Anas Alhajji: SPR Releases Fix Nothing

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Anas Alhajji came back on the show this week, and he opened with something I've been thinking about constantly: in a world where central bankers are tripping over themselves to devalue their currency, Bitcoin wins. That framing set the table for everything that followed, because the energy chaos we spent the next hour dissecting is the same story running through a different pipe.

I've been watching this conflict through the lens of the National Security Strategy document the Trump administration published last November. That document called for energy dominance and AI dominance, and when you read it, the Iran war doesn't look like a detour from the strategy. It looks like an extension of it. Alhajji largely confirmed that read, walking through how US LNG share in the EU went from zero to 30% after Nord Stream, how Qatar is now importing American LNG to re-export to Asia, and how ExxonMobil and Chevron are returning to Iraqi oil fields they previously abandoned.

These are not accidents. There were plans.

What I want this post to do is lay out the parts of the conversation the mainstream energy commentary keeps getting wrong: why the SPR headlines are a red herring, why WTI is the wrong price to watch, what the Four Seas Crisis actually means, and where this ends up for natural gas, LNG, and anyone trying to figure out where to position from here.

Key takeaways

• SPR releases cannot fix a products crisis. When refineries are already running at maximum capacity, pumping more crude into the system does nothing for gasoline or diesel prices. The crisis after April was in products, not crude, and the SPR draw addresses neither.
• WTI is the wrong benchmark. The real damage showed up in medium sour crude in Asia, which Alhajji reports traded above $170, a level that caused China to stop importing 6 million barrels a day and Japanese refiners to drain inventories rather than buy at the highest yen-denominated prices ever recorded.
• The Four Seas are all disrupted simultaneously. Hormuz, Bab-el-Mandeb, the Black Sea, and the Mediterranean are all in trouble at the same time. Add the Panama Canal low-water slowdown, the Rhine at 30-40 centimeters, and Kazakhstan's 1.4 million barrel-per-day export stoppage, and you have a combination with no historical precedent.
• Hormuz is not just an oil story. Helium for semiconductors, fertilizer inputs, methanol for biofuels, and aluminum all move through the same chokepoints. The price signals are already showing up in the US, from Louisiana fertilizer plants to consumer electronics to HVAC units.
• The Iran war fits the energy dominance playbook. US LNG market share in Europe went from 0% to 30% after Nord Stream. Qatar is now importing US LNG to re-export to Asia. These outcomes were documented in the NSS before any strikes were ordered.
• Natural gas and LNG win from here regardless. Hormuz has permanently sealed the case for gas as national-security infrastructure. Every government will now frame energy policy through that lens, subsidies will follow, and American LNG names are positioned to benefit even as data centers and export terminals begin competing for the same supply.

The SPR story the media got wrong

I'd been seeing commentary comparing Trump's SPR draw to Biden's, framing it as some kind of trade, sell high, lock in returns for the reserve. When I brought that to Alhajji, he stopped me cold.

Biden's total SPR release came to 211 million barrels, 180 million from the reserve itself plus congressionally mandated draws. The context matters: we were coming off the lockdowns into a demand surge that would have sent prices above $200 without that intervention. No Russian oil was actually lost to the market despite the sanctions; it was a demand shock, not a supply shock. The 211 million barrels got absorbed.

Trump's draw, by Alhajji's account, is smaller in total but the daily release rate is larger than anything Biden did, the largest daily draw in history. It has a real market impact. But here's the problem he kept hammering: releasing crude into a market where refineries are already running at maximum capacity does nothing for gasoline prices. The crisis since April has been in products. Diesel. Jet fuel. The three largest refineries in the Gulf, one in Kuwait, one in the UAE, one in Saudi Arabia, couldn't export anything during the initial disruption period. We lost the products. Adding crude to the system doesn't make more diesel if there's no refinery capacity to process it.

Alhajji's bigger point on refining is worth sitting with. He said flat out that if the US truly wants energy dominance, it needs to add at least 4 million barrels per day of new refining capacity. That probably means three or four new refineries, plus replacements for aging plants.

The refining sector has had an incredible run financially, just look at what Valero has reported in recent months. But the capacity gap is the part the energy dominance framing keeps skipping over.

The Four Seas Crisis, what the real map looks like

Alhajji coined the term Four Seas Crisis on this episode, and I want people to understand what that actually means, because the social media version of this conflict is almost entirely noise.

