As I will explain, the outcome that looks like losing may actually be the best path forward for the world’s remaining economies.
The fighting today is with respect to which parts of the world will get which energy resources, and at what prices. Even before the current conflict, there was a shortage of jet fuel and diesel. The only reasonable outcome I can think of is that the US will only be able to tap its own energy resources, plus those of its nearby neighbors (Figure 1). Consequently, the economy will gradually reorganize in ways that use fuels more sparingly.
The outcome outlined in Figure 1 implies that Donald Trump and the US-Israel coalition will lose the war against Iran. It appears that the physics of the situation (or perhaps the Higher Power behind the physics of the situation) has chosen the flawed personality of Donald Trump to accomplish the required result. This is a situation where what seems to be the US losing in its conflict against Iran is actually winning for the overall world economy. If oil can be used more sparingly in the future by servicing people closer to where end products are made, the available energy resources will provide greater benefit to society as a whole.
In the remainder of this article, I will try to explain the situation more fully.
[1] Background
In physics terms, an economy is a dissipative structure. In order to stay away from a dead state (collapse), it needs to “dissipate” energy of the right kinds. A human is also a dissipative structure. We dissipate food to stay away from a dead state.
From a physics point of view, fossil fuels are as essential to economies as food is to humans. Without fossil fuels, economies tend to collapse and die. With an adequate supply of easily extractable and transportable fossil fuels, economies are able to grow. However, when these fuels become less available due to the exhaustion of nearby resources, or for other reasons, economies are forced to shrink. Rising population can also be a factor because every person in the world needs food and at least minimal transportation. The war is about future standards of living in countries around the world.
An underlying problem is that the world now has too many people for the available resources, such as fresh water. One chart showing data through the end of 2023 indicates that the Middle East is home to 4,863 desalination plants, or about 42% of the world’s total. This region is acutely stressed for fresh water. The Middle East cannot grow much of its own food; it must depend on imports, which are grown and transported using oil.
Previous analyses (here and here) have shown that diesel and jet fuel supplies have been in increasingly short supply since long before the Iran War.
Critical minerals, used in electrification, are also in very short supply. In a finite world, the easy-to-extract minerals are extracted first, leaving the high-cost-to extract minerals for the future.
In today’s fossil fuel economy, oil is the largest component. Oil is usually the highest-priced of the fossil fuels because it is energy-dense and easy to transport and store. If oil supply fails, an economy is likely to collapse. Coal and natural gas are the other fossil fuels. Liquefied natural gas (LNG) is natural gas that is super-chilled and shipped long-distance by boat. Similarly to oil, its price is under pressure today.
[2] The world’s fossil fuel economy already seems to be at a turning point in its economic cycle.
It is well known that economies exhibit cyclical behavior. Researchers Peter Turchin and Sergey Nefedov analyzed eight economies that collapsed and published their findings in their book Secular Cycles. They found that populations that discovered new resources were able to grow for a period of time until they came close to the carrying capacity of the resources available. After approaching the carrying capacity, economies reached a period of stagflation, characterized by slower growth, inflation, and spiking prices as shown on Figure 3.
At this point, the fossil fuel system has been growing for over 200 years. It has undergone stagflation since the early 1970s. It is now ready to begin the downswing of the Crisis Years.
Now, the Iran War seems to mark the beginning of a fairly long Crisis Period. The Stagflation Period was expected to last 50 to 60 years. The year 2026 is 56 years after the time US crude oil production stopped growing, so the timing is roughly in line with expectations. However, we don’t know whether the Crisis Period will really last between 20 and 50 years, since the situation is now quite different compared to cycles before fossil fuels were added to the economy. But it does look like the world economy is headed for reorganization based on the limited fuel supply.
[3] In order for an economy to “work,” oil prices need to be both low enough for consumers, buying end products such as food made possible by the use of oil, and high enough for oil producers.
This issue is not one most people think much about. There are really two different oil price levels that are important:
(a) The price level affordable by consumers. If consumers cannot afford food or basic transportation, this quickly becomes a problem that leads to unhappiness with elected officials. This is the reason why elected officials often try to hold down oil prices.
(b) The price that oil producers require in order to make an adequate profit and allow investment in new wells to offset depletion in existing wells. In the case of oil exporters, oil prices may need to be very high to permit high taxes on oil exports to support food subsidies and other government programs.
I believe that a major problem we have reached today is that countries that are primarily oil exporters, such as Russia and countries in the Middle East, need far higher oil prices than consumers are able to pay. Even if the wars in Ukraine and Iran stopped tomorrow, the world would still have this underlying issue.
[4] Since 2014, oil prices have been too low for countries that use taxes on oil exports as a major source of tax revenue.
