Thread by @ektrit

SUPPLY CHAINS VS ENERGY

Let me explain this again, here's another #krisonomics lecture for free.

1/

You've heard that OPEC wants $100 oil.

That is false. It's Shadow Banking which wants $100 and higher oil, not OPEC.

After all, It was Saudis who dumped dark inventory oil in March 2020 to send it to negative price.

2/

That is why OPEC from time to time sends out notices saying that oil price is really not controlled by them, but they don't mention who controls it. (Hint, it's shadow banking).

3/

The reason is very simple, and Saudis/Opec know it quite well.

FIRST, PEOPLE, PLEASE STOP THINKING LINEARY.

Nothing is linear in real life.

4/

The difference between $50 oil and $100 oil is NOT the mathematical 50%.

The effect is 500%, it is 1000% effect on supply chains.

Saudis know this, that is why they keep dumping dark inventory periodically.

But, why? What do Saudis know?

5/

Except for Canada and Norway, all other major oil suppliers basically produce nothing. OPEC countries produce nothing. They import almost everything they need.

So, a 50% difference in oil price between $100 and $50 per barrel, causes supply chain breakdown.

6/

Supply chain breakdown causes shortage of goods and services per hour, which causes inflation.

As you know, #krisonomics infallibly postulates that inflation is always and at anytime a shortage of goods and services issue, not a monetary issue.

7/

So, by importing goods and services from manufacturers which have now increased pricing (aka inflation), Opec/Saudis/Russia would be importing.................INFLATION.

You get the point folks?

8/

What did inflation do in 2010-2012?
Arab spring

What did inflation do in in 1989? Tien an men protest in China.

Inflation brings down governments and tyrants.

9/

Riyadh knows this. Moscow knows this. OPEC knows this.

They all know this.

The issue is about HOW OIL IS TRADED.

ONLY FEW KNOW THIS, and few talk about this.

10/

I have explained here for my friends FOR FREE, how oil market works.

…s-is-a-dogmatic-religion.blogspot.com/2021/11/how-oi…

It is what it is.

Everybody know is obligated to play by that structure.

Oil price is set by shadow banking, not opec.

11/

Saudis, Russians and OPEC play by those shadow rules when it interests them, and then when they see that INFLATION is being imported, thus their governments fall in danger of collapse, they let is collapse. Then, lather, rinse, repeat.

Start over again.

12/

So, to summarize:

- Shadow banking controls oil price
- Oil producers cooperate with shadow banking, by preselling oil to them at high price.
- Oil price shoots up from dark inventory in shadow banking.
- Supply chain breakdown, hence inflation ensues.

13/

-Riyadh/Moscow/OPEC fearing societal collapse from inflation, release dark inventory into the consumption market.
- Oil price collapses.

Lather, rinse, repeat.

14/

The problem with this game, is that it can't continue for long as supply chains DO NOT recover quickly from breakdown.

That point is now, the shadow inventory game has broken supply chains to the point that the game can no longer be repeated now.

15/

The coming dump of dark inventory will be the last dump for some time now, as supply chains have broken down to the point of incapable of recovering due to repeated events of #EnergyStarvation , 2008, 2014, 2018, 2020, and next, 2022-2023.

16/

It will be Saudis, Russians and OPEC themselves who will push for low oil prices for a very long time, 8-10 years, as they can't afford IMPORTING INFLATION which comes from higher oil prices they would export, if the game kept on.

17/

So, folks, first and foremost:

STOP THINKING LINEARY.

Secondly:

Start thinking 2nd order events, 3rd order events etc etc etc.

Oil price will drop to $10 and then hover between $20-40 for the next 8-10 years. All want that, all.

I love you all!

18/ END OF THREAD.