TFTC: A Bitcoin Podcast - #779: SPR Releases Fix Nothing with Anas Alhajji

Episode Date: August 3, 2026

Energy economist Anas Alhajji breaks down the Iran war's impact on global oil markets, Hormuz shipping risks, and diesel shortages driving inflation. He exposes demand destruction, SPR manipulation myths, and why LNG dominates the energy security chessboard. Alhajji reveals how sanctions, trade wars, and AI data centers are reshaping macro policy, commodity prices, and dollar hegemony. From Saudi export bottlenecks to European deindustrialization, this deep dive connects crude volatility to monetary policy, Bitcoin macro, and the national security case for natural gas. Anas on X: https://x.com/anasalhajji Anas’s Substack Daily: https://afalhajji.substack.com/ Weekly: https://anasalhajjieoa.substack.com/ Find the Home Mining Playbook here: https://www.tftc.io/home-mining-energy-playbook STACK SATS hat: https://tftcmerch.io/ Our newsletter: https://www.tftc.io/bitcoin-brief/ TFTC Elite (Ad-free & Discord): https://www.tftc.io/#/portal/signup/ Discord: https://discord.gg/yHGkvYxdqT Opportunity Cost Extension: https://www.opportunitycost.app/ Shoutout to our sponsors: Block: Cash App: For a limited time, new customers can get $21 added to their balance. Just use code TFTC10 when you sign up, and send at least $5 to a friend in the first two weeks. Terms apply. Bitcoin services by Block, Inc. See the Bitcoin disclosures at cash.app/legal/podcast. Square: Visit http://square.com/go/tftc for up to $200 off eligible Square hardware. Bitkey: Use code TFTC10 for 10% off the new Bitkey. Aven https://www.aven.com/bitcoin CrowdHealth https://www.joincrowdhealth.com/tftc Unchained https://unchained.com/tftc/ Salt of the Earth: https://drinksote.com/tftc Join the TFTC Movement: Main YT Channel https://www.youtube.com/c/TFTC21/videos Clips YT Channel https://www.youtube.com/channel/UCUQcW3jxfQfEUS8kqR5pJtQ Website https://tftc.io/ Newsletter tftc.io/bitcoin-brief/ Twitter https://twitter.com/tftc21 Instagram https://www.instagram.com/tftc.io/ Nostr https://primal.net/tftc Follow Marty Bent: Twitter https://twitter.com/martybent Nostr https://primal.net/martybent Newsletter https://tftc.io/martys-bent/ Podcast https://www.tftc.io/tag/podcasts/ Disclosure: Bitcoin services are provided by Block, Inc. Bitcoin services are not licensable activity in all U.S. states and territories, and not all services are available in all states. Bitkey is not available in New York. Block, Inc. operates in New York as Block of Delaware and is licensed to engage in virtual currency business activity by the New York State Department of Financial Services. Bitcoin is a non-deposit, non-bank product that is not FDIC insured and involves risk, including monetary loss. For additional information, see the Bitcoin disclosures: https://help.cash.app/btcdisclosures Get up to $200 off Square hardware when you sign up at http://square.com/go/tftc! #squarepartner. Offer expires December 31, 2026 at 11:59 pm PST. Offer for $40 off the cost of one Square Stand, $75 off the cost of one Square Terminal, $100 off the cost of one Square Handheld, or $200 off the cost of one Square Register, excluding applicable taxes. Limited to one discount per product type per seller account. Each code is limited to one redemption per account holder. Valid for new Square customers located in the US only. Offer not valid with guest checkout. Square reserves the right to modify, revoke or cancel the offer at any time. Offer cannot be combined with any other coupon. Void where prohibited, not redeemable for cash, and non-transferable. #squarepartner #blockpartner

You've had a dynamic where money's become freer than free. When you talk about a Fed just gone nuts, all the central banks going nuts. So it's all acting like safe haven. I believe that in a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. In the world of fiat currencies, Bitcoin is the victor. I mean, that's part of the bull case for Bitcoin. If you're not paying attention, you probably should be. Dr. Anas El-Hajji, welcome back to the show.

Thank you. Thank you. It's always a pleasure. It's been a while since you were last on, and you haven't been on since the war in Iran started. And I was rereading through the notes of our last recording, and it was when the saber rattling around Iran was really beginning to heat up. And last time we spoke, he called Iran's nuclear standoff the never-ending crisis and said sanctions cannot take Iran's exports anywhere close to zero. We're not looking at a conflict that appears to escape the narrow Iran-Israeli frame spread into arteries of the global energy trade. But before we go into price, just give us the map. It's obviously been evolving, started between the U.S., Israel and Iran in recent weeks. It looks like the Houthis in Yemen have entered the fray in the Red Sea.

There's been a memorandum of understanding, ceasefire on, off, on, off. Oil prices up above 100, down to low 70s, high 60s, back in the, I haven't checked today, but I imagine 80s or 90s. What is the map looking like today? Well, a couple of things before we look at the map, because there are some important issues that people must understand, that what we call the Iranian regime is not a unified regime. There are people who want to negotiate. There are people who are sincere and they want to build a country

and they want to build a nation. And there are the others who are after themselves. So there are elements of the IRGC, which is the Revolutionary Guard, who benefited greatly from the sanctions over the last three decades. And they literally make billions of dollars. And sanctions enable them to control the economy of Iraq and everything that comes in and out. So for them, a peaceful resolution basically will literally put them aside,

and they don't want that. So for the last 10 years or so, they've been trying really hard to derail any negotiations. and when you see their reaction and you see the attacks you can tell where the negotiations are going from the severity of their attacks

which means that the more severe the attack that means the negotiations were doing very well and they want to derail them and the issue right now is with those guys but the bigger issue is it just happened those guys who are now

gaining control in Tehran They are the international arm of the regime, which means that they are connected to the Houthis, they are connected to Hezbollah, they are connected to the others in Iraq and other places, even to the drug cartels in South America and other places. Those guys do not care about the future of Iran or building a nation. Those guys behave like drug cartels, exactly like drug cartels. Look how the drug cartels, for 80 years right now, the United States has been fighting them. Until now, they were not able to conquer them.