Figure 4. Oil prices in 2025 US$, with ovals marking three different oil price periods. Oil prices are based on oil data from the 2025 Statistical Review of World Energy, published by the Energy Institute, adjusted by the US CPI Urban increase to 2025 levels. The 2025 average Brent oil price is from EIA data.
Figure 4 shows average world oil prices on an inflation-adjusted basis, to 2025 price levels. As such, prices for earlier dates appear much higher on the graph than past observers would have seen them.
The low oil prices from 1948 until early 1973 were good for economies around the world, including the US. In the early days of oil extraction, oil was easy to extract and close to where it was to be used. The cost of extraction and transport was low. Consumers started seeing many more products become available. Many families in the US could afford a car for the first time. Also, the US was able to support the recovery of European economies from the impact of World War II at a cost that was not excessive.
In recent years, costs have risen. This is especially the case for the price needed by oil exporters. Part of the problem is that the size of the population requiring subsidy keeps growing, while oil production has been close to flat.
A second part of the problem is that economies of oil exporters often have few other sources of taxable revenue. Oil exporters are trying to change this by adding downstream manufacturing that uses the oil and gas they produce. A third part of the problem is that, as population grows, the higher population tends to use more of the available oil supply, leaving less for export.
Figure 6 shows that, in the 2011-2013 period, oil prices seemed to be high enough for most OPEC members (except Iran). Fiscal break-even prices indicate how high oil prices need to be, including the amount of tax revenue needed to balance budgets.
The notation in yellow on Figure 6 shows that the expected fiscal breakeven break-even for the period under analysis for all OPEC members combined was $105. EIA data shows that the average Brent oil prices during this period were $111 in the year 2011, $112 in the year 2012, and $109 in 2013. Thus, prices were high enough for most producers. Iran was an outlier on the high side, with a range for the 2013-2014 period of $110 to $172. (A more recent forecast for Iran shows a 2025 fiscal breakeven price of $124, which remains far above the pre-Iran war oil price.)
Figure 4 shows that oil prices began to fall in 2014. At these lower levels, it became increasingly difficult for oil exporters to obtain enough tax revenue to significantly help their local populations. They started needing to use more debt to fund their local economies. As a result, they gradually became increasingly unhappy. Figure 4 shows that the average price 2025 for Brent oil was only $65.
To make matters worse for oil exporting countries requiring high prices, oil price forecasts by the EIA and IEA for the year 2026 were even lower because of an expected oversupply of oil. Countries with growing oil production included Argentina, Brazil, China, and Guyana. In addition, some counties on the coast of Africa are hoping to add oil production. Unless world demand is growing rapidly, more oil supply tends to lead to lower prices and a worse situation for oil exporters trying to balance their budgets with taxes on exported oil.
[5] Without the war, LNG prices would also have been too low for LNG exporters.
LNG is a “modern” way of shipping natural gas. Only about 13% of natural gas is transported as LNG. It tends to be an expensive method of transport. Recent reports indicate that a huge amount of future LNG supply is planned for the next few years.
Adding a huge amount of LNG would probably cause prices to drop significantly. This would be great from the point of view of consumers, but it would likely leave prices too low for producers. As I see the situation, Middle Eastern producers are likely to need prices in the $15 to $20 range per million metric tons of LNG, while India is not willing to pay more than $10 per unit, and those wanting to replace coal are unwilling to pay more than $5 per unit. Thus, without the war, LNG would have had a similar problem to that of oil, with prices far too low for exporters.
[6] From Iran’s point of view, I see the war as similar to a suicide, when a farmer can no longer support his family.
With Iran’s fiscal breakeven price at $124 per barrel and the pre-war Brent price at only $65, Iran was already in an impossible position. In fact, Iran could see that all of the Middle East infrastructure would be close to worthless, at expected 2026 oil and LNG prices. So why not take it down as well?
If nothing else, a war might help raise prices, at least a bit. Notice that on Figure 4, oil prices bounced up a little from their very low level in 2022, the year when the Ukraine conflict started.
[7] Losing any significant share of energy supply is likely to significantly reduce world GDP.
If the energy supply were to be lost, the world would be dealing with the losing something equivalent to its food supply. If the world economy loses even 10% of its oil and LNG, it is not difficult to imagine world GDP falling by 10%. At this point, we don’t know precisely how much energy supply, of which kind, will be lost, or for how long. The amount lost could be far higher than 10%. Also, the outage could last for years.
There are many issues involved. Supply lines are breaking down forcing businesses to find closer sources for both energy products and products made using cheap local energy products, such as fertilizer and aluminum. The war, as it is taking place today, is leading to major damage to energy-related structures in the Middle East. Destroyed LNG structures are estimated to take at least five years to replace. Damage elsewhere is also immense. Rebuilding the oil infrastructure will also likely take at least five years.
[8] The US understands the importance of Middle Eastern oil and gas. It uses its strong relationship with Israel to further its military presence in the Middle East.
