Normal Reversion Path Toward $40 WTI Crude Oil When WTI crude oil first traded at $120 a barrel in 2008, the US and Canadian supply deficit was near 10 million barrels a day (MMBD) and US stock-market cap-to-GDP was closer to 1-to-1. Now the US and Canada surplus of crude and liquid fuels is nearing 8 MMBD and stock-market cap-to-GDP stretched to about 2.3x in 1Q, the highest on a year-end basis in about a century. A prerequisite for industrial commodities, notably copper and crude, to remain elevated may be a resilient stock market. The closing of the Strait of Hormuz sparked a global energy crisis, which could be a catalyst for economic contraction and a ballooning Western Hemisphere energy surplus. About $40 has been a pivot since Iraq's invasion of Kuwait in 1990. Lower energy prices, inflation and interest rates are stated goals of the Trump administration and the midterms are in November. Full report on the Bloomberg here https://blinks.bloomberg.com/news/stories/tcv2qckgzaj2 {BI COMD} #crudeoil #stockmarket @BBGIntelligence(Mike McGlone)