Today's optimism is unwarranted verbal intervention; US blockade remains, Iran says strait is closed; market wants conflict to end so responsive to positive headlines.

Unless real breakthrough this weekend, it will reverse; world's largest oil disruption actually got bigger with Iran export blockade.

3-4 months minimum for oil side; natural gas could be years; some fields may never recover; security premium will remain as Iran showed ability to strangle Hormuz.

Even after facilities/boats queue up, security premium persists because Iran demonstrated capability to block strait long-term.

Shortages first in Asia (diesel/jet), then will pull barrels from Atlantic/Gulf; US crude exports near record, stocks will draw; watch European product stocks for inventory draws.

Similar to COVID pattern: Asia first, then Europe, then US; desperate Asians coming to Atlantic basin; jet fuel is the real shortage concern.

China doing better than Asia; stockpiled 1.2-1.3B barrels crude; not facing same shortages; parceling out refined products to curry favor with starving Asian countries.

China not enjoying high prices or discounted Iranian oil, but insulated by strategic reserves.

Europe will have to pay high prices to bid barrels away from Americas or go without; refining margins negative, runs reduced; will see extreme price increases, rationing, demand destruction.

Market price-induced demand destruction already starting with canceled flights; Europe faces shortages or must pay premium for distant barrels.