Israel is a very high-level ally. In fact, a 2025 US Department of State Fact Sheet says that the US is committed to helping Israel in the case of an attack:
Steadfast support for Israel’s security has been a cornerstone of American foreign policy for every U.S. Administration since the presidency of Harry S. Truman. . . Israel is the leading global recipient of Title 22 U.S. security assistance under the Foreign Military Financing (FMF) program. . .Israel has been designated as a U.S. Major Non-NATO Ally under U.S. law. This status provides foreign partners with certain benefits in the areas of defense trade and security cooperation and is a powerful symbol of their close relationship with the United States. Consistent with statutory requirements, it is the policy of the United States to help Israel preserve its QME, or its ability to counter and defeat any credible conventional military threat from any individual state or possible coalition of states or from non-state actors, while sustaining minimal damages and casualties.
However, if we look to see where US military bases are located, they are not in Israel. Instead, a map shows that the “persistent” US military bases are all located around the Persian Gulf (Figure 8).
These bases were clearly intended to protect oil transiting through the Persian Gulf. At this point, all of the persistent bases have been severely damaged by missiles from Iran.
The major interest of the US has been the availability of oil and natural gas from the Middle East. No one ever considered the idea that low prices might be the force that would bring down Middle Eastern oil and natural gas exports.
Friendship with Israel provides the US a convenient close by ally. It also pleases both Jewish Americans who support Israel and those evangelical Christians who hold a religious view that Israel is needed for the second coming of Christ. Some of the latter may even believe that a war in the Middle East could perhaps hasten this event.
[9] Trump realizes that winning the war against Iran is absolutely essential if the US is to retain global hegemony.
The US has been the holder of the world’s reserve currency since immediately after World War II. It was chosen for this role because it was the most trusted and dominant country in the world. International trade took place almost exclusively in US dollars, creating a high demand for US government debt. This allowed the US to import more goods and services than it exported, year after year. This advantage tended to raise the standard of living of US residents.
At one time, Saudi Arabia insisted that all oil purchases be made in US dollars. This requirement has recently expired, but, as a practical matter, the majority of purchases have continued to be through trades in US dollars.
One of the main ways that the US has maintained its hegemony is by building military bases around the world. With these bases, the US can claim to protect countries against aggressors. However, recent events have shown that Iran is able to take down the radar systems at these bases. Without radar, the bases are virtually useless. If the US is to maintain the illusion that it is truly at the top of the pecking order with its sophisticated weaponry, it must show that, together with Israel, it can prevail against Iran.
A disadvantage of the role of being the chief hegemon is ever-rising US government debt and the need to pay interest on that debt. This growing debt and the interest on the debt has become an increasing burden.
If the US should lose its hegemony role, the advantage the US has had over other countries in trade is likely to disappear. Repaying debt with interest is likely to become an even worse problem. If this should happen, Trump will no longer be able to think about making America great again.
[10] Conclusion
The world is now facing a problem that most people never considered possible: Oil and LNG prices can fall so low that production becomes unprofitable for major oil and LNG exporters. Until now, the trend among world leaders, including President Trump, has been to try to hold prices down for consumers, so that food and fuel for vehicles would remain affordable. However, this has created a problem in that prices have become too low for countries whose primary industry is being an oil exporter.
At this point, the world economy needs to make a major transition in order to deal with the inadequate level of fuels available for long-distance transportation. These same fuels are heavily used for farming and for many for commercial endeavors, such as building homes and roads. It is therefore necessary to find ways to use these fuels more sparingly. One way to achieve this is by reducing the length of most supply lines, as shown on Figure 1. Shorter supply lines will also be needed elsewhere in the world.
It is ironic that the world economy cannot make a change such as this without a war to focus our attention in this direction. Other changes will also be needed. Governments will probably have to become smaller and provide fewer services. Vacation travel will become the exception rather than the rule. “Working from home” will become the norm, whenever possible. I expect that the world’s population will need to fall, albeit in a fairly subtle way. I expect this will mostly be the result of shorter life expectancies.
We are fortunate that economies are self-organizing. If resources are available, even after a major schism such as the loss of the war against Iran, the self-organizing nature of the economic system will try to knit together pieces that can productively provide goods and services. This cannot happen instantly, but this feature means that there are likely to be some jobs and some goods and services available. Past cycles of the type illustrated in Figure 3 have eventually led to new beginnings.
If the US and Israel lose the current war against Iran, I expect President Trump to be blamed for this loss. However, I believe that this outcome would be best for the world as a whole.
It’s interesting to see Chris Martenson chasing the idea that AI and the current war situation that is having on fuel and food production is a sign that TPTB are trying to get rid of us.
