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I suppose there is something else that could add to the supply of bad news today on oil supply, but we’ve already got a full dance card

At 2 P.m. in New York U.S. crude benchmark West Texas Intermediate traded up 5.07% to $121.55 a barrel; international benchmark Brent crude was up 6.24% to $125.48 a barrel.

Where to start?

Oil prices soared on reports that the United States (and some European allies) were about to halt energy imports from Russia. Priced fell, somewhat, after Germany said it has no plans to half Russia energy imports. stop diesel Which didn’t stop diesel futures in Europe and the United States from reaching the highest level in decades .S. touched the highest in decades. Shell said it is limiting sales of heating oil in some parts of Germany as supplies of the fuel come under pressure. U.S. gasoline futures surged to the most on record in data going back to 2005. American pump prices are just 5 cents a gallon away from an all-time high set 14 years ago.

All of which has raised market fears of a huge inflationary shock to the global (and domestic economies) perhaps big enough to create a recession.

One of the hopes for increased supply hit a major roadblock over the weekend as Russia said it would block a renewal of the international agreement on Iran’s nuclear program and an end to sanctions that would release Iranian crude back onto world energy markets. Russia said it would not sign unless the agreement removed sanctions on Russia’s trade with Iran–which would open the way, I’d guess, for Russia using that country as an end-run around current economic sanctions resulting from the invasion to Ukraine.

The secretary of Iran’s Supreme National Council, Ali Shamkhami, has tweeted that his country is seeking “creative ways” to restore its nuclear deal after Russia’s foreign minister linked sanctions on Moscow over its war on Ukraine to the ongoing negotiations. (Ge, you think this might be an attempt to throw a spanner in the deal so that Russia gains leverage in its Ukraine standoff?)

Negotiators had been signaling that a potential deal was close so this is a major supply side disappointment. (Although from what I understand of the time table it would take months for all the inspections required by the deal to be completed and for Iranian oil to flow back onto the market.)

And then, of course, there are the usual production problems from OPEC members. Libya recently said its output fell below 1 million barrels a day because of a domestic political crisis.

Back in the USA, so far big oil shale producers are holding to promises not to increase capital spending in order to pump more oil. (Those promises are one reason that shares of big produces such as Pioneer Natural Resources (PXD) and ConocoPhilips (COP) are down today even as oil prices soar. The other is a fear of recession that would indeed cut demand for oil.)