Demand Destruction Risk Grows as Oil Prices Surge on Middle East Supply Shock
Demand destruction is simple. When prices get high enough, people and businesses stop buying. I’ve seen it happen before and the setup right now looks familiar. Gasoline, diesel and jet fuel all have a breaking point where consumers start making different decisions. They drive less. They cancel trips. Companies start trimming shipping runs and cutting production costs wherever they can. We may be getting close to that point right now and the market needs to start taking that risk seriously.