larry johnson gives us scott bessent taking charge, but failing according to larry;

 

 Scott Bessent says he doesn’t understand why oil is going up. On Thursday, hours after announcing that Washington would keep its naval blockade and hit Iran with the toughest sanctions in history, the Treasury Secretary watched crude climb and told CNBC, “I’m not sure why oil has popped up on this.” He called it a spike he doesn’t understand, and waved it off as noise. Buried in the bafflement is a remarkable assumption: that slapping draconian sanctions on a major oil producer should make oil cheaper. By Friday Brent was near $94, a second straight weekly gain above 5 percent, with Trump promising an “economic D-Day” on Monday.

There is no mystery. This is a Treasury Secretary watching the wrong gauge. Oil is not priced off sanctions announcements; it is priced off barrels reaching refineries. And the barrels stopped arriving in the quantities the world needs — not this week, but as the inevitable result of a strait that has been shut since February. The only puzzle is why it took until August to bite. The answer is that for five months, the shortage was hidden. Break the supply picture since the February 28 attack into three phases and the “mystery” dissolves.

Phase 1 — the oil already at sea (February 28 to early April)
When Hormuz seized up, the oil that fed the world for the next five weeks was already floating toward it. Tankers loaded before the attack kept discharging on schedule, and the in-transit pipeline — millions of barrels between the Gulf and its buyers — emptied onto docks as if nothing had happened. Futures traders saw what was coming and panicked early: WTI leapt from about $67 on February 27 to nearly $99 by March 13, a 47 percent spike in two weeks. But the barrels on the water kept landing, the feared scarcity didn’t show up at the refinery gate, and by early April the last pre-war cargoes had delivered. Then a second cushion arrived.........more...........