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Folks,

I'd like to discuss a theory I have.

The upshot of COVID19 was a massive decrease in demand for oil products.
As we've all seen, the price of crude oil recently tanked as a response to a massive oversupply and a significant decrease in demand.

As a result, it appears that at least many American companies have decreased production or stopped production entirely.

I've reviewed oil capacity in the US, and I do not believe that even if the Saudi oil tankers arrive by end of May, we will have a glut storage issue. I've been reviewing traffic congestion indices throughout the world, and China just started massively opening up, to the point where there is more traffic in highways in China than there was at this time last year. https://www.tomtom.com/en_gb/traffic-index/chongqing-traffic...

Jet fuel consumption in the United States accounts for only 6-12 percent of total petrol utilization. Air traffic at this time is on the rise, albeit rather slowly. https://www.flightradar24.com/data/statistics

Saudis have decreased production.
Russia yesterday decreased production of oil headed westbound by 50 percent leading to an immediate surge in price of the Ural oil by 40% or so.


I believe that there will be an acute oil supply shortage in the coming months, and that the price of oil will increase significantly and very acutely. This is my theory. Everyday I review the tomtom data, and it looks like in every city in the US, traffic is slowly coming back to normal (in some places in the US, since the past couple days, it is nearly back to normal, i.e. El Paso; though I concede that major cities like Los Angeles and San Francisco are at about 10-20% of normal--but California is on the eve of re-opening).

We are headed into the summer season; where energy usage will increase; and where younger adults and kids will want to explore the world; etc. I am certain they will drive to the beach; to a lake; to the mountains; they will want to get out of the house.

At some point, the economic pressure on the American worker and business owner will be too much; and all small businesses will open up. In order to make a living, folks will have no choice; they will have to sustain themselves economically despite the virus.

The healthcare sector in the US will not be able to mount a second response, and I believe that in our American cultural context there will not be a second shutdown.

In order to act on such macroeconomic inquiries, I've positioned myself with the following ETFs (exchange traded funds) ERX, GUSH, and several other oil-related companies including OXY (Occidental), HAL (Haliburton), SLB (Schlumburger), and OII (Oceaneering international) (courtesy of the motley fool, because why not).

My question to everyone is: how can I maximize my exposure to what I think may be this focal and acute economic prediction?

I'm setting aside a small amount for this hedge, but I'd like to know how to maximize this on the basis of this theory.

I'm open to any other strategies.

Best wishes,
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