And they are awfully rich. They are well-trained. They have the most advanced kind of armors in the world. They have all kinds of weapons, and they fight. So those guys are behaving the same. So what is the problem? The problem is the U.S. is sending a regular army, a regular navy, trying to fight, in their thinking, a regular army and a regular navy, and that is not the case. you are sending a regular army to fight a guerrilla war or a militia and that does not add up that's

where one of the mistakes that's been done the other mistake basically being done by the trump administration is they fail to understand the motives because they thought oh well those guys are after building iran and the nation and therefore we can do this and we can do this and weekend. No, they are not after that. They are literally after control and money. And if you go for a peaceful resolution, that means you wipe out all their income sources. And that does not fit. And that's what the Trump administration has to understand. So the Trump administration being after them in the recent attack for 14 days, they've been after those guys. Notice that they did not kill any of the negotiating team.

They were after the extremists at the IRGC, and everything they've done, it seemed they did not do much simply because those guys are mobile. They keep moving. And that's why the whole structure of the war has to change to be able to make any advancement in the region. At the same time, again, this part of the regime is the international arm of it so they have people all around the world and that is another problem

and that forces the us government and others to think about another strategy on how to work the area and that and so let's get into the state of the area because obviously when the war started there was bombing on on both sides and i think one of the biggest fears in the first month was the degradation of the refinery infrastructure particularly in qatar with the natural gas refinery water salination plants potentially targets he had a bunch of pipelines and other refineries across the region that were taking on heavy damage and initial reports going to take years to build that capacity back now again like i said earlier it looks like the houthis are getting involved in the red sea beginning to bomb saudi tankers so

what is the the state of i guess the supply chain of oil and gas look like right now as a sandstone and obviously the straight through which uh before we answer before we answer this question we have to we have people have to answer the following question and this is kind of the answer to this will lead us to other questions do people believe that this war is about iran and it's a nuclear program or is it part of a larger change that is happening around the world that includes trade wars sanctions tariffs venezuela hanama canal china russia greenland in this part of the of of course you add ukraine and the european union to this uh north stream one north stream to. So is this part of that big picture or is just limited to Iran and nuclear program?

Once people understand that we have to make that distinction and then they get the answer, we can get other answers to the other questions because the whole issue at the end, if this is part of this global change, then everything fits. Because the United States forced Russia out of Europe, as you know. Russian share in natural gas market declined from 55 percent to 14 percent. And U.S. share in natural gas market in the EU increased from zero to 30 percent. now you look at asia qatar is not able to export lng to asia so what did they use two days ago qatar is going to import american lng to export it to asia instead of qatar so all of a sudden the u.s well again when you start asking those questions you start realizing

things are not what the media is telling us what people are telling us so you go back and look at what happened to north stream one and north stream two and to the how they shut down the ukrainian uh pipeline when the contract ended uh and and you look at how the us lng has become an integral part of u.s foreign policy and then you look at what happened in egypt Yesterday, in Egypt yesterday, we have an attack on LNG terminal and then two regasification units, both of them are American, by the way, got hit. And the question is why and who did that? And the Egyptian government refused basically to say more than it is. There were two drones and that's it.

And then the media start telling us, oh, it's 2,000 kilometers from Iran and 1,400 kilometers from Yemen. And they started kind of redirecting our attention into something that does not make any sense. OK, so Iran is sending a drone 2,000 kilometers and no one will know until they hit their targets. They crossed several countries, by the way. several countries and no it tells you that the whatever we are hearing from the media is just not not the right story i mean i can't stop thinking about the i think one thing that many people particularly the mainstream media aren't pulling into this is the national security strategy document that was written last year um by the trump administration and this is part of it

Basically, I don't want to kind of like sound like you're talking about conspiracy theory or anything else. I really would like to move to the energy markets and talk about the economics of it. But if you go back to the national security strategy that was released last November, it focuses on energy dominance and AI dominance. But you cannot have AI without energy. so everything boils down to energy dominance and the only way you can have energy dominance is to have the resources you don't have all the resources in the world so you control the US then and then indirectly control Canada and then directly or indirectly control Venezuela and now you want to direct to directly or indirectly control the energy sources in the

other side of the world well what's better than waterways look at what's happening in iraq today all of a sudden the company the russian company that was controlling one of the largest oil fields being kicked out u.s companies are taking over exxon mabo and chevron are returning to iraq here's the problem they already left iraq they are coming back to the same fields they asked them why did you leave because they said one two three four five six seven okay now you are back but one two three four five six seven still there nothing changed so what changed in your attitude until you want to go back to Iraq now and you look at other things a lot of there are more questions than what we even can ask questions in that alone answers I'm going to give you one

Last week, Lloyd of London informed shippers that if they pay Iran to pass Hermes Strait, they will cancel insurance. I mean, this is kind of like the FBI or the State Department or someone else will do that. Why they are doing the job of a foreign government? Why insurance company is threatening them? Because people were saying, oh, they canceled the insurance in the Gulf on March 1st, simply because risk is very high. Well, if it is about risk, paying Iran reduces risk. So why you cancel the insurance then? So this is one of them.

Then you add other things to the equation, which a lot of things do not make any sense out of this. We heard about the releases of the SPR. And we can discuss the issues of SPR and what did kind of the conspiracy about the SPR, etc. But you look at the SPR releases and you look at the impact. Supposedly, Trump wanted lower gasoline prices. But releasing oil from the SPR does not have any impact on gasoline prices, simply because our refineries are running at maximum. And if they are running at maximum, they cannot use more crude anyway. So it doesn't matter.