We have simultaneous disruptions in the Gulf (Hormuz), the Red Sea (Bab-el-Mandeb), the Black Sea, and now the Mediterranean after the drone strike on Egypt's LNG terminal and two regasification units. That's four seas at once. It has never happened before.

Then add the waterways nobody is talking about. The Panama Canal slowed down by low water levels. The Rhine River sitting at 30-40 centimeters, barges carrying fuel can't pass. French nuclear plants shut down because river water temperatures are too high for cooling, forcing a switch to oil-fired generation.

And Kazakhstan: Alhajji pointed out that Kazakhstan's pipeline exports were halted for the third time in a single month, losing 1.4 million barrels a day. Not a single senator said a word about it. Everyone was talking about Saudi Arabia, where the real crude losses were minimal.

The Saudi situation is actually a masterclass in how the narrative gets distorted. When the Jazan refinery was hit, people screamed about Saudi oil. But there's no crude production in southwestern Saudi Arabia. It's a refinery, not a wellhead. The Ghawar-adjacent Abqaiq facility in the eastern province was the real concern, as it was in 2019 when a strike caused a loss of 5.5 million barrels per day.

Alhajji told me some major accounts were literally posting the 2019 incident data as if it were current, because AI-generated content pulled the only available information and didn't know the difference. We had a physical crisis compounded by an information crisis.

Saudi Arabia has a workaround for Hormuz and Bab-el-Mandeb. Their VLCCs can't fit through the Suez Canal fully loaded, so the path runs through Ain al-Sukhna on the Red Sea coast, into the Sumed Pipeline across to the Mediterranean terminal at Sidi Qaya near Alexandria, with roughly 2.5 million barrels per day of pipeline capacity and approximately 22 million barrels of storage. By Alhajji's math, Saudi Arabia can technically export its full pre-crisis volume of around 6 million barrels per day through that system.

But then the ships have to go from the Mediterranean all the way around Africa to reach Asia. Run that out a few months and you hit a ceiling: all available tankers are in transit, and none are available to load. Production has to stop.

The attack on the Egyptian LNG terminal complicated even that workaround. The terminal is close enough to the Suez Canal that the question of whether the drones were aimed at the LNG infrastructure or were sending a message about the canal is genuinely open.

Products, not crude, why you're watching the wrong price

This is the part I think most people following this conflict have completely wrong.

After the initial phase of the crisis, the damage wasn't in crude. It was in products. Three massive Gulf refineries went offline for exports simultaneously. That triggered panic, and governments worldwide responded by restricting their own product exports. China imposed an outright ban on petroleum product exports. India put in heavy export taxes. South Korea set minimum thresholds before allowing any product to leave the country.

Then the hoarding started. If you're a trader holding physical diesel and you know prices are going up next week, the margin between this week and next week exceeds your storage cost, so you hold. Multiply that logic across the market and you have a cascade. Alhajji walked through a single shipment: India selling diesel to South Africa, the ship diverted to Singapore by a higher bid, then diverted again to China, then to Japan.

A cargo that should have been in Durban two weeks earlier was still floating. Multiply that by hundreds of ships and you have the picture.

The benchmark most people watch, WTI, told almost none of this story. WTI is a North American benchmark. The damage showed up in Dubai and Oman, the benchmarks that actually matter for Asian buyers. Alhajji said medium sour crude in Asia, by his reporting, traded above $170 per barrel, with some shipments approaching $200.

At $170, China stopped importing 6 million barrels per day. Japanese refiners, staring at oil priced in yen at the highest level ever recorded, chose to draw down inventories rather than buy. The demand destruction happened because prices went to places that made purchasing irrational, and that demand destruction is now baked in.

Alhajji made the point bluntly: you cannot kill the horse twice. The damage to Asian demand is done.

And even in the US, EIA data released the morning we recorded showed gasoline demand down nearly 2.5% year over year, with no EV penetration effect explaining it. The US was a demand-growth market. That 2.5% swing is significant.

Zelensky's campaign against Russian refinery infrastructure made this worse. Ukraine's sustained bombing of Russian refining and shipping infrastructure turned Russia from a product exporter into a product importer, pulling supply from the same Indian and Southeast Asian markets that were already being chased by panicked buyers.

Hormuz is about more than oil

I want people to understand what else runs through the Strait of Hormuz, because the obsession with crude price obscures the full picture.

