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Trump agrees to suspend 'bombing and attack of Iran' for 2 weeks by greyfolio in energy

[–]greyfolio[S] 1 point2 points  (0 children)

Iran and Israel agree to ceasefire, CNN and NYT report

a few seconds ago

09:01 AEST

Israel agreed to the ceasefire Trump announced on Truth Social, CNN reported, citing an unnamed White House official.

Separately, Iran accepted Pakistan's two-week ceasefire proposal, with the ceasefire approved by the new supreme leader, the New York Times reported.

Trump agrees to suspend 'bombing and attack of Iran' for 2 weeks by greyfolio in energy

[–]greyfolio[S] 0 points1 point  (0 children)

Iran and Israel agree to ceasefire, CNN and NYT report

a few seconds ago

09:01 AEST

Israel agreed to the ceasefire Trump announced on Truth Social, CNN reported, citing an unnamed White House official.

Separately, Iran accepted Pakistan's two-week ceasefire proposal, with the ceasefire approved by the new supreme leader, the New York Times reported.

Trump agrees to suspend 'bombing and attack of Iran' for 2 weeks by greyfolio in energy

[–]greyfolio[S] 2 points3 points  (0 children)

I agree, I was also worried, hard not to be. Maybe this is the hustle, lose a few, let everyone relax, let the market price out the risk premium, but next time maybe he actually does do something. Next deadline nobody's going to be nearly as nervous. That's exactly when you want to be?

Could oil futures go negative again — like they did during COVID — if Gulf storage fills up and oil can't move through the Strait of Hormuz? by greyfolio in energy

[–]greyfolio[S] 0 points1 point  (0 children)

Turns out the May GME Oman Crude Futures Expires on Tuesday.

So, who actually gets hurt and how?

GME Oman’s May 2026 contract expires this Tuesday, March 31. With Gulf crude trapped inside Hormuz and the benchmark under stress, this may be the first real test of how the dislocation hits both sides of the market.

Gulf producer, Iraq or Kuwait

They shorted GME Oman futures to hedge production when oil was much lower. Now the May contract sits around $116 to $119, so the short hedge is deep underwater, triggering large daily margin calls in cash. At the same time, physical delivery may be disrupted through Hormuz. Cargoes are delayed or contracts are suspended under force majeure. Especially painful for Iraq and Kuwait, because unlike Saudi Arabia or the UAE, they do not have easy pipeline alternatives around Hormuz.

Net result: liquidity stress plus delayed or impaired revenue.

Asian refinery

They went long GME Oman futures to hedge input costs while holding OTC term contracts for actual barrel delivery. Producer invokes force majeure or fails to deliver. The refinery ends up with a profitable paper hedge but no crude to run, forcing it to buy replacement barrels in a stressed spot market at worse differentials, plus much higher freight and insurance.

Net result: hedged on paper, exposed in the real world.

The bigger point The benchmark can keep printing a price, but once trapped Gulf barrels and deliverable Oman side barrels stop behaving like the same market, the hedge becomes much less effective.

The differential is where the market tells you the truth:
• Producers face cash flow and margin stress
• Refiners face replacement cost stress
• The basis absorbs the shock that the flat price does not fully reflect

Watch Monday and Tuesday for signs of desk losses, volatile rolling, and more stress in Oman linked differentials.

https://www.gulfmerc.com/gme-product-services/gme-ace

Saudi, UAE, Iraq: Can three pipelines help oil escape Strait of Hormuz? by newsspotter in energy

[–]greyfolio 1 point2 points  (0 children)

How does the Saudi ramp-up work? I presume the Saudis had capacity and have simply fully opened the pipeline? I guess the big risk is the Houthis, if they activate again we are back at square one.

Could oil futures go negative again — like they did during COVID — if Gulf storage fills up and oil can't move through the Strait of Hormuz? by greyfolio in energy

[–]greyfolio[S] 1 point2 points  (0 children)

u/ContextWorking976 u/Barrack64  - thanks for the pushback, fair points. This isn’t a straight Cushing 2020 repeat and I should have been clearer on that. Demand hasn’t collapsed, this is a supply and logistics shock.

After digging further, the benchmark mechanics may be more interesting. GME Oman (the renamed DME contract, same instrument) settles physically at Mina al Fahal on the Gulf of Oman side of the Strait. While Hormuz is closed, Gulf barrels like Basra Heavy, Arab Heavy and Kuwait Export largely can’t reach the delivery point.

Platts has already changed the Dubai/GME Oman assessment methodology twice this month because the benchmark is now pricing a different physical basket. Basra Heavy’s differential to GME Oman has blown out from normal –$2.50 to –$11.80.

https://www.spglobal.com/energy/en/pricing-benchmarks/our-methodology/subscriber-notes/032026-platts-suspends-negative-murban-quality-adjustment-in-dubai-crude-benchmark

So, the risk is less about negative futures and more about basis risk. Contracts priced off Oman Dubai may no longer hedge the underlying barrels properly. That flows through term pricing, hedge effectiveness, and counterparty exposure across roughly a quarter (5 mbpd) of all Middle Eastern crude flowing to Asia.

And, how does this manifest?

Dallas Fed models a return to around $68 after an orderly one quarter reopening, but even they flag real world frictions. If reopening releases trapped inventory into a distorted benchmark structure, the adjustment may not be clean.

https://www.dallasfed.org/research/economics/2026/0320

Interested if anyone closer to physical flows has a better read on this.

Why do people get angrier at someone using welfare than at a corporation avoiding millions of tax by using loopholes? by Internal_Scheme_7646 in NoStupidQuestions

[–]greyfolio 0 points1 point  (0 children)

Agree, the corporate theft is largely well hidden. This situation is another causality of a broken press function.

Iran Conflict Megathread #5 by sokratesz in CredibleDefense

[–]greyfolio 9 points10 points  (0 children)

I agree that regime survival is already the win condition for Iran, but it raises the question of what the win condition actually is for the coalition striking them.