It was a breath of fresh air listening to our new Fed Chairman channel his inner Chevy Chase or Ty Webb when Kevin Warsh said: “Market participants are learning to play the ball, not the referee—and market prices will continue to respond in the direction and magnitude they see fit. This is, in my view, a change for the better—and we are just getting started. After all, the central bank need not always and everywhere be the center of attention. … And where necessary and appropriate, we will not hesitate to act.”
In other words, don’t ask what the Fed can do for the economy or your portfolio—ask what you can do for yourselves.
I agree this is a change for the better. Instead of markets obsessing over what one Fed official said at a fancy lunch or dinner only to be contradicted by the next, less Fed transparency may actually be more. We can focus on markets and the economy rather than remaining dependent on the old Fed put. Be the ball, Danny. Just stop thinking… let things happen… and be… the ball. Nanananananana.
This reflects his broader shift toward less forward guidance, shorter “just the facts” statements, and eliminating individual rate projections. It also reinforces the Fed’s commitment to its 2% inflation target—“There is no soft inflation target… We will deliver price stability”—without allowing markets to dictate the timing or course of policy. In short, the Fed remains firmly focused on inflation and its dual mandate, and market pricing will not constrain its decisions.
are higher on renewed attacks on Iran that were retaliation against an Iranian attack on U.S. soldiers. Reports say the U.S. strikes on Iran’s Zanjan killed 3 IRGC members Thursday – Fars. Also, a big draw in the U.S. report, an uptick in production and demand have oil bulls worried about tank bottoms. More worried than the actual oil market seems to be.
Iran’s IRGC claimed it targeted a U.S. base in Jordan on Thursday morning and vowed to “punish the aggressor today.” Despite the rhetoric, the market remains relatively contained.
Iran says talks with Oman over management of the Strait of Hormuz continue (ILNA). Ships are still moving. Qatar just sent its first LNG cargo through Hormuz since the tanker attack three weeks ago—the Al Areesh is underway, apparently headed toward Pakistan. So some traffic is flowing.
This is the pattern: threats, limited kinetic action, then claims that the aggressor will be punished. The real question is whether the IRGC and the regime finally realize this is a losing game for them. Escalation risks disruption, higher prices, and more pressure on an already strained Iranian economy. Bluster is cheap. Sustained control of the strait and the ability to absorb repeated U.S. responses is not.
The EIA report added fuel to the bullish case even as some oil bulls worry about the bigger picture. (ex-SPR) drew a bigger-than-expected 7.2 million barrels to 404.5 million—the lowest level since 2018 and roughly 6–7% below the five-year average. Cushing dropped another 771,000 barrels to 18.6 million, the lowest since 2014 and below the 20-million-barrel operating comfort zone. Refinery runs rose 271,000 bpd to 17.3 million barrels per day with utilization at 97.2%. Production held near 13.8 million bpd. Exports edged higher.
U.S. demand (products supplied) over the last four weeks averaged about 20.3 million bpd, still running below year-ago levels. Some bulls are more worried about eventual tank bottoms and soft demand signals than the physical market currently is. The draw is real, Cushing is tight, and exports remain a key outlet. That combination keeps a floor under prices even while geopolitics provides the upside volatility.
While policymakers in the West keep talking about China “going green,” the reality on the ground is different. Reports say that China’s coal prices are surging as scorching heat drives power demand across the country. Thermal coal at Qinhuangdao has rebounded hard, inventories are being drawn, and mine suspensions are tightening supply further. Heat waves are also limiting hydro and wind output, so coal is filling the gap—again. All the green rhetoric meets summer air-conditioning demand and the result is more coal burn, not less.
Big Oil is cashing in. reported $9.8 billion in adjusted earnings for the second quarter—more than double the year-earlier figure—helped by higher oil and gas prices, strong trading, and elevated refining margins. Energy prices and volatility are delivering.
Congratulations are also due to Cenovus for joining the million-barrel-a-day club. The company is a dynamic Canadian oil name and a leader in the oil sands. Production is running near or above that threshold in July after the MEG integration and strong oil-sands performance. Now if Mark Carney could get out of the way, Canadian producers could do even more. Yahoo reported that reported second-quarter 2026 results with sales of C$17,427 million and net income of C$2,870 million, sharply higher than a year earlier, alongside stronger earnings per share. The company coupled this performance with higher 2026 production guidance, continued share buybacks, and a C$0.22 quarterly dividend, underlining its focus on scaling output while returning cash to investors.
Elsewhere, the IDF continues finding dozens of weapons caches in civilian infrastructure in south Lebanon villages—another reminder that the proxy networks remain active even as the main Iran-U.S. confrontation dominates headlines.
The real stress in the oil market right now isn’t just the crude price — it’s diesel.
While crude has been swinging on every headline out of the Middle East and every rumor of a truce, the diesel crack spread has been screaming the truth. That refining margin — the difference between the price of diesel and the crude used to make it — has surged again to extreme levels. Recent readings put the prompt diesel crack in the neighborhood of $85–$90 a barrel, levels that in some cases approach or even exceed the price of the crude itself. That’s not normal. Typical diesel cracks run more like $15–25. This is stress, pure and simple.
Diesel is tight around the globe, and the market is pricing it that way. Russian refineries have been hammered by Ukrainian drone strikes, cutting output and forcing export restrictions that have taken a major supplier partially offline. Middle East refining capacity has also been disrupted by the ongoing conflict. Add in lower runs in places like China and you get a global refining system that’s running well below where it should be for this time of year — Goldman Sachs just flagged diesel as the “epicenter” of the squeeze, with global throughput down sharply year-over-year. This is the same thing we flagged at the beginning of the conflict and even before.
U.S. distillate inventories have been running below the five-year average for weeks. European stocks are even tighter, with analysts warning of multi-year lows heading into the fall. The result: refiners are being paid handsomely to make diesel, refining stocks have been flying, and the product side of the market is holding up far better than crude would suggest.
This matters beyond the trading floor. Diesel powers the trucks, the farms, the construction equipment, and a big chunk of the freight system. When the crack blows out like this, the cost pressure doesn’t stay in the oil market — it filters into food, goods, and just about everything that moves. We’ve seen this movie before, but the combination of war damage, export limits, and already-low inventories has made the current squeeze especially sharp. Diesel is telling a different story: physical tightness is real, and it’s concentrated in the middle of the barrel. Until inventories are rebuilt and more refining capacity comes back online, that crack is going to keep reminding everyone where real stress is.
For the oil prices we continue to say follow the gaps despite the physical tightness gaps have been filled and they have been reversal points any talk of a ceasefire or peace Dale could cool things down and keep an eye on the Strait of Hormuz as traffic seems to be back in the uptick.
took a solid hit this week, sliding to multi-month lows near $2.70 after a string of declines. Front-month settled at around $2.72 Wednesday and is trading soft this morning. Record production, comfortable storage levels, and softer near-term demand have kept the pressure on.
Fox Weather is pointing to moderating temperatures in key regions after the recent heat. That cooler shift is capping power-burn expectations and has traders dialing back the bullish weather bets that supported prices earlier in the month.
All eyes now turn to this morning’s EIA natural gas storage report (10:30 a.m. ET). Inventories remain above the five-year average, and another solid injection would reinforce the well-supplied picture. A smaller-than-expected build could still offer a short-term bounce, but the bigger trend remains weather- and production-driven. We’ll watch the number closely and the Fox Weather app to see if the moderating forecasts hold.
