What is oil?

Oil speculators sold into the latest price rally, cutting 13,000 contracts and dropping their positioning score to just 12, suggesting the move is driven by fundamentals not speculation.

“As of the latest report, large speculators actually sold into the rally, cutting another 13,000 contracts. And their positioning score, it's down to just 12 points. Think about that. Price surging and the specs are leaving, which means this move is running on fundamentals.”

China shifted 1.4 million barrels per day of oil demand to EVs and cut total oil demand by 3 to 4 million barrels per day in H1 2026.

“In the first half of 26 alone they shifted 1.4 million barrels a day of demand for oil to EVs. They reduced demand overall for by 3 to 4 million barrels a day.”

The war-on macro pattern has reversed: rates, oil, and gold now all rise together during escalation, breaking from the pattern of the prior five months.

“War on, rates up, oil up, gold up. That's different versus the past five months.”

Existing fossil fuel fields already contain enough carbon to push warming well past 2 degrees C, making new production unnecessary and the case for an immediate production peak urgent.

“We already have enough oil, gas and coal underproduction on the surface of the planet or fields that are that are being used to take us well past two degrees.”

Expanding US LNG export terminals will gradually globalize domestic natural gas prices, eroding the cost advantage that cheap trapped US gas currently provides to power generators.

“As we build more LNG terminals and natural gas becomes a bit more like oil a commodity, a worldwide commodity, as opposed to trapped gas in the US, then the price of natural gas will rise.”

Jack Farley frames Japan's yield-curve-control episode, visible through hard assets priced in yen, as the clearest available roadmap for how U.S. financial repression resolves into hard-asset inflation.

“If you want to know how this ends, go price gold, oil, and anything else that's a hard asset in yen because this is the playbook.”

Jack Farley on how to read the Japan yield-curve-control playbook as a template for current U.S. policy outcomes.

“If you want to know how this ends, go price gold, oil, and anything else that's a hard asset in yen because this is the playbook.”

Real world assets (oil, gold, pre-IPO stocks) now account for over 60% of perpetual market volume, outpacing crypto perpetuals.

“One thing we're observing is that real world asset pers are actually dominating volume over cryptos. Per I think it's something over 60% of the volume of the per market is now looking at real world assets like oil, gold and now also these preipo stocks as well.”

Real world asset perpetuals, not crypto perpetuals, are driving the majority of perpetual market volume, challenging the assumption that crypto is the dominant use case.

“One thing we're observing is that real world asset pers are actually dominating volume over cryptos. Per I think it's something over 60% of the volume of the per market is now looking at real world assets like oil, gold and now also these preipo stocks as well.”

Using a gold price floor of $4,000 per ounce and the historical gold-oil ratio, Howell calculates a target oil price of $135 per barrel.

“We still get an oil price of $135 a barrel so substantially above where we are now.”