Last week's price action clearly agreed with me as the futures markets finally saw some position squaring into the quarterly close on Friday.

At least that's what I thought at the time.  It turns out that there were a lot of people who must have known that OPEC+ was going to announce a surprise production cut while I was yammering into a microphone Sunday morning. Because they bid oil up into the quarterly close using the tailwinds of strong closes across the entire 'tangible assets' space — gold, stocks, US treasuries, industrial metals, etc. — as cover.

The 'deflation trade' hit its peak when Brent crude futures bottomed near $70 per barrel on March 19th.

Thanks to OPEC+'s announcement Brent Crude gapped open at ~$85 per barrel.  West Texas Intermediate (WTI) moved above $80 and the Brent/WTI spread is trending towards $3.

It was $8+ a few months ago.  This is very good news for US producers and exporters.  The oil market had a fundamental supply and demand mismatch.  Back in January even the IEA was talking nearly a 1 million bbl/day mismatch between supply growth (<1 million bbls/day) and demand growth (>1.9 million bbls/day). And that was with a recession on everyone's lips to start the year and China locked down.