STOCKS | Jeff Currie Says U.S. Gasoline Faces an Extremely High Risk of $5 Before Midterms

Jeff Currie said U.S. average gasoline prices are almost certain to reach $5 per gallon before the midterm elections, citing scarce supply and currency depreciation. According to Sina Finance, the Real Macro founder and CEO said shortages that first appeared in refined products are now spreading upstream into crude oil, and that the energy shock is entering a dangerous new stage. Currie said crude oil is the signal, while refined products are just noise. He also said the chance of gasoline reaching $5 per gallon by Election Day is "extremely high," and warned that refinery switching between diesel and gasoline output could eventually exhaust operating flexibility. He added that there is no sign strategic petroleum reserve releases, which previously helped fill supply gaps, will resume. Currie said U.S. diesel prices could rise to $7 to $9 per gallon. He also said Thursday's price action, with Brent futures at one point up more than 8%, showed the market is preparing for a larger and longer-lasting supply disruption, and noted that the entire forward curve has moved, not just the front end. He said the current commodity rally is entering a truly dangerous stage because shortages at both ends are so severe that the whole market is rising. Currie also said soybean prices at $13.30 per bushel, along with elevated wheat and corn prices, mean the market is in a food crisis, while copper has repeatedly hit record highs in recent weeks.