Tag: oil

The Biggest Winners And Losers From The Petrodollar’s Decline

The Iran war is straining US weapons stockpiles and raising doubts about Washington’s ability to protect the Persian Gulf.

If that weakens the petrodollar and pushes oil producers away from the US financial system, two assets face clear headwinds: the US dollar and US Treasuries.

The petrodollar system helped create structural demand for both.

If oil exporters sell more energy outside the dollar system, fewer oil dollars need to flow back through Wall Street and into Treasury securities.

At the same time, the US government needs to borrow staggering sums to finance its deficits, military commitments, entitlement programs, and interest expense.

That means rising supply of Treasuries could collide with weakening structural demand.

Watch the 10-year Treasury yield.

The 10-year Treasury yield is perhaps the most important financial benchmark in the global fiat system, as it drives valuations and market trends worldwide. It is widely – and erroneously – regarded as the risk-free rate of return.

The 10-year Treasury yield can be thought of as a key barometer of the US dollar-based fiat system – a critical measure akin to its beating heart.

Bond yields move inversely to bond prices. When bond prices fall, bond yields rise.

A rising 10-year Treasury yield signals trouble for the US dollar because it means investors are selling Treasuries, which pushes up the US government’s borrowing costs. That is why the 10-year Treasury yield is a major pain point for the US government.

The 10-year Treasury yield was 3.97% in late February 2026. Now it is around 5.26%, an increase of roughly 129 basis points. 129 bps might not seem like much, but with over $40 trillion in debt and growing, every basis point matters.

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Western Media Accept Trump’s Plundering of Venezuelan Oil as Business as Usual

Since the January 3, 2026, military strikes and kidnapping of President Nicolás Maduro, the Trump administration has imposed semi-colonial rule over Venezuela, forcing dramatic shifts in the country’s domestic and foreign policies.

The capstone of the new tutelary regime is an oil deal announced in late August that Trump called “the biggest in history.” The agreement turns over 17 prime oilfields, holding over 20% of the country’s reserves, to a Pentagon-controlled corporation tasked with supplying cheap fuel to the US war machine for decades to come.

After spending years manufacturing consent for US-sponsored regime change in Venezuela (e.g., FAIR.org, 6/4/21, 1/11/23, 2/12/25), having a government in Caracas subservient to Washington represented a new scenario for the corporate media. The novel conditions have raised few significant qualms for Western outlets. Tactical objections notwithstanding, there is no fundamental disagreement with the US running the affairs of a Global South country.

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Record Tanker Rates Leave Heavy Crude Stranded In The Americas

The Middle East crisis has driven tanker rates to all-time highs and created a shortage of vessels. This oil logistics problem is now causing a ripple effect, tipping the heavy crude market in North and South America into oversupply – while Asia and Europe grapple with a shortage of heavy grades.

Canada is producing over 5 million barrels of crude daily, most of it heavy crude. Some 4 million barrels daily of that goes south to U.S. refineries. Venezuelan production has also moved higher after the U.S. disposed of the country’s government and took control of the oil industry. According to Reuters, a lot of this heavy crude is stuck at home because of the record freight costs that have dampened appetite, pressuring prices in Canada, Colombia, and Ecuador. Venezuelan crude goes mostly to the U.S. Gulf Coast, so it is not as vulnerable to freight rate developments.

Prices for Canadian, Colombia, and Ecuadorian heavy crude have all shed some $10 per barrel in recent weeks, the report said, citing Argus data. All the flagship grades are now trading at the lowest in six weeks, with Western Canadian Select reaching $74 per barrel last week, before rebounding to $79.50 at the time of writing.

Ecuador’s flagship heavy crude grade, Oriente, has also recovered, after dropping to $76 per barrel last week, now trading at over 84 per barrel. Colombia’s Vasconia was the most expensive of the three last week, trading at $84 per barrel, and it has also probably gone up this week, as all oil gains on the flurry of tanker attacks in the Strait of Hormuz.

These prices cited above seem quite enticing on a market where Russian Urals fetches close to $120 per barrel, and Iran Light sells for $104 per barrel, despite the U.S. Navy blockade. However, these prices exclude freight costs and insurance, and these have reached up to $40 per barrel of crude, at a time when heavy crude is in especially strong demand because of the global diesel crunch. Heavy crude yields more diesel than lighter grades, which is quite a hot topic right now.

