Thread by @jens39630674

1/10 Focus on demand destruction in oil getting more coverage.
Demand destruction meets supply issues.

#Oil , #xle , #CrudeOil , #energy

2/10 I have written a number of threads since March this year about my assumption that global oil demand peaked in 2019. The reasons can be found in the threads listed below.

3/10 The rebound from COVID crisis level oil demand in 2020 & firm crude prices have been mistaken by many as a return to perpetual demand growth. Instead the rebound to 'normal' economic activity met inelastic supply taking longer to rebound further elevated by the 🇺🇦 invasion.

4/10 While supply side issues have had plenty of coverage I noticed that more analysts, traders & media started to talk about demand destruction in crude oil. Part of it is the assumption of a looming recession. Here is independent oil trader Vitol:

bloomberg.com/news/articles/…

5/10 Here is the latest from the EIA on US gasoline consumption falling below 2021 levels in Q2.

6/10 Here is @Geo_papic on China oil demand. He comes at the issue from "China has peaked as a great power" angle but the effect on oil demand growth is obvious.

7/10 Here is oil analyst @GregorMacdonald updating his 2022 oil consumption forecast. His July 6th update reflects a further downgrade in expected oil demand by 0.79 mbpd since April 20th.

8/10 Some diehards out there still seem to assume further oil demand growth (substitution from expensive gas to oil) in the rest of 2022. Below from the twitter feed of @Josh_Young_1

9/10 If want to hear a case for serious demand destruction, listen to the latest Macrovoices podcast with @JeffSnider_AIP. He makes the case for a deflationary recession.

macrovoices.podbean.com/e/macrovoices-…

10/10 We shall see what the rest of the year has in stock for us. Supply issues in crude are likely to remain but they are meeting meaningful demand destruction.

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