alt Hacker NewsI imagine pretty slowly because it's not just the US drawing down their reserves but every country, and everyone is going to want to replenish it at the same time.
I imagine pretty slowly because it's not just the US drawing down their reserves but every country, and everyone is going to want to replenish it at the same time.
Indeed. The global production was closely aligned with consumption. Even if everything became normal tomorrow, there just isn’t enough slack capacity to make up for the loss over anything but years.
The Strait was moving 20M bpd. Say with some over production and clever rerouting, the world was only at a 10M bpd deficit. This has been happening for six months now or 180x10M bpd = 1800M barrels that were never taken out of the ground.
Which is to say, you would need the world production to over produce by 10M bpd from previous levels for six months just to break even. That is not feasible. After this crisis, I suspect many governments will wish their SPRs were larger.