“You need a ship and the price of ships are going up, and the availability ships are going down,” TP ICAP analyst Scott Shelton told Reuters. Global tanker rates have soared this year due to Middle Eastern producers taking to ship-to-ship transfers outside the Strait of Hormuz. For this, they use shuttle tankers, including smaller carriers, to sneak the oil through Hormuz and then load it on supertankers in the Gulf of Oman. As a result, supertanker rates from the Gulf to Asia hit $1.4 million daily earlier this month.

Shipping costs on the route from the U.S. Gulf Coast to Europe, meanwhile, have surged to $46 million in total, equal to $24.50 per barrel of crude. That compares to $6.5 million, or some $4 per barrel, before the war. The price is even higher on the route from the Americas to Asia, at over $80 million or $40 per barrel. It is little wonder why refiners in Europe and Asia are balking at the price and staying away from purchases.

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The Sheer Ignorance Of What’s At Stake Globally

This is a textbook case of how someone can reach the top of one field and still be utterly clueless about everything else. Lt. Gen. Keith Kellogg served as National Security Advisor to former Vice President Mike Pence and later as Special Envoy for Ukraine and Russia. He is Co-Chair at the Center for American Security, America First Policy Institute, USA, which is a Neocon think tank. The man’s ignorance is staggering. He has made no effort to examine the facts—or, more likely, he knows them and deliberately refuses to discuss how Victoria Nuland helped select the interim government that started this civil war and attacked the Donbas on Neocon orders.

He advocates that Zelensky should tell President Trump to go to hell and destroy every refinery in Russia. To illustrate his sheer stupidity: forget the food crisis he would cause in Russia, knowing that would lead to nuclear war—he completely ignores that Africa and the Middle East account for over 80% of Russia’s wheat exports, making those regions the most directly tied to Russian grain. Iran is 100% dependent on Russian grain. That would be a surefire way to make the Middle East explode into a full-blown war, which would then merge with the Russia-versus-EU war, and China and North Korea would join.

It is these Neocons, who simply hate the Russian people, who are cascading the world into World War III over a war they instigated using Ukraine. He would fulfill our model by pushing diesel to the extreme, projecting $8, which would hit the U.S. economy, reduce trucking, and result in a U.S. food shortage. This is what I mean. Expertise in one field does not qualify you to argue about things that will impact the rest of the entire world with zero comprehension of where that leads.

A full-scale war with Russia would very likely cause a severe global diesel crisis, and in many regions, a collapse in supply is a real possibility. The system is already under extreme strain, and a broader conflict would push it past its breaking point. Our computer projects $10+ a gallon by 2032.

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Kallas & Zelensky Cannot Sleep as Long As One Russian is Still Breathing

For whatever it’s worth, it seems diesel fuel and heating oil are set to climb, with a final peak next March. A cold winter could speed that up, but Ukraine has already inflicted massive damage on Russia’s refineries. Diesel has a dramatic impact on food. In Asia, ships need diesel to transport food back, and farmers can’t harvest their crops without it. Trump is right that Zelensky is affecting the entire world, and Zelensky has openly said he doesn’t give a damn. Even worse, all the critics pushing for World War III insist Trump shouldn’t lift any sanctions on Russia. They won’t be satisfied until there’s a nuclear war.

In the case of wheat, we had a Directional Change in 2025 and that has been correct. A close at year end simply above 645 when we are currently at the 670 area is projecting a serious risk of a rally into 2030. Between Zelensky and Netanyahu, this dynamic-duo is really screwing the entire world and then we have ruthless Neocons, include Kaja Kallas in Europe, who cannot sleep at night as long as one Russian is still alive.

Even the Ukrainian government-controlled press states that they will NOT honor any ceasefire on energy. What if the EU were supplying Carney in Canada to wage war against the United States with 80,000 drones—who is the enemy? Canada, which launches the drones, or the country providing them? In law, if you hire someone to kill your spouse, you cannot claim innocence on the grounds that you didn’t pull the trigger. The UK has supplied over 80,000 drones to Zelensky, orchestrated by Boris Johnson, who has intervened to ensure Zelensky does not agree to peace.

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Global Oil Shipments Under Pressure as Supertanker Supplies Tighten

A shortage of available supertankers is raising global oil shipping costs and making some long-distance crude trades uneconomical, according to shipbrokers, traders and industry data cited in a Sept. 19 report. The squeeze arrives as fuel markets remain tight and the geopolitical conflict around the Strait of Hormuz continues to disrupt seaborne energy flows.

Moving a cargo from Houston to Asia now adds about $26 a barrel, or $52 million a cargo, the report stated, equal to roughly a quarter of the price of West Texas Intermediate futures. That figure represents a cost that traders say can erase the profit margin on a long-haul voyage.