Behind a paywall: “They don’t announce it. We don’t vote on it. They just turn the dials and watch the numbers fall. Today we follow the pattern nobody wants to say out loud: if energy and food are being quietly throttled, then the question isn’t whether it’s accidental… it’s who decided there are too many of us to keep the machine running.”
https://peakprosperity.com/episode-19-of-the-wake-up-call-what-are-the-ai-models-telling-them/
Nathaniel and Gail has some good remarks put in here a few days ago and I would like to reiterate. Even if SoH is open, it is not likely to have any insurance and until that time no ship will go in. However, another critical point is – no ship owner will go in either because the ship might be stranded if things go south again. It will be a huge stranded asset inside the Gulf. I guess even if it opens today, it is still closed.
My comment – same goes for repairs. A large international team has to be there onsite and no repair team will be there if it is not safe (yes no insurance will cover the repair team if it is not safe).
Question – How do you define “safe”? Could be years or never happen at all?
I define safe as the Global Peace Accords, but you already knew that.
Gail, the 20-day limit is about to come up. Maybe you can extend to 30 days?
Australians after the oil runs out! (comedy)
https://apocalypseofsean.substack.com/p/australians-after-the-oil-runs-out
Lol
Animals are capable of acts of cleverness that are astounding. They to balance between dual operating systems. Maximum power principle and not maximum power principle.
Behavior demonstrates operating systems.
Twice the USA has had leaders that dance to another drum. And all the politicians support their behavior. They share a operating system.
We are surprised. We think they are mad. We thought their operating system was something else. We thought it was sophisticated not clever. We are unable to accept the reality the behavior demonstrates. The reality is it was never completely hidden. Such a primary operating system could never be hidden completely. We discarded that because it did not fit our paradigm.
What cuts through the veneer? Existential threats. A experienced organism identifies existential threats and behavior matches. It’s not nice at all. We all like niceness. I like niceness very much. What we like does not matter. .
Honesty is relative. Organisms that practice maximum power principle as a primary always give hints. They may attempt to hide it out of cleverness but to do so completely is beyond their capability. The question is are we listening? Usually not. We like things nice. I like things nice. It’s only when things turn out to be not nice that we listen. After that we can develop listening skills that don’t fit our paradigm. Often we cal this intuition. Intuition is not magical. It is the part of us that is willing to listen.
I think we will continue to be surprised as great nations continue to reveal their operating system is maximum power principle These behaviors often seem clever but not sophisticated.
https://m.youtube.com/watch?v=R9f8Kt2E6K0&pp=ygURY2FuYWRpYW4gcHJlcHBlciA%3D
That’s what I’m talkin bout, dog. You da man.
Beam is rackin up the frequent flyer miles. Beam loves highly conductive metal.
Hand is covering for the peak oil BNS with the “They’re destroying the oil for Great Reset depopulation agenda!” zombie dissident narrative that was groomed into the movement by plandemic. Naturally the two great set-pieces of the DA are symbiotic. It matters not that probably a fifth of those pareto principle zombie dissident comments are probably from the horse’s mouth.
In truth the Hand is doing its best to manage a worst case scenario, and doing it the only way it knows how, by playing god. Welcome to the People Farm. Hand is going into retirement because Hand’s lifespan is coming to an end in a few years or so. Time to downsize. The ambitious, proud, successful farmer always waits til the last minute. Naturally his wife would disagree with his sense of timing. Wife thinks he left it too long. Tim Watkins, Nate Hagens, and all the rest are playing the role of armchair quarterback wife. It’s not that they don’t mean we’ll, it’s that they’re at a remove and not in the trenches. The Hand loves the Farm and the killable family just as I love my farm and my edible family.
C’mon man . This ain’t reddit. This is family.
Yeah exactly. It’s not like the Hand doesn’t give plenty of notice. It always does. Look at the BNS. PLENTY of notice. Ditto the plandemic. It’s not its responsibility to babysit people who don’t want to know, and people who are in no position to know aren’t it’s responsibility either under the law of Shit Happens. All it can do is give plenty of notice and let the chips fall where they may. Hell, Shit Happens is ultimately even how they became members of the Hand. They were in the vicinity of the Egregore and became the Egregore. It’s all Marvin Harris’ soft-deterministic “cultural materialism.” Welcome to Civilization.
More like welcome to civilization not now. Hey we still have humor. That’s a lot. Ke sera.
Tribal societies were the epitomy of engineering. Nothing is perfect. Yeah I know everyone is a critic. Still… No accounting for taste I suppose.
I’m certainly not perfect. I’ve tried not to waste too much. I certainly used my share in the big picture. A bath every day… Is that ostentatious?
I guess we could say that they were the epitome of low-intensity engineering, but I think we could find characterizations better suited to the general grace with which they approached their ecologies.
I shower about once every ten days and haven’t used soap in fifteen years unless I just got finished wrenching on one of my probably dozen or so internal combustion engines. A dozen, is that ostentatious? I ended up in the vicinity of them. Was never supposed to.
