was a temporary measure “to ensure availability for everyone”. Richard Walker, managing director of Iceland supermarkets, said his shops were having to ration sunflower oil sales to one bottle per customer. Most of the UK’s sunflower oil comes from Ukraine, with the restrictions applying to that product as well as olive and rapeseed oils at some supermarkets. Mr Holder from the BRC said retailers were “working with suppliers to ramp up production of alternative cooking oils, to minimise the impact on consumers”. Recent data showed cooking oil was one of a range of food staples to have its price shoot up. The price of cooking oils and fats went up 7% and is nearly a quarter more expensive than a year ago, the Office for National Statistics said on April 13. Iceland boss Mr Walker told Today: “If you look at commodity prices, sunflower oil has gone up 1,000% in terms of the commodity cost in the market, palm oil (up) 400% and then there is things like wheat, 50%, fertiliser, 350%. “These are all unintended consequences of the war in Ukraine that is affecting supermarkets.” Tesco said in a statement: “We have good availability of cooking oils in stores and online. If a customer is unable to find their preferred oil, we have plenty of alternatives to choose from. The Russian tanks and missiles besieging Ukraine are also threatening the food supply and livelihoods of people in Europe, Africa and Asia who rely on the vast, fertile farmlands of the Black Sea region known as the “breadbasket of the world”. NN: Sleeping walking into oblivion. Putin can reach out and touch you…. in many ways. Soon you will see rationing of energy, food and essential minerals and metals… It always happens during war time… You did not know we are war? I am very sorry they have not told you…..YET! They are spinning a win by the Ukraine never give up “freedom fighters” What horse shit ..WHY are they doing this…. To cover up the fact that NATO the toothless tiger refuses to engage Putin NOW that he is easier to defeat. Putin is living a dream.. he gets to do what ever he wants in Ukraine, gets the biggest prices ever for his mighty commodities export machine, Topples democracies and their markets with massive inflation. Whats not to like

The next stage of war is unfolding, and it includes cyber attacks on power grids and oil refineries

Malware is simple to create and sell on the dark web. But even if the U.S. is targeted, it can easily strike back, escalating risks to dangerous levels.

The Department of Homeland Security’s cybersecurity unit has recently warned of a new malware toolkit called Pipedream that targets industrial control systems and could be used to cause physical damage or destruction. The hackers’ toolkit, which was discovered by security firm Dragos, is reportedly designed to target Schneider Electric and Omron Corp. programmable logic controllers (PLCs). While the malware is adaptable to different industrial environments, the focus on those two types of devices suggests that hackers may be specifically targeting power grids and oil refineries. The toolkit exploits multiple zero-day vulnerabilities. While patching them won’t prevent most of Pipedream’s capabilities, it is still recommended that infrastructure operators implement safety measures  — limit industrial control systems’ (ICS) network connections and implement monitoring systems — to protect their operations. The toolkit’s creators remain unknown. Dragos suspects Russian hackers, but the truth may not be so simple.  War brings out the worst in people, and cyberwarfare is no different. It seeks to undermine the enemy, its infrastructure and economy by targeting military installations and civilian infrastructure alike in order to disrupt day-to-day activities, and cause chaos and panic. Governments of embattled countries and their allies start recruiting hackers — individuals they previously sought to incarcerate — to task them with the creation of malicious software that can be used to target the enemy. Cyber attacks are launched, enemy infrastructure is damaged, and as a result hackers profit. However, the code they create doesn’t expire after its use. It is sold –– often multiple times — in dark web marketplaces. Malware toolkits can be bought for as little as $50; these marketplaces represent a good source of revenue for hacker groups operating globally. It’s possible that Pipedream’s source code originated on one such marketplace and is available not only to state-sponsored hackers but also to anyone willing to wreak havoc. Other than targeting specific pieces of hardware, Pipedream does not take sides in cyberwarfare. U.S. infrastructure may be compromised, but American hackers can decide to do the same to another country that has much more to lose. For example, a country with ample amounts of gas and oil just waiting to be disrupted. Russia could be a target. Its vast network of natural gas pipelines could be particularly vulnerable, and cyber attacks could easily interrupt supply and cause shortages and possible damage to the infrastructure. It would also be very difficult to discern which country was responsible if one such attack occurred. Deals like these happen behind closed doors, with actors on both sides taking precautions to obscure their identities. As you can see, the situation is much less black-and-white than currently presented in the media. If we dig a bit deeper, things get even murkier. Although the Pipedream malware toolkit is making the headlines these days, it’s only one of several similar pieces of code found in the wild that target industrial control systems software. The first and still most notorious example is Stuxnet — a brainchild of the National Security Agency, Central Intelligence Agency and Israeli intelligence — that was allegedly used to destroy nuclear enrichment centrifuges in Iran in 2010. This piece of code has been upgraded in many variants responsible for the majority of worldwide ICS malware attacks. While governments can work on hardening their networks, increasing security and mitigating damage, the best countermeasure is to simply go analog: A device without a digital input/output is impervious to digital attack vectors. Whether this means implementing backup analog modes that are activated in cases of emergency (and war definitely is one), or completely relying on manual operation is irrelevant. The end result is always minimization of damage and increased resilience of underlying systems –– at the cost of convenience. And in wartime, convenience should be the least of our priorities. NN: that is all well and good. But you need to figure out sooner when it will do you the most good that World War III has started