Oil tanker rates have jumped to record highs as escalating risks to shipping in and out of the Middle East prompt traders and tanker operators to undertake inefficient and more expensive trade routes, according to Tsvetana Paraskova of OilPrice.com [1]. The report stated that the cost increase threatens long-haul flows as fuel markets remain tight.

Freight Rates Reach Record Levels on Key Routes

Very large crude carriers hauling 2 million barrels from the Persian Gulf to China are earning upward of $1.2 million a day, according to industry benchmarks. Earnings on the benchmark Saudi Arabia-to-China supertanker route surged to a record $647,000 per day on Thursday, according to Baltic Exchange data cited by Bloomberg, more than ten times the rate a year ago [2].

Supertanker owners were getting paid $510,000 per day on some Gulf routes in August, according to Middle East Eye [3].

Suezmax earnings average more than $300,000 a day, rates typically associated with war-zone voyages, traders and shipbrokers said [10]. Ship-tracking data from Vortexa show U.S.-Asia flows have fallen in recent weeks as freight costs roughly tripled, the report stated.

Conflict and Fleet Stretching Drive Supertanker Squeeze

Industry executives and shipbrokers said they have never seen supertanker availability so tight, with few vessels available for hire in some locations. The main drivers are the knock-on effects of the U.S.-Iran conflict and a large wager by a South Korean tycoon that had already lifted shipping rates before the war, according to the report [10].

Vessels shuttling through the strait are switching cargoes near Oman, while other tankers sail around Africa to pick up Mediterranean cargoes, stretching the fleet, the report stated. Offshore Oman, 16 tankers clustered together to transfer millions of barrels of oil that had been stranded in the Persian Gulf [5].

Saad Rahim, chief economist at Trafigura Group, said at the Bloomberg Commodity Investor Forum: “It has never been this expensive to move oil around.” The Iran war has turned very large crude carriers into assets earning more than $650,000 a day, with earnings on the benchmark route surging to a record [2].

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Oil Rises After MidEast Attacks Spread And Escalate, Stoking Supply Fears

Oil prices rose at this evening’s futures open after renewed escalation of attacks by Iran and its proxies in the Middle East.

WTI is pushing back up towards Friday’s highs.

This move comes as President Trump claims that Russia and Ukraine have agreed to an ‘energy ceasefire’ which may just stabilize diesel prices around the world, but does nothing for exponentially rising tanker rates and the tightness in the physical oil markets.

Treasury markets are closed Monday, silencing the one cross-asset signal that typically anchors risk sentiment – meaning there will be no (cash) bond market verdict on what this weekend of renewed and re-escalated violence wrought.

“In quieter conditions, geopolitical headlines can often have an outsized impact,” Nick Twidale, chief market analyst at AT Global Markets in Sydney, wrote in a note to clients. But with the US inflation reading, several central bank speakers and the start of another US earnings season this week, “there will be plenty for markets to digest,” he wrote.

Dramatic Videos Show Several Tankers On Fire In Strait Of Hormuz This Weekend

Yet another tanker has been struck in the Strait of Hormuz on Sunday, which brings the total number to at least two or possibly as many as three suffering damage in the last 24 hours, chiefly from sea mines.

A slew of videos showing tankers striking mines have emerged on social media over the weekend, at a moment attacks on international vessels by Iranian forces are surging to wartime highs…

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‘No More Pipelines’ law is unconstitutional: Alberta Court

Ottawa’s controversial “No More Pipelines” law has suffered another constitutional defeat, with Alberta’s highest court ruling 4–1 on Friday that the legislation still oversteps federal authority despite attempts to fix it.

“Yet another big win for Alberta,” Premier Danielle Smith declared Friday on social media.

The legislation, introduced through Bill C-69 in 2019, governs federal environmental assessments of major infrastructure and resource projects, including mines and pipelines.

The Alberta Court of Appeal first found the law unconstitutional in 2022. The Supreme Court of Canada largely agreed in a 5–2 ruling in 2023, rejecting its designated projects scheme while upholding provisions governing federal projects.

Ottawa amended the legislation in 2024, but Alberta challenged the changes, arguing they failed to address the Supreme Court’s concerns.

Friday’s ruling found that Ottawa could still use limited federal interests to regulate entire provincial projects, exceeding its constitutional authority. The majority also rejected using federal responsibilities toward Indigenous peoples to justify broader regulation.

Justice Kevin Feehan dissented, finding that Ottawa’s amendments sufficiently addressed the Supreme Court’s concerns.

Smith urged Prime Minister Mark Carney’s government to accept the ruling rather than pursue another appeal.