This is worrying . The 3 ports are from where 80% of India’s import of Russian oil came from = 1.60 mbpd . Now India will have to look for other suppliers while the pipelines are drying out .
” ➡️ The ports of Primorsk, Ust-Luga, and Novorossiysk account for almost half of Russia’s crude and product exports, and all three have been under repeated drone strikes since late March (see our report from last week 👇).
➡️ We didn’t know what the net effect of the shutdowns and restarts would be, but now we are getting an idea.
➡️ The Druzhba pipeline usually ships 200kbd to Hungary and Slovakia, but it went offline in late January, so wouldn’t have affected the April-vs-March figure.
https://x.com/RusOilGasExpert/status/2046564887816528249/photo/1
Please read this . I am underestimating the problem . India imported 2.25 mbpd in March after the US waiver . In Jan- Feb it was 1.50 mbpd . This means that India grabbed all the Russian oil that was at sea . Now the offshore cushion is gone and the loading points are damaged . Double whammy .
https://www.reuters.com/business/energy/indias-march-crude-imports-slide-iran-war-russian-volumes-hit-record-high-data-2026-04-21/
So India seems to be heading in a direction similar to South Korea.
India Income per capita $ 2800
SK Income per capita $ 34000
No match . India is already way down the road to a collapse .
Yikes ! Is Europe next?
At some point Indias government will demonstrate behavior that is maximum power principle. This behavior is not necessarily sophisticated. It will do whatever behavior it perceives has the best chance of restoring energy inputs. This behavior is often surprising as the models we held o be true are found to be false.
Two weeks . Currently there are elections in 4 crucial states which Modi must win , so all tough decisions are postponed .
Exclusive-Russia to halt Kazakhstan’s oil flows to Germany via Druzhba, sources say
Reuters 21.4.2026 By Gleb Bryanski
MOSCOW, April 21 (Reuters) – Russia is set to stop oil exports from Kazakhstan to Germany via the Druzhba pipeline starting from May 1, three industry sources said on Tuesday.
The sources, who spoke to Reuters on condition of anonymity, said that an adjusted oil exporting schedule has been sent to Kazakhstan and Germany.
A halt to Kazakh flows would add more uncertainty to Germany’s fuel supply as the Iran war disrupts energy shipments from the Middle East only a few years after Berlin’s decades-long energy ties with Russia were upended by the war in Ukraine.
Kazakhstan’s oil exports to Germany via Russia’s Druzhba pipeline totalled 2.146 million metric tons, or around 43,000 barrels per day, in 2025, an increase of 44% from 2024, and 730,000 tons in the first quarter of 2026.
A complete halt would remove about 17% of the up to 12 million metric tons of oil a year processed by Germany’s PCK refinery – one of the country’s largest – in the northeastern town of Schwedt, fuel from which powers 9 out of 10 cars in the Berlin and Brandenburg region.
Russia’s energy ministry did not immediately reply to a request for comment. Kremlin spokesman Dmitry Peskov said he was not aware of a move to stop the oil exports.
“We will try to check it,” Peskov told reporters on a daily conference call.
Kazakhstan’s energy ministry and the German government did not immediately respond to requests for comment.
ENERGY TIES UPENDED
Russia’s political and business relations with Germany have been frayed by the conflict in Ukraine. Deliveries of Russian oil were halted after the start of the war and Berlin placed the local units of Russia’s largest oil producer Rosneft under trusteeship in 2022.
Kazakhstan has supplied oil to PCK via the northern spur of Druzhba, which traverses Poland, since 2023 but supplies have been repeatedly interrupted by Ukrainian drone attacks on the Russian section of the pipeline.
A spokesman for Poland’s pipeline operator PERN told Reuters the company is ready to ship oil for non-Russian shareholders of PCK via the port of Gdansk if asked to. Schwedt refinery holders include Rosneft, Shell and Eni.
(Reporting by Gleb Bryanski; Additional reporting by Dmitry Antonov in Moscow and Marek Strzelecki in Warsaw;Writing by Vladimir Soldatkin; Editing by Jason Neely and Kirsten Donovan)
[ Germany consumes 2,056,735 barrels per day (B/d) of oil as of the year 2024. ]
Hence a mere gesture as in change your warring policy, slap of hand ?
To be felt in and around the capital chiefly?
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The suggested amount of oilz to be deleted is on par of overall oil consumption in small industrialized Alpine/ClubMed country ala Slovenia with pop of 2M ( vs 83M GER )
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( for comparison ):
https://en.wikipedia.org/wiki/List_of_countries_by_oil_consumption
Germany is relatively far away from the North Sea oil, extracted by Scotland and Norway. It has been more dependent on Russian oil than European countries farther west. Cutting off 43,000 barrels of crude oil supply per day will push Germany down further.
