Guest Post by Mario Nawful
The energy crisis could start breaking the global economy next year.
Saudi crude production has reportedly fallen to 6.24 million barrels per day, its lowest level since 1990.
And now one of the escape valves has come under attack.
The Houthis struck Saudi Arabia’s east-west pipeline, which allows oil to reach the Red Sea without passing through the Strait of Hormuz.
Martin Armstrong thinks the bigger problem is increasingly not crude oil itself.
It’s refined products.
Diesel has crossed $6 a gallon in the U.S., while Armstrong says shortages are already disrupting transportation elsewhere.
And diesel is where an energy crisis stops being something you watch on an oil chart.
Trucks need it. Ships need it. Agriculture needs it. Heating oil competes for the same barrel.
“When you’re talking about shortages in jet fuel, planes don’t fly.”
Armstrong’s model projects the conflict could stretch into 2028, with oil potentially reaching $200 a barrel in an extreme scenario. He expects the fuel shortage could become a genuine economic crisis as early as Q1 next year, alongside a broader global recession.
For now, much of America still experiences the war as higher prices.
Armstrong’s warning is that eventually it becomes something much less abstract:
Things stop moving.
Tweet
Continue reading...
[ H/T The Burning Platform ]
Saudi crude production has reportedly fallen to 6.24 million barrels per day, its lowest level since 1990.
And now one of the escape valves has come under attack.
The Houthis struck Saudi Arabia’s east-west pipeline, which allows oil to reach the Red Sea without passing through the Strait of Hormuz.
Martin Armstrong thinks the bigger problem is increasingly not crude oil itself.
It’s refined products.
Diesel has crossed $6 a gallon in the U.S., while Armstrong says shortages are already disrupting transportation elsewhere.
And diesel is where an energy crisis stops being something you watch on an oil chart.
Trucks need it. Ships need it. Agriculture needs it. Heating oil competes for the same barrel.
“When you’re talking about shortages in jet fuel, planes don’t fly.”
Armstrong’s model projects the conflict could stretch into 2028, with oil potentially reaching $200 a barrel in an extreme scenario. He expects the fuel shortage could become a genuine economic crisis as early as Q1 next year, alongside a broader global recession.
For now, much of America still experiences the war as higher prices.
Armstrong’s warning is that eventually it becomes something much less abstract:
Things stop moving.
The energy crisis could start breaking the global economy next year.
Saudi crude production has reportedly fallen to 6.24 million barrels per day, its lowest level since 1990.
And now one of the escape valves has come under attack.
The Houthis struck Saudi Arabia’s… pic.twitter.com/fU9Bb04cl8
— Mario Nawfal (@MarioNawfal) September 11, 2026
Tweet
Continue reading...
[ H/T The Burning Platform ]