“The Alberta Court of Appeal just ruled that C-69 remains largely unconstitutional,” she said.

“I’m calling on the Federal Government to accept this ruling, refrain from yet another appeal, and immediately work with Alberta and the other provinces to clean up this flawed Trudeau-era legislation once and for all so it no longer inhibits economic development in our country.”

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Ukraine Reportedly Bombs Russian Oil Terminal Which is Part of Deal to Lower Price of Diesel to the US

The war machine extending the Ukrainian-Russian War is not our friend. They are doing everything to hurt President Trump and the US economy!

Ukraine Reportedly Bombs Russian Oil Terminal, Which is Part of Deal to Lower the Price of Diesel to the United States.

On Friday, President Trump announced that the price of diesel was coming down fast after he reached a deal with Ukraine on Truth Social.

I have just concluded a highly successful discussion with President Vladimir Putin, of Russia, wherein it was agreed that Russia will immediately supply over 300,000 Tons of Diesel Fuel to the American and Global Marketplace, another 500,000 Tons during the month of November, and 1,000,000 Tons immediately thereafter. Additionally, based on the condition of their Diesel Refineries, Russia will then deliver, within a short period of time, 3,000,000 Tons of Diesel Fuel. Between our TOTAL CONTROL of the Strait of Hormuz, and this great announcement on Russian Energy, Diesel Prices for Americans and, indeed, the World, will be COMING DOWN, IN RECORD NUMBERS, AND FAST! Lower prices for Americans, especially our Great Farmers, Ranchers, and Truckers, is my Greatest Priority. This is a very big and important announcement. Additionally, it must be understood, that Iran will not have a Nuclear Weapon! Thank you for your attention to this matter. President DONALD J. TRUMP

Overnight, a massive Russian terminal is bombed by Ukraine.  The following was reported:

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Trump strikes diesel deal with Putin in sharp reversal of US policy

President Donald Trump said he has struck a deal to obtain diesel from Russia, a stunning reversal of years of US pressure on Moscow over its war with Ukraine and an attempt to address high fuel prices ahead of the US midterm elections.

Trump said on social media on Saturday that he struck the deal with Russian President Vladimir Putin in a phone call in which he was expected to discuss a suspected case of plague in Russia. Instead, Trump announced that Russia will immediately supply more than 300,000 tonnes of diesel, followed by an additional 500,000 tonnes in November and 1 million tons “immediately thereafter”. Russia will deliver an additional 3 million tonnes “within a short period of time” after that, he wrote.

Trump’s shocking announcement was in stark contrast to a sweeping Russia sanctions law he signed last month that aimed at clamping down on the oil and gas revenues that fuel Russia’s war against Ukraine.

Ukrainian President Volodymyr Zelensky called it “a weak decision, unfortunately, a weak decision by strong partners”, according to a statement released by the Ukrainian Embassy in Washington.

Trump announced the deal as his envoy Steve Witkoff and son-in-law Jared Kushner were meeting with Ukrainian officials in Miami to discuss a proposal to end the Russia-Ukraine war.

“I believe our team is simply being used as a smokescreen. And that is certainly not fair. It is certainly not how partners should treat each other,” Zelensky said.

Trump’s move casts doubt on the likelihood of the White House imposing new sanctions on Russia, given that the law that passed overwhelmingly by Congress directs the administration to target countries that purchase Russian oil and gas. Lawmakers this week had urged the Trump administration to act quickly to use the tools available to help Ukraine.

Senate Democratic leader Chuck Schumer, along with Senator Jeanne Shaheen, who is the top Democrat on the Foreign Relations Committee, and Sen. Elizabeth Warren, the ranking Democrat on the Banking Committtee, called Trump’s announcement a betrayal of Ukraine, the European allies and US national security.

“Enough is enough,” the senators wrote. “The President must end his war with Iran instead of funding Russia’s war machine.”

Gas prices globally have surged as the war in Iran upends the energy sector. While diesel future prices dipped on the news on Saturday, the national average for a gallon of diesel in the US remained high at US$6.28 (NZ$11.19), according to AAA, after hitting a record US$6.52 (NZ$11.61) on September 22.

Trump did not address the sanctions or Russia’s war but said, “Lower prices for Americans, especially our Great Farmers, Ranchers, and Truckers, is my Greatest Priority”.

Trump said later as he left the White House for a campaign rally that he was thankful for the deal. “I want to thank President Putin. To be honest with you, we have massive amounts of oil coming into our country, and it’s diesel, which is what we want. So, thank you,” Trump said. He did not answer shouted questions about the criticism from Zelensky.

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