It is so strange …. When I read mainstream media it sounds like no big deal. When the agreement is made the world can go back to normal and making money. No wonder investor guy is so confused when he comes here. I think if you haven’t been following Gail and others your perception is off…. Could we be wrong? I personally don’t know why oil is not at least $140
One of the possible answers is very ugly.. don’t read it further hah.
Basically, it depends on the over-all evaluation of the situation and fitting explanation grand theory for it. So, if you follow the theoretical option of very advanced multi-front/domain depletion as per today it simply means there has been so much of [ future demand brought to present ] that oil / energy prices CAN’T spike much under any imaginable horrendous duress. That’s why some oil-energy-policy analyst make the kiddie mistake when applying 1970s oil crisis metrics – according to them it should be now 3-6x worse hence $200-400 per barrel easily.. Well, apparently that has not and won’t happen under the grand theory of said advanced – terminal depletion of this civ version.. So, in practical terms we crossed the Rubicon and we will never revert to previous energy / material / food / .. opulence of the past. It’s a downhill motion from right now.. And in more granular detail, yes the ~2.5-3rd world goes down first ( as per Lagarde / Birol / .. ), but some industrialized outliers like SKorea would be in the early wave affected more severely as well..
I think the reason that the price of oil isn’t terribly high is because businesses and individual citizens cannot afford terribly high-cost oil. More young people are using bicycles and scooters to get around because they cannot afford automobiles. Airlines are going broke with the increases in jet fuel prices that have been announced. Many flights have already been cancelled.
There is an alternative to higher prices, and that is less usage. We are heading toward less usage.
Gail I think I remember you saying a while ago that the world cannot handle the price of oil over $80 for very long. I have seen a couple of comments/articles that demand destruction is already beginning.
I haven’t seen anyone comment on the fact that the oil coming through the straits is the good stuff, the high energy stuff. Cutting this off is a whole lot worse than loosing the low energy LNG oil being exported out of the states??
Sorry I meant NGL’s not LNG’s
I hope this helps in answering some questions .The breaking point for oil is here . According to the analysis the US admin will come under pressure to stop exports by July as domestic prices will go too high for political comfort .
https://www.hfir.com/p/wctw-the-oil-market-breaking-point-eab
If 1.5 mbpd of diesel is stopped from exports then we are in deep goo . High chance it could be first .$ 5+ effect is already showing .
Diesel is around $6.60/gal here in Oregon and gasoline $5.
Well, the issue is that you in Oregon can ” run into hillz ” fix there something up w.out or with just few gallons of fuel and have ample food next season, which is kind of impossible to do in most of India..
It is easy to make a decree that bans too much.
It makes perfect sense to ban at least some product exports, starting in July, or even sooner. Natural gas liquids are considered “products.” We have far more of these than we need. We should continue to offload them to countries that can use them.
We also export some product to use as diluent for their oil sands oil, so that it will flow through pipelines. This should be exempt because it is necessary. The diluent is extracted and reused, so it is not really exported.
There are also details on the crude oil that should be exported. Much of our oil is too light for our refineries and our end-product needs. This is especially true of the oil from shale.
If we ban too much exports, we run the risk of having to stop production of the oil we badly need because the system is being overwhelmed with volumes of “products” that our system is not set up for making use of.
Of course, if we stop getting imported steel pipes from China, we will likely have to cut back greatly on drilling anyhow.
Reante-
If only a modern rebel-reactionary Johnny Hempleseed would crop dust a load of male pollen onto all those lonely ladies from Willamette to Applegate maybe the average Oregoon would snap out from their Amnesia Haze and by miracle of transesterification produce biodiesel for the booming filbert (hazelnut) industry so that we don’t have to rely on imports from Turkey.
People assume that the oil from the Gulf is the “good stuff,” but I think this understanding is flawed. They believe EROEI models that do not include total costs of production, including necessary taxes. They do not realize that the Middle Eastern oil wells are mostly very old. They are reaching depletion, too. The wells start producing more and more water, relative to the oil produced.
People are taken in by the ridiculous “reserve” amounts that Middle Eastern countries have been publishing for years. These need to be understood as wishful thinking. Oil stops being produced when the price of oil falls too low for the countries producing it. With the large dependent populations in Middle Eastern countries, tax levels need to be high to cover the cost of imported food. If there is less food available worldwide, food importers will be in terrible shape.
Back in 2005, Matt Simmons wrote, Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy. He was early in his timing, but the point is still there. Many people have been depending way too much on permanent oil from the Middle East. Their wells “water out,” just as other wells do. If prices are very high, perhaps new techniques can get out more. But with low oil prices, the Middle East is as vulnerable as anywhere else.
Middle Eastern oil tends to be on the heavier side, so it yields quite a bit of diesel and jet fuel. In this sense, it is very good oil. Also, if populations in these countries should fall, it is possible that lower extraction prices might be acceptable.