I heard some commentary on this. I mean, somebody was comparing Trump's draw of the SPR to Biden's. and the commentary i saw is that he was making a trade because if you look at where the oil price was when when trump was draining it he was trying to sell it sell it high to lock in i guess some profits or something like that and no they cannot this is okay i i have i've written a lot about this and i have a long video on this kind of a timeless video let me explain something about the SPR that is very important the release of Biden probably will end up the highlight of Biden presidency in a very positive way because if you go back and look at everything we've been told

even by analysts it's all wrong why it's all wrong because they told us oil prices will go to 250 dollars because of the sanctions on Russia and we were going to I was on your show basically and I said this at that time and I they said we are going to lose up to five million barrels remember that because of the sanctions and I said none and what happened we did not lose any Russian oil yet prices increased to 120 130 dollars and Biden released 211 million barrels 180 from the SPR as the Biden release plus the Congressional, the Congress mandated releases. There were 211. So if we did not lose the Russian oil and that 211 million being swallowed by the market,

how do you explain that? Everything the analysts told us about basically was completely off, completely wrong. So how does that compare to Trump's draw on the SPR? I will explain in a minute. But what happened is we were coming off the lockdowns and the demand was the increase in demand was massive. So what happened in 2022 was a repeat of 2007, 2008, where the demand outstripped supply, regardless of what happened in Russia. We did not lose Russian oil. It was demand that was extremely strong, and therefore the actions of Biden and I'm being completely apolitical here.

The actions of Biden basically at that time was one of the smartest moves of his presidency because otherwise prices would have gone above $200 and then destroy the world economy, destroy the U.S. economy. Now, you come to the Trump administration release. On daily basis, it is the largest release in history. So it's way higher than Biden. So in total, Biden release is larger,

but it's been done over a long period of time. With Trump, it's smaller in total, but on a daily basis, it's larger. And it has tremendous impact on the market simply because the amount is very large. The confusion we've gotten basically was about products versus crude. And that is really one of the main problems we have today. Throughout this crisis, after the initial period, let's say, so we start in April instead of starting in March, the crisis in the energy market was in the products, not in crude. So we have serious problems in the products market. And for your audience, I used this

analogy before, and I'm going to use it again here. I'm going to explain what happened in the diesel market, and you can apply it to any other market, but diesel, because we still have diesel crisis until today. And that's why I want to explain it to people. What happened in the initial period is after the insurance was canceled and ships were not able to leave, and then we started all those problems and the claims of blockades and the US blockades, etc. We have three major refineries in the Gulf. One in Kuwait, one in the UAE, and one in Saudi Arabia. None of them was able to export anything. So we lost their products.

And that created panic in the market. The problem is these are massive, some of the biggest refineries in the world. And we lost that. And the panic basically kind of took hold. As a result, governments around the world panicked, and they banned exports of petroleum products for fear of shortages. the method differ from country to country so china for example it was outright ban no export period and this is one of the reasons why it led to their decline in imports by the way

because now they don't need to import to re-export anyway india imposed taxes heavy taxes and south korea put a minimum said as long as you meet this minimum you can export above that or maximum whatever you want to call it so we started losing diesel from around the world as a result so we have the first effect then we have the secondary effect as a result here these are prices start going up again this applies to other products too this is just an example if you are a trader and physically you own diesel or crude or gasoline or just fuel or anything else and you know prices are going to go up next week and the margin between this week and next week is way higher than the cost of storage will you store sure so hoarding basically

started. So that made the situation even worse because of this. So because of these situations now, we have people panicking because they want the diesel. So India was, and this is a true example, India was selling a shipment of diesel to South Africa. The shipment was around East Africa, around Tanzania, Madagascar, and someone in Singapore bought it. Of course, they paid a higher price. So the ship got diverted. Now it's going to Singapore. Someone in China panicked.

Now they bought the same shipment and redirected it from Singapore to China. On the way to China, a Japanese company panicked. Now they took it to Japan. But that shipment should have been delivered to South Africa a week ago. now two weeks later and still in the ocean now take one ship and multiply it by hundreds probably thousands and you can see how the situation got exacerbated as if this is not enough we have Zelensky basically taking his time bombing the russian refineries and bombing the ships and the outlets and all the stuff and he he literally uh turned the uh 10 russia into an importing

country instead of exporting so in a sense we did not only lose the gasoline out of russia russia now is taking the gasoline out of the market out of india that's supposed to go to singapore so you put all of those together you can see you can see the impact but what What made the situation really scary right now is we have what I call right now the Four Seas Crisis. Until last week, it was the Three Seas. Now, after the attack on Egypt, it's the Four Seas. So we have the Gulf, we have the Red Sea, we have the Black Sea, and we have the Mediterranean Sea. We have problems in all of them.

And the question that needs to be answered is, now Kazakhstan exports stopped for the third time this month. Why Ukraine is halting the exports of Kazakhstan? Seriously, why the Trump administration is not saying a single word? We lost 1.4 million barrels a day. 1.4 million. During crisis when Bab el-Mandeb is semi-closed and Hormuz is semi-closed. And we lost 1.4 million. Not a single senator, not a single congressman said anything. And everyone is complaining about gasoline prices and diesel prices.

What the situation is really kind of once you start looking at it in a different way, you try to kind of like ask questions, say, OK, what is really going on? Why Zelensky is doing this over and over and over? You look at the media and the big accounts on Twitter and other social media accounts, they've been fooling us all along, whether intentionally or out of ignorance. So the Saudi refinery in Jazan was hit. There is no oil in Jazan, by the way. The whole area, the southwestern Saudi Arabia does not have any oil. All the oil, all the crude basically is far in the east. So this is a refinery.

