U.S. crude reserves are nearing critically low levels, with one warning pointing to possible gasoline shortages by July 4 if the Iran standoff drags on.
Despite the conflict, oil prices have drifted back toward pre-war levels, a pattern that may signal recession rather than a price spike.
There have recently been many warnings about near-term oil shortages stemming from the conflict in Iran. Most analysts assume that shortages mean higher prices. However, the dynamics of a self-organizing economy suggest the opposite outcome — lower prices, deepening recession, and shortages of goods and services that have little to do with price.
Ultimately, oil prices could drop back toward pandemic lows rather than the massive spikes many analysts are warning of.