Thank you Gail! Depletion is reality. Every thing else is theatre.
Actually the Non-Public Degrowth Agenda controls the depletion dynamics. Has done for 7 years now. The DA is the reality and everything else including depletion is the theater
If civilization is a managed agricultural system — which of course it is by definition — then managed depletion is no longer a geological phenomenon. It’s a managed phenomenon (“play”) no different from how surfing is a managed phenomenon (“play”) of climate dynamics.
That’s deep huh?
Let’s get us some more Robert Wyatt lyrics:
“It’s so easy to look down from above (helicopter viii-shuuun)”
https://youtu.be/jVyDd-jmqHs
As I intimated, the ceasefire was the melodic bridge into a chorus of demand destruction.
Less usage is very hard for Americans as they have to drive large trucks to the grocery store
Agreed! They need to impress their neighbors.
Ursulaeists are not banning theirz trusty [ awd/4×4 ]..
South Korea braces for an end to modern life as we know it
State employees hit with driving ban as households limit electricity use to battle energy crisis
“Satellite photographs reveal a brightly illuminated South Korea – dominated by its sprawling capital Seoul, home to 26 million people – while to the north, a sea of blackness stretches for 250 miles to the Chinese border, interrupted only by a smudge of light from Pyongyang.
South Koreans have long regarded the image as evidence of their ultimate victory over the North and its belligerent leadership, and of the wider triumph of capitalism and democracy.
However, in a matter of weeks, the lights may also begin to go out in Seoul, Busan and other towns and cities across South Korea as a result of the Iran war.
The world’s 12th-largest economy has emerged as the frontline of the global energy crisis triggered by the conflict, with its oil reserves at risk of running dry even if Tehran reopens the Strait of Hormuz to tankers with immediate effect.
https://archive.ph/20260421070919/https://www.telegraph.co.uk/business/2026/04/20/south-korea-braces-for-an-end-to-modern-life-as-we-know-it/#selection-3493.0-3509.168
This is a worthwhile article. South Korea is at the forefront of oil shortages because it has so little of its own fossil fuels and is so dependent on oil and LNG from the Middle East.
The country has been experiencing the lowest birth rate in the world, suggesting that the country already has symptoms of overpopulation.
People are being told to bicycle instead of drive. They are also being told to use as little electricity as possible. Operate their clothes washers only on the weekends. It is not just oil that is in short supply; it is electricity, too.
the Hand rolled out Smart Meters across the developed world for a reason. Custom brownouts and rolling blackouts.
You are correct. A while back, our electrical company came and replaced our dumb meter with a smart meter that can read out usage from a distance and also cut off supply, if the electrical company desires.
Benefit of cheap batt. storage vs US income level ( while it la$ts x petroYuan or other next such scheme be it merely regional feudum ).
Then 20+yrs from now ~solved.
RT says that Iranian negotiators are arriving in Islamabad. It is logical to assume it is because Usrael wants to kill them. What for otherwise? I think Marandi is part of the group.
One has to wonder to what degree it is Iranian leadership not learning lessons versus pressure being applied by, for example, China, who has all sorts of leverage.
And after they get killed what is China going to say? sorry?
Yes, solly.
This is just 45 minutes ago .
Iran’s parliament speaker rejects talks amid US threats .
https://www.argusmedia.com/en/news-and-insights/latest-market-news/2816814-iran-s-parliament-speaker-rejects-talks-amid-us-threats
I will believe only when IRGC says so . Rest is just speculation .
Agree, it’s not true. The Iranians are mocking the US about it
https://www.tasnimnews.ir/en/news/2026/04/21/3571504/vance-has-headed-to-pakistan-five-times-in-past-days
We must remember that it’s the same old game(as the Iranians are happy to point out)
https://www.tasnimnews.ir/en/news/2026/04/21/3571482/us-government-media-surrounded-by-illusions
While we’re on the subject of BS, China has not been putting any pressure on Iran, mainly because they, unlike the west, understand that they can’t(Xi’s words should not be viewed as reported, that wasn’t the meaning at all).
I’m enjoying people trying to twist this huge embarrassing lose into a win(how trumpian), while ignoring where we were, compared to where we are now and all the lies they swallowed whole in between, but still refusing to see what’s staring them in the face.
When is Trump going to blow up all their bridges and has anyone told him that there are over 300,000 of them? Given US production and assuming that they can source the needed rare earths, it should be completed in around a thousand years.
Every kneejerk action and inevitable change of course, is seen as a weakness of position and thinking.
https://en.mehrnews.com/news/243849/Misreading-Tehran-Culture-history-and-collapse-of-coercion
Latest I see from Pakistan, no change
“We are making intensive efforts to persuade the Iranian leadership to participate in the second round of talks”
“Pakistan, as a mediator, is in constant contact with the Iranians and is working hard to pursue a path of diplomacy and dialogue”
Anyone know what time the ceasefire ceases?