That's it. So we did not lose that much oil because their refinery was hit. That's mostly domestic, and there are some product exports out of it. And then two days later, the gig was hit, which is an essential part of Aramco in the eastern province. And they accused an Iraqi group that is part of the Iranian regime. And as a result, the U.S. and Saudi Arabia bombed them the following day. But the amount of oil lost from Saudi Arabia was very, very limited. And the reason why, because you cannot kill the horse twice.

The Saudis cannot export from the east. They cannot export from the west. So whether their production goes up or down, it doesn't matter because they cannot export. During this time, we lost 1.4 million barrels a day out of Kazakhstan. That was a real loss. But the media and social media accounts kept talking about Saudi Arabia, and they ignored Kazakhstan completely, where the real loss was. And the question is why? Seriously, why?

And those analysts basically, why they are doing this? And during this period, of course, hundreds of videos were fake videos or old videos. So we have some big accounts, basically, literally when Gig was bombed three days ago. I can guarantee you that some of those guys never heard of it before. And because of the use of AI, because some of those accounts depend heavily on AI in their postings, they went to AI and said Gig, and the news is fresh. The AI has not collected the information yet. The only information exists from 2019 when a gig was hit, when we lost 5.5 million barrels a day.

And those guys basically were too young at that time to even know it existed. So they literally pulled the 2019. They start posting it as if it happened today. With the pictures, with all the announcements, with everything, we lost 5.5 million barrels. That was from 2019. so we we ended up with the the four seas crisis with all this misinformation and then we ended up with something i call the obsession crisis and this is related to what you guys do on on daily basis etc many of your followers basically do we know that the first

rule of investing is do not fall in love with your stock do not fall in love with whatever you are investing in but obsession leads to that law and we have people who get obsessed with the idea that all prices will go to 150 and talk about rent okay and they went on and on and on and on and on and and and it got so nasty that anyone will say no it's not going to go to 150 became the enemy but it was the result of that obsession and that obsession led to literally taking the social media fake news and promoting it because it fits with the obsession of 150 or 120 oil So in a sense, we got it from all sides. We have physical crisis on the ground, and we have a mental crisis.

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not only for those who are interested um and i will send you the link you can send it to them there is a part of the newsletter that is out of the paywall, so they can read it without paying. And that sums up, it's a very short, but sums up the whole situation. We are in deep trouble. Any way you look at it, we are in deep trouble. So if you look at the Saudi economy, the Saudi numbers being published yesterday,

it was minus 4.5%. In the first quarter, it was plus 3%. This is a country that was one of the most promising countries in the world. and it tanked and saudi arabia relative to other oil producing countries fared very well because they try to diversify their economy and they have pipelines to divert from east to west but other countries if you look at iraq you look at kuwait you look at qatar they have no other choice they got stuck so even at four minus 4.5 percent the saudi performance was way better than others. But now you take it worldwide, you got to think the following. Those countries, whether

you're talking about Saudi Arabia, UAE, Qatar, Kuwait, and Iraq, those are countries, they are heavy purchasers. They are heavy consumers. They are heavy importers. They are the one who import all kinds of things, whether from wheat to plants. And they are the one who's supposed to make those massive investments in the united states and they are the ones who are expected to be the largest donors to the poorer countries in the world all of that is gone all of that is gone the consumption is gone the investment is gone the aid is gone so what do you expect is going to happen the q q2 data the second quarter data is not out yet only we have very few countries that came out with the data.

And even if we get out of the data, if you think, and this is a message to the audience, if you really think that the oil prices and the oil market is heavily manipulated by the government and by the Trump administration, if you really believe it,

then you must believe that the economic data is manipulated too. It's just logical. I believe when it comes to the oil market that yeah there is some manipulation but based on evidence for the last hundreds of years basically it's it's and there are many theories there are books and articles on this you can manipulate the market or cheat the market twice three times and that's it and then the market figure it out and then you lose that edge and even opec basically realized this long ago that's why they

became very innovative in the way they make their announcements because once they are discovered people will know what the game is. So they became very innovative. And to think that the Trump administration is repeating the same thing again and again and again, and you are being fooled again and again and again, it is your problem, not Trump's problem. That tells you it's not. There is some manipulation in the market. That's absolutely correct. But we do have some structural issues. We have major decline in demand and we have demand destruction. Because one of the problems when we talk about that obsession that we talked about earlier we still have today until today we have analysts well-known names who think that oil prices have not increased

to match the crisis and that is absolutely not correct because if you look at at prices in March medium sour crude in Asia was sold above 170 dollars that was the record and we have some shipments being sold close to $200. And the damage came from there. You are living in the United States or Europe, probably you are not feeling it. But in Asia, they felt it. When China stopped importing 6 million barrels a day, they did because prices were $170. And even when they declined, they declined to $155 and they stayed there for a while. And people are still saying, well, Brent, sorry, WTI is $95 only. That's absolutely correct. But you are looking at the wrong marker. You are looking at the wrong market. They don't use WTI in Asia. WTI is for North

America. You want to look at the prices in Asia, you look at Dubai and Oman. And that was one of the problems. So what happened is those countries basically and refiners reacted to those extreme prices. But that's not the only story. You look at what happened in Japan. The Japanese yen, as you know, collapsed. So oil prices in the end were the highest ever. And Japanese refiners are not going to buy that oil. There is no way they are going to buy at the highest price ever. That's why their inventories declined substantially, because they would rather use their inventories than to pay the highest price ever. So I'm going to tell you, you've been in this market, you've been there for a while. How many times you heard about the Japan basically having the highest

prices ever quite a few because they're heavily dependent on it right sorry they're heavily dependent on oil right no no i'm talking about japan refiners paying the highest price ever how many times you heard that no never why but this is reality why the media why analysts are not talking about that so there are there is this obsession thing that oh we still need for prices to go up well if the damage already is already happening and already happened because prices went up and japan basically was damaged you cannot kill the horse twice the horse already being killed you cannot kill it twice that's it it's not there and if it's not there then you cannot feed it it's dead so the demand destruction was so strong in in asia and parts of the world

like a higher price doesn't make sense because nobody's going to pay it and they'll just say Even if you look at the United States, look at the data that was released this morning. This morning, the decline in gasoline demand is almost 2.5% year over year. And has nothing to do with EVs, by the way. Had nothing to do with EVs at all. And so how do you explain that? U.S. demand was going up. Now it's 2.5%.