Europe won’t last week without Russian gas – Medvedev….. EU says gas payments may be possible under Russian roubles proposal without breaching sanctions

Moscow. 23 April. Interfax – Dmitry Medvedev, Deputy Chairman of the Security Council of the Russian Federation, believes that Europe will not be able to last the round without Russian gas.

“The European Commission allowed payment for gas in rubles and believes that the decree of the President of Russia can still be accepted by European business,” he wrote on Saturday night on his Telegram channel.

“We appreciate the consistency and integrity of our European partners…. Especially considering the fact that, according to the IMF, Europe can do without our gas for no more than 6 months,” he said. “Well, seriously, even weeks won’t last,” the Deputy Chairman of the Security Council of the Russian Federation specifically said. The day before, the European Commission confirmed that it had considered ways of bypassing the EU in the mechanism proposed by the Russian Federation in the event of a gas incident, but at the same time, it believes that the company from the EU finds a legal opportunity to pay for supplies in the new realities. In the published clarifications of the EC, it is realized that under the new scheme, the Russian Federation will fully control the conversion of dollars or euros into rubles. “It may be possible to connect the Central Bank to the operation (…), which is prohibited by the EU sanctions. Since the process of transferring one currency to another may take an indefinite time, during this entire process, the foreign currency will be under the control of the powers of Russia, in particular – the Central Bank” . At the same time, the document states that it is likely that companies have the opportunity to use the new mechanism without violating the prescription. “Companies from the EU can demand their Russian counterparts to fulfill contracts in the same way as to accept a new decree, that is, simply transfer the required amount in dollars or euros,” the German statement said. At the same time, the European Commission advises companies to check with their Russian counterparts whether this is really possible. Earlier, Western media reported, citing sources, that the European Commission presented to the parent states an analysis of the decree of Russian President Vladimir Putin on accidental cases of income from Russia in rubles and warned that its execution would require a penalty against Moscow.

EU says gas payments may be possible under Russian roubles proposal without breaching sanctions

BRUSSELS, April 22 (Reuters) – EU companies may be able to work around Russia’s demand to receive gas payments in roubles without breaching sanctions if they pay in euros or dollars which are then converted into the Russian currency, the European Commission said on Friday. NN: See how they run. I am so tired of the EU assholes blowing blue sky up my ass. Their is no alternative for Russia gas. And Europe is as i warned for the past 3 years is Putin’s  Bitch. Europe has no hair on the back of its ass.  Reality is Putin has won the energy war, the Metals war, the food war and will win the economic war on the great Democracies… The war in Ukraine was the trick to drive up GLOBAL energy prices…….. See the brilliant trick here? Any suggestion that  the “brave freedom fighters” of Ukraine are winning is a sick joke. Look at the bombed out cities the mass graves and tell me does that look like a win to you? Talk about fake news. Its time to wake up and smell the bullshit. The democracies of the worlds economies are being crushed in massive energy induced inflation. Interest rates will shoot to the moon, stock markets will crash, real estate foreclosures will set a new records. Tell me again how Putin is stupid,,,,, tell me again Wolf Blitzer of CNN how Putin is losing…….  The corona virus must be making them all stupid……..

Chinese Oil Demand Set For 1.2 Million Bpd Plunge In April

https://youtu.be/OP7_kIz9IuU

  • Demand for oil in China is on course to drop by 20% in April, Bloomberg reported Friday.
  • China is facing its biggest oil-demand shock since the early days of COVID when Wuhan was the epicenter of the outbreak.
  • Economic activity for the world’s largest crude importer has slowed because of a new wave of coronavirus infections.

