High oil prioces men lower dollar means higher ten year rate

Big Freeze in Texas Is Becoming a Global Oil Market Crisis

What began as a power issue for a handful of U.S. states is rippling into a shock for the world’s oil market.

More than 4 million barrels a day of output -- almost 40% of the nation’s crude production -- is now offline, according to traders and executives. One of the world’s biggest oil refining centers has seen output drastically cut back. The waterways that help U.S. oil flow to the rest of the world have been disrupted for much of the week.

“The market is underestimating the amount of oil production lost in Texas due to the bad weather,” said Ben Luckock, co-head of oil trading at commodity giant Trafigura Group.

Brent crude briefly surged above $65 a barrel on Thursday, a level not seen since last January. Spreads indicating supply tightness also soared. Ten months ago, the price slumped below $16 because of a demand shock caused by Covid-19.

The price and supply are determined in a monopoly because the petrodollar is managed in Japan. There is a reason the Yen is a carry trade.  The only job the Fed has is tax collection, and quite illegally I might add.

When the Japanese raise FX insurance, dollar holders must buy oil and store it. I works just like the gold standard. What do we know about commodity standards? There is little inflation.