It was going up by 1.7%. So the difference is between 1.7 and 2.5. That difference is very large. So, the damage is already happening even in the United States, but we still need more time to get the data. In other countries, you look at Pakistan, you look at Bangladesh, you look at Tanzania, Kenya and South Africa, Egypt, those countries are completely devastated. And it's not only oil.

Let's remember that. This is my cheating sheet here. OK, so. Hermes rate is not only about oil. It's about helium. And you cannot make any computer chip without helium. It is about fertilizers and we cannot find food without fertilizers. It is about methanol and you cannot make biofuel without methanol. There are many products we cannot make without methanol. It's about aluminum. Aluminum prices basically set at record high right now as a result of that.

so it's not only about that and once you start adding those together and you see the massive increase in prices and costs and everything else it's not only about energy it's about everything else um it was my mistake because i was supposed to to buy uh two laptops and i kept delaying it and now prices are going up all the high-end computers basically went up and um i on the morning show that I speak on every single morning, I told them that there was a time when an air conditioning unit need to be changed, but I can wait. But the moment the crisis happened, immediately I decided to change it. And the cost is about $20,000, by the way. Because I know if I wait, the cost will go up. The same unit that I paid $20,000 at the beginning,

that's only five months ago now it's 26 000. and this is in the united states there so the the the problem and the crisis or what we've seen so far is only the tip of the iceberg yeah well i'm happy you brought that up particularly fertilizer because i had somebody in my dms the other day um basically saying that they have a buddy that works at a a fertilizer refinery in louisiana and the workers there have gotten noticed that their their hours are being reduced to 80 percent and he thinks it's uh basically like a extend and pretend before furloughs and um layoffs come because they started importing fertilizer from from morocco um because the the input cost here the refineries in the us went from something like 400 to 1700 or something

like that in addition basically we have a new problem that we covered in the daily energy report today uh that banks are going to um uh support the building of 15 billion dollar um ai center south of dallas and when you are talking about 15 billion dollar ai center Of course, the energy consumption is just beyond imagination. And they are going to build their own gas-fired power plant. And the question that we raised is where that gas is going to come from. And when we work this backwards, we found out that there will be a time, probably in two to three-year time, when US LNG is going to fight, literally fight with the data centers over gas. Freaks, look at me.

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a bridge to the future it is the future it seems absolutely absolutely but now it's getting like what i as you know i've been bullish on on lng etc but whatever we have right now is is way above the expectations and one of the problems is once the cost goes up everyone gets hurt because for lng you have only limited margin and for the ai the competition is so severe that if your cost basically you cannot manage your cost you have a serious you have a serious problem and with ai by the way people are talking about solar and wind etc you cannot afford to lose power for one second Not even one second. So you need a reliable energy, and that's why they are moving toward nuclear and natural gas as a result of that.

It's nice to have solar and wind next to you as redundancy basically becomes important. But you need those things. So if you look at all the data centers around the United States, all of them have backup. And the irony is all that backup is a diesel backup. Mm-hmm. so what does this mean what do the next 30 60 90 days look like what what should we be hoping for in terms of any resolution i i i really want people to read that paragraph that uh a long paragraph that i wrote uh and it sounds gloomy and kind of very pessimistic view and probably

we have to go through that to get the better future that we are looking for otherwise things the way they are in will drag on for a very long time and this is not in the interest of anyone let's get it over with let's get the bad news and and get it over with and let's have that demand destruction and everything else until we move forward otherwise it's going to be very very difficult situation and uh something got to give things do not add up so i'm going to give you another example on how things got to give i don't know how much time we have left you've played 20 minutes as you know the saudis couldn't export their oil through babelmandeb on their own ships so saudi oil is going through babelmandeb but on someone else's ships and saudis have one of

the largest VLCC fleet in the world and now the the discussion is going toward okay how they are going to export it through the Swiss canal here are the issues if they want to export it through the Swiss canal the Swiss canal cannot handle a fully loaded VLCC so you got to forget about that They can send the ships that can take 700,000 barrels to 1,000,000, 1.1. That can go through. But if you are talking about 2, 2.2, they cannot. Long time ago, they found a solution. The solution is, if you can imagine the map, you send the ships north in the Red Sea.

You go to Egypt just before you reach the Swiss Canal on the left. There are a couple of lakes there. On the left, there is a small town called Ayan al-Sukhna. Ayan al-Sukhna, they built a terminal there with storage facilities, and it's connected to the Mediterranean via a pipeline called Sumed. Sumed, that's the waste Mediterranean pipeline. And the pipeline, if you can imagine the map, it goes west, crosses the Nile, crosses Cairo, and then turn north and go to Alexandria.

Next to Alexandria, there is a small town called Sidi Qreya. They made the terminal there, and it has a storage facility of about 22 million barrels. So those big ships basically would go there historically. They used to go to Anasakhna and load some. They would float, and because of the shape of the ship, now they can go through the Suez Canal. But later on, the Saudis basically kind of, because of efficiency and better management, everything else, they learned, I don't even have to send all of them at all. I can just unload everything and send it via pipeline because the pipeline capacity is 2.5 million barrels a day.