China’s demand for oil is tumbling in April, as the country battles the latest wave of COVID infections by ordering massive lockdowns that are keeping people inside their homes and limiting industrial output, according to a Bloomberg report Friday. Gasoline, diesel and aviation fuel demand is on track to drop by 20% this month, sources with inside knowledge of China’s energy industry told Bloomberg. They said the decline is the equivalent to a drop in crude oil consumption of 1.2 million barrels a day. That would result in the biggest oil-demand shock in China since lockdowns began more than two years ago in Wuhan, the initial epicenter of the coronavirus outbreak that eventually turned into a pandemic. China is the world’s largest crude importer. Gasoline demand is logging the largest drop. Demand for diesel has slumped from the trucking industry, but there’s some support from the agricultural and industrial sectors. Energy demand is weakening as China tackles its latest wave of COVID infections by ordering millions of people to stay indoors under a zero-tolerance approach. During April, more than half of China’s largest cities were under lockdown measures, according to NPR. Most factories and offices reportedly remained closed in Shanghai, which is China’s biggest city and home to 25 million people. City officials on Friday said they would relax some restrictions on truck drivers to lessen pressure on food supplies and trade, the Associated Press reported. Amid the strict lockdowns, Beijing expects the Chinese economy to expand by about 5.5%, the lowest growth target since 1991. Prices for Brent crude, the international benchmark, and West Texas Intermediate crude each dipped about 0.8% Friday but remained slightly above $100 a barrel. They have climbed by roughly 35% this year largely on the back of supply concerns stemming from the war against Ukraine by Russia, a major oil producer. NN: two points here. The lockdowns will end, so the drop in demand is temporary. Lets say China demand is down 2 million barrels a day. Reality is the market is short 5 million barrels a day at the slowest demand time ot the year. Add strategist stockpile releases of 1.5 million barrels a day. And you can see the market is still short 1.5 million barrels a day. BUT we are coming to peek flying and driving season which will bump demand by 3 million barrels a day and when china comes back its damned will increase by 2 million barrels a day. So anyway you cut it at best the market come July will be short at least 5 million barrels a day. And as more sanaction come to play that shortage could be 10 million barrels a day. That is enough shortage to bring gasoline, diesel fuel and jet fuel rationing…. It should be a summer of fun.

 

Scholz says top priority is avoiding NATO confrontation with Russia

BERLIN (Reuters) -NATO must avoid a direct military confrontation with Russia that could lead to a third world war, German Chancellor Olaf Scholz said in an interview with Der Spiegel when asked about Germany’s failure to deliver heavy weapons to Ukraine. Scholz is facing growing criticism at home and abroad for his government’s apparent reluctance to deliver heavy battlefield weapons, such as tanks and howitzers, to Ukraine to help it fend off Russian attacks, even as other Western allies step up shipments. Asked in an extensive interview published on Friday why he thought delivering tanks could lead to nuclear war, he said there was no rule book that stated when Germany could be considered a party to the war in Ukraine.

“That’s why it is all the more important that we consider each step very carefully and coordinate closely with one another,” he was quoted as saying. “To avoid an escalation towards NATO is a top priority for me.”

“That’s why I don’t focus on polls or let myself be irritated by shrill calls. The consequences of an error would be dramatic.” This was a departure from his previous statements on the topic, focusing on the fact that Germany’s own military’s stocks were too depleted to send any heavy battlefield weapons while those the German industry has said it could supply could not easily be put into use. Asked why he would not explain his government’s reluctance with the threat of nuclear war, he said such “simplifications” were not helpful. Separately, Scholz defended his decision not to immediately end German imports of Russian gas in response to what Russia calls a “special military operation” in Ukraine. “I absolutely do not see how a gas embargo would end the war. If (Russian President Vladimir) Putin were open to economic arguments, he would never have begun this crazy war,” he said. “Secondly, you act as if this was about money. But it’s about avoiding a dramatic economic crisis and the loss of millions of jobs and factories that would never again open their doors.” Scholz said this would have considerable consequences not just for Germany but also for Europe and the future financing of the reconstruction of Ukraine. NN: We are in a mindless rush to World War III. And the use of  theater nuclear weapons are a possibility and a real threat. War is like a forest fire. It starts with 1 match in a camp fire and spreads and spreads to where it can destroy hundreds of thousands of acres. The currency of war is hatred and the fuel of war are weapons. The more billions and billions of dollars in bigger and bigger weapons that pour into the Ukraine the bigger the fire and the greater the spread……. The Ukraine war has a real possibility of spilling over into the former Soviet states like Poland and Romania. And we do not know how much in weapons and man power NATO will throw at a war in Poland…