Asking how to describe the unwinding in crude oil following President Trump's remarks.
Joe Mathieu
Mike McGlone
The $120 level will go down in history. We are shifting to massive cleansing in a bear market. The December contract (front month at election) is at $69. By the election, crude oil will be down on the year.
Questioning if Middle Eastern shut-ins mean the market will be tighter, correcting the prior surplus.
Kailey Leinz
Mike McGlone
In the short term, maybe, but price-maker status has shifted to the Western Hemisphere (US and Canada). Significant surplus of crude supply. They were able to aggressively sell forward, accelerating the trend to lower prices.
Asking if military escorts for ships are enough for traders.
Joe Mathieu
Mike McGlone
Traders seemed happy because there are no shorts left. The bottom line is securing the Strait of Hormuz. Everything else trickles down from that.