And I can send it to the other side. Ships can come from the other side and load. I don't have to go through the Swiss Canal and pay for it and all that stuff. So the question now is, can Saudi Arabia export 6 million barrels a day, which is the amount of export they have before, through this method, both Swiss Canal and Sumit Pipeline, to compensate for the losses of Hermes and Bab el-Mendib. And the answer is, yes, they can. And you can work the math, you can work the capacities, everything else.

They literally can. That's the easy part. The problem is, now ships, instead of going from Bab el-Mendib directly to Asia, Now they have to go from the Mediterranean all the way around Africa to go to Asia. Once you start playing the math, there will be a time when the Saudis wanted ships, but there are none. Because all of them in the ocean. Those that are going to deliver and those who are returning. And therefore, they have to stop exports and they have to stop production.

that's the problem right now with the supposedly the new system if we are going to go with that new system so we do have a serious problem but with the hit to Egypt the day before yesterday for the LNG terminal and the two regasification terminals this is very serious because the question is whoever did that did they really meant did they really mean to hit the LNG or that was a message about the Swiss Canal because that unit on the Mediterranean is very close to the Swiss Canal, very close. So was that a message, look, we can close the Swiss Canal too? Or that was the LNG literally was intended?

And of course, there are several suspicious leaderships in countries you can put there. But the issue here is, even if all the stars line up for the Saudis and the rest of the world, aside from the risk, we will reach a point where we have more oil on water and we don't have enough ships. And what is the problem? The problem is a large number of the ships that could be available are sanctioned because they carry either they carried in the past or they're still carrying the Iranian oil and the Russian oil. So in a sense, you look at all of this, it's kind of like almost a self-made crisis. Once you start expanding and looking at the details of it. The final issue here is when we talk about those sanctions, we got to remember that in the short run, China was prepared. And China built those massive inventories of almost everything.

So China was doing very well throughout this period. The only way to hurt China is to drag whatever we are in right now until, let's say, a year from now. That's when you start hurting China. But by that time, the whole world would collapse. And probably the U.S. economy would collapse even before that happened. So there is a serious problem there that it's not only Hermas, it's not only Bab al-Mandeb, it's really this trade war and the issues with China and everything else that we got to look at. And when Trump visited China, the Chinese tried to be nice,

So they imported LNG from the United States to please Trump. What they've done last week. The same shipment that arrived in China, they resold it at a higher price. Now, China's talking about trade routes to Europe through the Arctic, too, as well. Which gets to the question, how does all this impact the relationships between the U.S., Gulf states? I mean, Europe is obviously affected by this. No, I I've been viewing this through the lens of, it seems like a big proxy war with China and this AI race at the end of the day, this time emotions are very raw.

So when, when, when people in the Gulf basically are extremely angry that they've been hit, their economy has been hit, their factory has been hit, the refiner has been hit and the, their emotions are very raw again. They are against the Iranians and they are blaming Trump because supposedly they have those contracts with Trump and they paid a lot of money and it's to be protected. And they were not protected. You look at countries like Kuwait, Bahrain, Saudi Arabia, et cetera. They were not protected. So the emotions at this stage are very raw.

That's why we see articles like one yesterday saying that Saudi Arabia literally should tilt toward the Chinese big time as a result of that. And that goes back to your old theory about the dollar and the Bitcoin and all the stuff. If you remember that, we did this, what, three years ago or something like this. So if that happened, that is a crisis. But why the Saudis are even talking or why some Saudis are talking about this? Because the emotions are very raw. And the Europeans are the same thing. They are suffering from the highest jet fuel prices ever, diesel prices, energy prices, everything is just too expensive. And they blame the United States because from their point of view, if Trump and Netanyahu did not go to Iran, we would not have this problem.

And of course, from my point of view, our problem with Europe is not only the United States. Our problem with Europe is its leadership. And if you look at what they've been doing, it's crazy. I mean, crazy beyond imagination. I'm going to tell you a story. Just last, this week, Germany signed a contract with Canada to import LNG from Canada, from northwest Canada. So if you can imagine the map, from that corner where Alaska meets with Canada, that's where they are building an LNG terminal. So Germany wants to buy LNG from there.

But Germany has all the choices from around the world that are way closer to Germany, but yet they chose this one because it has the lowest CO2 footprint per unit. Why? Because they use hydroelectric. They don't use fossil fuel. But it is fossil fuel. Okay, so here is the issue. How are you going to get that gas to Germany? look at the map we are talking about north western canada so that's almost like across the ocean from japan okay how you are going to get that to germany the only way to get it to

germany is to have an lng carrier going from the north pole because this is close to the north pole going all the way south to the south pole going around south africa going back again to the north pool. Imagine the footprint of the fuel that is used in the carrier just to get that LNG to Germany. So that's the first crazy story. The second crazy story is they said, oh, no, no, we are not going to do that. We will be doing something else. What are you going to do? Oh, we are going to do swaps. What do we mean swaps? Oh, we take that LNG from Canada. We send it to nearby japan and china okay and then whatever japan and china was going to get from the u.s from the gulf we get it from there so we do this swap so we save here's the crazy thing by their

own definition u.s gas is dirty because they chose the canadian one because it had the lowest co2 that's not the case for the u.s and the second one is they are anti-fracking and that gas came from shale where it's fracked so why did they just go ahead and get it from the united states it's cheaper it's better you are getting it anyway why you have to play like like this so you take this mentality of the european leaders and apply it to so many things and you will find they are playing all those games like that and they are destroying europe The deindustrialization of Germany basically has become so obvious right now, it's a big problem. Finally, I would like to end with the following.

As we speak right now, we have 15, literally 15 events around the world. All of them are bullish for oil, for energy in general. 15 events. We've never seen something like this in history in terms of everything lining up this way. Now, that does not mean oil prices will go through the roof. No. It just means that the economies will self-destruct. That's what that means.

