The oil price today makes me laugh. Seriously. The EIA report showed that imports were down 416,000 bbls/d over the last 7 days. 7 x 416 = 2.9 mmbo/d less week over week.

Inventories decreased by 4.4 mmbbl. So 1.5 mmbbl were drawn from inventory but overall product increased by 4.3 mmbbl when you look at distillate, gasoline and propane/polypropylene.

Refineries are running at 76% or capacity. There is 7.7 mmbo/d of surplus capacity from OPEC+. Iran is cheating. Iraq is cheating. Libya is ready to come back on. But fear not … oil is up 4%. Makes perfect sense.

The bottom line. Markets are irrational. They trade on algorithms and sentiment day to day. But don’t be fooled. Oil, unlike Tesla, will trade on fundamentals and those fundamentals are awful for the foreseeable future.

#hottakeoftheday