You sounded a little bit doubtful when I spoke to you earlier.

If they, in fact, go through with this, how long lasting will the impact be?

Good morning. Great question and great place to start.

So let's do the maths. The report so far is that the IEA is

planning the biggest ever release and the number out there is it would be

somewhere north of 180 million barrels. What we have lost more than ten days of

war, very easy calculation, about 20 million barrels per day that flows

through the Strait of Hormuz. We are now past ten days of the war.

The market has already lost about 200 million barrels.

Give or take. If the IEA countries release that much

of oil and a separate question over what period of time they will be able to

release or start. That would simply make up what the

market has already lost. Then every single day after that, that

the war continues and the strait remains closed.

What do we do? If you take a look at how long this

conflict has gone for, the impact across the Gulf states, across suppliers, that

is, how do you do modeling in terms of how much worse it can get and what

alternatives there are to, you know, being able to get around using the

Strait of Hormuz. You know, this black swan event, if I

can call it that, has already gone past all modelling.

You can't there's the obviously the the warfare

with the missiles and drones and what's going on in the Strait of Hormuz.

Right. So on the ground and physical market

disruptions that the likes of which the markets have never seen before in terms

of the enormity, 20% of the oil supply simply getting cut off.

But now this war has become even more complex and layered.

The last few days, what I'm seeing is it's become a psychological warfare.

It's become an information warfare. And just information warfare is what

don't even, you know, completely describe it, because we are seeing, you

know, as overnight we had the energy secretary in the U.S.

putting out an exposed that a tanker had been escorted safely out of the Strait

of Hormuz and then retracting it. And the U.S.

press secretary, the White House press secretary, then saying that that was

false information. So, you know, we are absolutely in

uncharted territory here. And I don't know what relief valves in

the IEA release. Let's see what that does, maybe some

psychological impact. But in the physical space and the

physical markets, it's absolutely chaos and mayhem.

You talk about the psychological and information warfare.

Say, though, if this war comes to an end tomorrow, I wonder what is your sense of

the extent in which production can be brought back quickly, given the damage

we've already been seeing to producing infrastructure?

Yes. So I think we would also need to very

clearly define and agree on a definition of what an end to the war means.

Right. The market view has been that President

Trump declares victory, The war is over, but we forget that there are still other

sides in this war. There's there's Israel, which said, I

believe on the same day that Trump said the war is is going to be over very

soon. Prime Minister Netanyahu said that

Israel is not finished yet. So we need to keep that in mind.

What plans and strategy does Tehran have?

We don't know that. So I think it would be very careful in

calling in, you know, describing what is an end to the war.

You would need absolute certainty for a period of time in the markets and on the

ground in the Strait of Hormuz that there's going to be no more

threats from drones and and missiles and debris or or even mines, for that

matter, played by anyone.

For ships to actually start going back and forth through the strait and for the

20 million barrels per day to start flowing into the market.

So, you know, the end doesn't look as clear to my mind as, you know, one would

hope it would. And at the same time, is the war

worsening the problem that we've had of dock fleets?

I mean, this idea that the U.S. is allowing Indian refiners to take

Russian energy, I'm sanctioning them. I mean, how does this shift the picture?

That's a drop in the bucket. India could take potentially, I don't

know, 10 to 20 million barrels of Russian oil that has been floating and

stranded, if you will, because of sanctions of the parties involved or

sanctions on the on the vessels involved.

Again, let's be very clear. The U.S.

has not lifted, even temporarily lifted sanctions on Russia.

What it has done is given a very limited waiver for one month.

India can buy oil that was already on water as of the 5th of March.

So a very, very small relief valve does almost nothing to address this huge job

calls that we have in the strait. Now,

I don't know where do you see the biggest vulnerabilities in economies

across Asia? Where do I start?

So already we see the ripple effect going through all the way into

petrochemicals and every single product around us that we consume

that uses petrochemicals. And, you know, the

every day I'm seeing at least a half a dozen to even a dozen companies

declaring force majeure on on product supply.

These are petrochemical companies. So it has already percolated all the way

down to that part of the oil supply chain that,

you know, as is the closest to consumers.

And, you know, you earlier asked me what if when the war ends, I would say that

this supply chain disruption has taken on such gigantic proportions now that

even a complete end to the war and a complete return to normalcy, I fear,

would mean at least months before we return to anything resembling normalcy

in in oil supplies and refining and petrochemicals and all the goods that we

consume on a daily basis. So we are headed for a period of

elevated oil prices that could be extended, protracted.

I wonder what is your sense of how high things can go?

120 I mean, based on what you're saying, maybe that's not even the lid.

Well, at this point, we are in this very curious and unfortunate situation.

I would say that the prices that we are seeing on crude futures are simply

completely disconnected from ground realities if you need to and if you have

to lift a physical barrier, which is well, which is how the world functions.

Right. Not on the basis of futures, but the

physical barrels you are having to pay 20, 30, $40 more than where the futures

are trading. So when you ask me where will prices go,

it's really hard to say. So which prices should we talk about?

But but I would leave it at this that, you know, how how much longer the Strait

of Hormuz remains closed. So the IEA may provide some relief, very

small temporary relief. I would say at the end of the day, the

Strait of Hormuz needs to reopen, or at least in the physical market, physical

oil prices will remain and continue going up in triple digit territory.

Just forget about what you are seeing on your screens with regard to the futures.