So we have the Four Seas Crisis. If you look at the Panama Canal, in addition to everything we've seen, we have the Panama Canal. So when we talk about the waterways, by the way, as you all know, Panama Canal is a waterway. Bab el-Mandeb is a waterway. Swiss Canal, which was nearby the incident that happened, that's a waterway. And then we have the Hermos Strait. That is a waterway. The Black Sea, the only way to exit the Black Sea, that's a waterway.

And guess what? You've seen the video of those Moroccans crossing to Spain. That's another waterway. And one of my colleagues asked me today whether this is just another event of a waterway rather than an immigration issue. So almost every waterway we know of basically is having a problem. The Turkish waterways, well, Zelensky from time to time is bombing ships there. That's other waterways. And the Danish waterways there, they are thinking about blocking the Russian, the sanctioned Russian ships from passing.

So that's another wet water way. Anyway, so we have the Panama Canal because of low water level. So shipping is slowing down. Then we have the Rhine River where the water level is just like 30, 40 centimeters only. So barges cannot go through. They carry everything, including fuel and everything else. So we have problems there. In France, because of the heat wave, the temperature of the water in the rivers is a little bit high to cool the nuclear plants, so they shut some of them down.

And now they are using oil instead to generate electricity. So you start looking at all those events worldwide, and you can see that where are we heading now? we have a serious problem and and and all those events basically taking place we lost by the way uh libyan production from two oil fields because of disputes among the tribes so that was uh uh another one and now we are coming into the refining maintenance season so what next hurricane season two oh hurricane yeah yeah you're right there was by the way we lost some production because of the recent storm. What, Bertha?

I think the name was Bertha, yeah. Yeah. And then it's not really oil and gas related, but then obviously Taiwan's an island that is a waterway that can pop off at any moment. What would your advice to this administration be? I would rather just avoid talking about the politics here because it's too late.

The damage already happened. and it seems that there is a lot of things that we don't know but one issue when it comes to investment I think and I still think that LNG is going to be one of the best investments ever and LNG names especially American names basically are to pay off handsomely and natural gas basically in the United States is going to go up and down. So it's kind of very dangerous trade and investment. But for LNG, I mean, it's kind of like the best choice. Anyway, you look at it even 10 years from now, 15 years from now. On the oil front, it is a very dangerous trade, not because of the politics of

it, not because of manipulation, simply because of the demand destruction and the demand decline that happened. And as a result of this, everyone is looking at China and say, okay, only China was not affected that much by this crisis. So what we need to do to avoid this crisis again? So they are going to study China and they're going to find out that the success of China stemmed from the fact that they knew the information ahead of time, and they prepared for it. So they linked energy security to national security. They linked energy sources to energy security, and therefore, they made the immediate link between energy sources and national security.

And therefore, cost does not matter anymore. So what will happen now is every country, including European countries, are going to look at their domestic sources. And in most cases, they will say, okay, we have those climate change policies that failed on solar, wind, EVs, and batteries. Now we are not going to use the word or the expression climate change anymore. We are going to use national security because no one can argue with us when we say national security. So we are going to provide a lot of subsidies. We are going to give tax breaks.

All this criticism about subsidies and tax breaks will disappear once you start talking about national security. And once you do that, you are going to see emphasis on solar, wind, storage, batteries, EVs. So one of the best investments probably will be in the future or in the coming years, basically, storage batteries in addition to LNG. Because this is going to be very big no matter what. And governments are going to subsidize it. So it's going to happen. But that does not mean the emphasis on climate change and national security does not mean that renewables are going to take over. It's exactly the opposite. Now, countries basically are going to hold into coal. We are bullish on coal. Coal is going to stay with us for years to come after Hermes. Hermes saved coal. And then there will be a lot of emphasis on natural gas.

Natural gas, like we said before, is going to be the future. Hermes has sealed the case for natural gas and LNG. So when it comes to energy, I think the road is very clear right now. The idea that we'll go back to the past is not going to happen. Hermes is not going to be the same. Development is not going to be the same. And the whole oil industry is not going to be the same. It's a brave new world.

and the the issue of national security basically and that's where the fear is remember there were a government that owned owned companies oil companies and then they privatized them but they still own 49 percent or 20 percent or 10 percent or whatever and i fear that there will be a time when we are going to see nationalization even in the west it's already happening so we'll see more government control it's already happening in ai until happening yes rare earth metals so i the fear is it might move to the energy sector where do you think they would start batteries or natural gas i mean you sort of already have it right with the the renewable energy credits i guess it's not really nationalization they don't

equity stakes in these companies but in a in a sense the spr is the strategic petroleum reserve but i don't think it's going to be enough because when it comes to energy dominance those who created the concept of energy dominance basically they missed one area and it is the most important area which is refining if if the united states wants energy dominance they need to increase refining capacity by at least 4 million barrels a day above today, which means that probably we need at least three, four refineries, new refineries. And you need more because some of the refineries have to literally, they are so old that you need to get rid of them. So probably we need more than that. But for the energy dominance, you need more refining. And the refining sector

did an incredible job in term of uh financial performance a recent mass i mean just look at uh valero and all the other sisters just incredible performance i mean we wouldn't even talk about venezuela and if the us wants to take advantage of that oil it's uh ask me i mean And what is the state? Last time we talked, it was about Guyana and the deposits. Obviously, since we last talked, Maduro was taken out. It seems like the U.S. is partly taking part in regime change there. I think there's...

Since December, it was very clear. And we published reports on that, basically saying that, look, Venezuela, based on various pieces of information we have, they can increase production up to, or exports to 1.1, probably 1.2 million barrels a day, and then they stop, and then they need way more time to increase production and exports. And that's where we are right now. So they reached their maximum, and now we need that investment to take place for it to increase production. The problem is people have to realize that the problems are too many. And the Trump administration and the Venezuelan government have done a big, very big mistake.