What is the existential issue? Energy flow. Iran and USA are behavioral Ally’s in the extreme. Iran is ceasing energy transit with its actions. USA is ceasing energy transit with its actions. Motives are opaque. Actions are not.
A strange dance where both proclaim their wishes to be one thing and demonstrate the opposite with the other.
Do they even know what they are?
Both Iran and the USA are acting in the direction of cutting off energy flow. Yet the Maximum Power Principle indicates that if there are energy sources that are economically extractable, they will tend to be extracted. The system will gradually adapt to whatever energy and other energy resources are available. Thus, if a forest burns down, or if it is killed by an invasive insect, after a few years, new plants (often trees, but perhaps other species) will grow to take advantage of the sunlight, water, and other resources available.
Thus, if a shortage of diesel cuts off many of US exports, the US may be left with a large amount of natural gas liquids that it currently is exporting, that perhaps by decree, can no longer be exported. Somehow, businesses will figure out ways to make use of the natural gas liquids. They may not move heavy vehicles, but very light vehicles could be powered with them, for example.
That applies to this announced/supposed round of talks, but remember they went to the last round after they’ve had leadership assassinated twice during previous negotiations. They should have learned their lesson and so should have China. The heart surgeon may not be up to the task.
Some ” goals ” have been finally reached, namely creating that buffer zone in ~former southern Lebanon ( all bridges gone ), also Don publicly said Israel did not persuade him for the attack on Iran but BNS did. Plus there was notably further deterioration in RoW posturing against these two, like historically unprecedented. Plus wobbly economy and the upcoming Q3 elections.
Hence the chances for some kind of deal are very high.
Although it could take form of ever ongoing lower intensity skirmishes as various Iranian ~independent factions duke it out. So, the Hormuz throughput could be re-instated only partially in the near-mid term. But better than nothing, world will tend to adjust somehow..
One could just as easily say that it’s logical to assume that the American delegation’s plane will fall out of the sky in a plot twist.
ECB President Christine Lagarde warns of possible food rationing due to fertilizer disruptions in the Strait of Hormuz
https://x.com/i/trending/2046494887676375225
The end of more?
Yet official sources, including the search engine “A.I” (the elite themselves relaying their messages to their Indian servants) results claim there are no official degrowth policies.
That’s why it’s called the Non-Public Degrowth Agenda guest. It’s officially unofficial.
You appreciate humor! Nice. One of the few things we have.
It has been said somewhere by some people that a lot of economic growth is population growth and that you need more people to produce more output.
Although, officially, the elite deny this.
https://cis.org/Camarota/There-No-Evidence-Population-Growth-Drives-Capita-Economic-Growth-Developed-Economies
They favor immigration because without it there would no population growth, and labor shortages and other economic problems. Immigration allows for a low, controlled amount of growth that mostly goes towards raising up asset values.
Good point, the US govs policies in terms of tightening formerly lax immigration procedures is most likely not only about ( incoming crime wave nor politics in the Gulf ) – it’s also about the realization US econ on the whole can’t feed+ so many people to deemed avg standard ( plywood bungalow + clunker + supermarket chem. goodies + job + .. , ).
The high interest rates made borrowing money to pay for social programs unsustainable. Taxes have not been the primary source of funding for government spending for a long time. The U.S. government has been borrowing for decades.
Yes, that’s the point, as it is apparently not enough to soldier on as before even with this nice $1-2T bonus y/y..
According to the AI summary:
On April 20, ECB President Lagarde told the Association of German Banks that prolonged closures of the Strait of Hormuz – vital for one-third of global seaborne fertilizer trade – would shift from inflation to rationing, severely hitting economic growth.
One thing that greatly cut food waste in 2020 was closing restaurants and cafeterias, and forbidding big gatherings like wedding celebrations. These types of users tend to have more waste than that used at home, especially if food is in short supply. I would expect restrictions similar to 2020 before outright food rationing.
Wearing a COVID mask cuts waste too (‘cos you can’t eat through it).
Surely we just need more jabs rolled out to cull a bigger chunk of the useless eaters?
Another timely anthrax outbreak would suffice
and then an anthrax vaccine would be added to
the growing list of mandatory vaccines.
There’s got to be a limit as to how many vaccines
the human body can absorb in a monthly time-frame.
They say ‘Overloading the immune system is unlikely because vaccines use only a tiny fraction of the immune system’s capacity.’, That can’t be true. Some vaccines create a strong immune response, with fevers, chills, or other headaches. Taking a day off from work or school because the vaccine made you sick suggests a weakened form of one virus can potentially tax the immune system. Now, add two or three vaccines with a moderate to severe immune response on top of that and the possibility of overloading the immune system goes up.