Oil Markets Are In Deficit, But Not Shortage, Sen Says

Summary

Amrita Sen of Energy Aspects discusses oil markets that are in a massive deficit but not yet in a shortage, with inventories being drawn down. She warns that complacency about the Strait of Hormuz reopening could lead to a sharp price spike when refiners come to market, and expects crude prices could reach $160-$170.

• Oil market in massive deficit but not shortage yet.
• Inventories being drawn down, with tank bottoms approaching in some regions.
• Strait of Hormuz reopening postponed, causing supply uncertainty.
• Refiners are underbought and will scramble for supply.
• Potential for crude price spike to $160-$170.
• Financial market liquidity is thin, physical market may diverge.
• China has ample stocks, but US and Asia face shortages.
• End of June likely inflection point.