It's a historic mistake, which is the speed in which they changed the laws in Venezuela to allow the American companies to come back. That's a big mistake because any new Chavez, any new young Chavez basically can come back and said, look, this was under duress. The American army was in our capital, and our leadership was threatened, and therefore they had to change the laws, and they did not consult the Venezuelan people, et cetera, and therefore all of those basically are void. They should have taken their time, literally, to change those laws so they can be on kind of firm ground to make the changes. Because if you look historically at what happened, you can see it. And not only in Venezuela, basically in various countries, the same thing. So I think they have not learned from history that they should have taken their time to change those laws.

Trump was in hurry, and those guys in charge in Venezuela were in hurry, and they've done it quickly. And that is a very big mistake. To increase Venezuelan production by another one million barrels a day, they need three years. The problem is U.S. companies, even in the negotiations, are still having serious problems. Why? Because the change of the laws was so quick, there is a kind of mismatch between certain laws and those laws. Just to give you an idea on how the mismatch happened.

Remember when Trump allowed Iran, that was a month and a half ago, when he removed the sanctions or suspended the sanctions on Iran, And he said Iran can sell its oil freely and for U.S. dollars. OK, well, it did not work out. Iran did not sell a single drop of oil. To any country except China. Despite that, why? Because the Trump administration missed two things. First, to deliver that oil, you deliver it on ships.

And those ships were sanctioned individually. So no country is going to allow those ships to come in no matter what. So they allow, they kind of ease the sanctions on one side, but when it comes down to practical things on the ground, it did not happen. And then Iran is still out of the SWIFT system. So how are you going to pay them? And the Iranians said, if you're not going to pay me cash, I'm not going to take anything from you. I'm not going to deal with you. So you take this idea of conflict between the policies, you have Trump easing the sanctions, but all the other laws are still there.

So easing the sanctions meant nothing. We have the same problem in Venezuela now. They changed the laws here, but we still have many things here, here and here that do not work to achieve that objective. So companies are still struggling. The other thing is, because of what's been happening in the last 15 years or so, think about it this way. The cream of the crop of Venezuelan engineers left the country long ago. To work where? To work in Aramco and Adnok and BP and NA and Total around the world.

And guess what? Their salaries are international salaries. They got paid handsomely. Those guys are not going to go from, let's say, $250,000 a year to $40,000 or $50,000. There is no way, which means that you have to pay them the same international salary to bring them back. That changes the calculus because they kept telling us it's so cheap, it's so cheap, it's so cheap. But if the cost is going up, that changes the calculus. And this is one of the

problems. Otherwise, they have to bring the American engineers, and the American engineers are the most expensive engineers in the world. So they have all kinds of problems right now, and they can be solved on the margin. But in terms of politics and political instability, I think Venezuela is still an explosive gig and we don't know what's going to happen tomorrow. And the reason why, because the

actual Venezuelans on the street have not benefited from the change that happened until today. They haven't seen it and they need to see it to believe in it. A lot going on all over the world.

I'm sorry, I have bad news today. it's all bad news so i don't know what to say no it makes you i mean going back to national security strategy i think yes energy dominant dominance was a theme with the other big theme and that was like hey we're going to stop expanding our military excursions throughout the rest of the world to try to pack it in focus on the western hemisphere and seems like almost immediately i mean obviously when maduro was taken out overnight it was very odd how it happened um thank god it was very swift and quick there's no ground war i think everybody's like okay this makes a little sense but then when iran started it's like wait a second you just went back on

everything you said was the strategy no more middle eastern wars you literally darwin three months later one of the criticisms that been pointed out against what i've been saying basically is saying that uh the those plans are too complex for president trump and his team they don't think highly of them in terms of being smart and therefore I am completely wrong I have no problem and I hope I am wrong

because if I am wrong that means things are better but they have to realize that these plans being constructed over a long period of time way before Trump and Trump and his team basically just executed the plan

and probably they executed it badly. It does not mean that all these plans that we see today are coming out of Trump. So the issue here is, whether you like it or not, if you look at how the United States took over 30% of the EU LNG from zero to 30%, if you think that just happened, no, it did not happen just like that. There were plans. There were plans. They put those plans, and we have construction, and we have things and we have companies and we have government involved and we have President Trump and President Biden going around basically marketing this LNG, et cetera, this did not happen overnight.

These things happened because of a plan. So to think what – because they are trying to sell us the idea that, oh, Netanyahu came into Trump and said we are going to attack Iran and Trump just got convinced and all of a sudden we have all the U.S. Navy overnight there and just hop it this is naive just to to put those ships there takes months to prepare so it cannot be just the way they are describing it as just you know things just happen there is more to the story than that and then you all you know the variable of like drone warfare asymmetric drone warfare really starting a wrench in conventional naval naval battles as well so

So that adds a layer of chaos and unpredictability to the mix that you'd like to think people would have the foresight to imagine. But I mean, when there's the drones going from Ukraine to Russia or Iran to Gulf states, I think it's pretty clear that these drones are having an asymmetric effect. Absolutely. Absolutely. Well, Nas, it's always a pleasure. I know it's Friday afternoon for both of us. Thank you. Thank you. I appreciate you. always thank you and i apologize to the audience i don't have better news to tell you uh but just be careful out there and uh just focus on the real things don't be fooled by the media don't

be fooled by this big account on social media etc and don't take my words for granted in any way take my words basically and judge them against everything else you hear because that's the way to go if you just take things for granted and you have that obsession that i criticized in the beginning you are going to lose money so be careful and best of luck for all of you beware freaks peace and love okay thank you for listening to this episode of tftc if you've made it this far i imagine you got some value out of the episode if so please share it far and wide with your friends and family we're looking to get the word out there also wherever you're listening whether That's YouTube, Apple, Spotify.

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