Lower Prices May Be Top Cure for US+Canada Surplus The recent WTI crude oil surge may add fuel to an incomplete low-price-cure cycle toward $40 a barrel. My graphic highlights a key reason why: the growing surplus in US and Canadian crude and liquid fuels supply. At about 8 million barrels per day (MMBD) now, simple regression shows the surplus approaching 10 MMBD in 2028. What stops this train? Lower prices are a top candidate, but the market got the opposite in 1Q's surge to roughly $120. Demand pressure and supply incentives will be the elastic response -- a question of magnitude -- especially with the US average breakeven production cost near $55. My graphic features another trend that, when it reverses, could trigger post-inflation deflation and pressure crude toward $40: some reversion from the highest US stock-market cap-to-GDP in about a century. Full report on the Bloomberg here: https://blinks.bloomberg.com/news/stories/tdsfzjkgifs5 {BI COMD} #crudeoil #stockmarket #macroeconomics @BBGIntelligence(Mike McGlone)