Someone is trying to manufacture an oil crisis. [USO]

Years of low oil prices seem to be making someone somewhere nervous enough to start trying to change that artificially.  Maybe it's Iran and maybe it's whoever pulls the strings of Iran.  But recently we have two actions that were clearly designed to threaten or outright decrease the global oil supply and neither of them were done by accident.

The first event was the silly Iranian threat to block the straits of Hormuz.  This "block the straits" gambit has been on the books for a long time as one way to disrupt the national oil supply.  Nobody took that seriously when Iran threatened it and I would not take it seriously now.  Another related action was Iran's reported attack on some tankers in Fujairah.  I've grow wary of believing any headlines at face value these days because the media is nothing more than a propaganda machine.  But assuming someone in Iran did orchestrate these attacks, it's not clear that the central government of Iran is fully in favor of them.  If the Iranian government would have wanted to sink the two Saudi and one Norwegian ships that were damaged in the attack, those ships would be at the bottom of the ocean.

A second "coincidental" event is the more scary of the two IMO.  It seems that someone used a small, privately owned terminal in the Samara region to introduce a contamination into the Russian-EU pipeline.  This particular class of contaminant, organic chlorides, has the ability to damage a refinery which might try to process it.  This is not some terrorist attack by normal people, it took someone with in-depth knowledge of the oil distribution and refinery business to target this contamination.  While the sabotage was pretty serious, it looks like a short term blimp that can be mitigated over time by mixing the contaminated crude with clean crude at a ratio that keeps the organic chloride levels within tolerances.

Both of these events happened within months of each other and neither of them we accidental.  Seems like someone, maybe Iran, maybe the Saudis/OPEC and maybe someone else using them as pawns wants to manufacture an oil crisis.  Unfortunately for them, the wave count for the current wave has peaked and now oil is most likely to actually make a new low based on strong US fracking output combined with diminishing consumption demand (which could be related to perceptions about a slowing economy, the rapid expansion of electric cars, or both).  The test of USO's center channel is expected to hold here somewhere in the mid to high $7s, but if that support cannot hold then the lower rail will be the next support in the low $4s.