Helium, you cannot manufacture a computer chip without it, and Qatar is one of the world's largest helium producers, exporting through Hormuz. Fertilizer inputs, without which food production costs explode. Methanol, required for biofuel production and dozens of industrial processes. Aluminum, which Alhajji noted hit record prices as a direct result of the disruption.

The fertilizer signal hit close to home. I had someone DM me this week saying a buddy of theirs works at a fertilizer facility in Louisiana, and the workers have been cut to 80% hours. The read from the floor is that it's extend-and-pretend before furloughs come, because input costs at that facility reportedly went from something like $400 to around $1,700.

They've started importing fertilizer from Morocco because domestic production has become uneconomic. That's an anecdote, not a data point, but it rhymes exactly with what Alhajji is describing at the macro level.

Alhajji gave his own on-the-ground number: he bought a new AC unit at the start of the crisis for $20,000. The same unit five months later is $26,000. That's 30% inflation on a single consumer durable, in the United States, from a supply chain shock that most price trackers haven't fully caught up to yet.

His characterization of the moment: we are only seeing the tip of the iceberg.

The LNG endgame, data centers versus export terminals

This is where the conversation went that I wasn't expecting, and I think it's the most underreported angle of the whole energy picture.

Alhajji covered in his Daily Energy Report the announcement of a $15 billion AI data center being built south of Dallas. A project at that scale has energy consumption that is, in his words, beyond imagination. They're building their own gas-fired power plant to power it. And when Alhajji worked the math backward, he found that within roughly two to three years, US LNG export terminals and US AI data centers will be competing for the same natural gas supply.

This isn't a hypothetical. The data center buildout is happening now, the LNG export capacity is being contracted now, and the domestic gas production that's supposed to feed both is finite. I've written about the protests already blocking data center buildout across 42 states, that's a real constraint on the supply side of the equation too. The gas fight Alhajji is describing is coming regardless.

Alhajji's investment conclusion on LNG has been consistent and is now reinforced by everything that's happened: American LNG names, held for 10 to 15 years, are among the best energy investments available. Not because of the current crisis premium, but because every country on earth is now rewriting its energy security policy through the lens of what Hormuz just demonstrated. National security framing will drive subsidies, tax breaks, and government-backed contracts that commercial logic alone would never produce.

He added storage batteries to that list for the same reason. Solar and wind subsidies will continue and expand, not because of climate policy, but because politicians can now justify them as national security infrastructure. Nobody argues with national security appropriations the way they argue with climate spending. The framing shift is already happening.

On coal: Alhajji said Hormuz saved coal. Countries that were phasing it out are now holding it as strategic reserve generation. That's not reversing; it's staying. Natural gas remains the long-term future, nuclear is the only other reliable baseload for AI-scale power demands, and all those data centers have diesel backup, which is a detail that should tell you something about where the real reliability hierarchy sits, whatever the press releases say about renewables.

Venezuela's ceiling and the lessons nobody learned

Alhajji was blunt about Venezuela: they've hit their ceiling at roughly 1.1 to 1.2 million barrels per day of exports, and getting above that requires at minimum three years and significant investment that isn't flowing yet.

The laws were changed too quickly. That's his core critique. The Trump administration and the new Venezuelan government moved fast to open the door for US companies to return, but speed created a legal mismatch. Individual provisions conflict with each other.

And more importantly: any future government can declare those changes void on the grounds that they were made under duress with foreign military presence in the country. The Venezuelan people haven't seen the benefits of the transition yet. An explosive situation remains explosive.

The engineer problem is real and underappreciated. Venezuela's best petroleum engineers left years ago for Aramco, ADNOC, BP, TotalEnergies. They're earning international salaries, Alhajji put the figure at around $250,000 a year. You're not getting them back for $40,000 to $50,000.

If you pay them international rates, the "cheap Venezuelan production" math changes fundamentally. If you don't, you're depending on American engineers, who are the most expensive in the world.

Alhajji used Iran as the parallel case. When Trump eased sanctions on Iran and said Iran could sell oil freely for US dollars, it didn't work. The ships that carry Iranian oil were individually sanctioned. No port would accept them regardless of the broader sanctions relief. Iran remained outside the SWIFT system, so payment was impossible.

The policy said one thing; the infrastructure for executing it didn't exist. Venezuela is running the same mismatch right now.

What to watch, what to own

I asked Alhajji for a 30-to-90-day outlook, and he didn't sugarcoat it. His published summary on this, which he offered to share outside his paywall, frames it plainly: we are in deep trouble. Saudi Arabia posted -4.5% GDP growth in the period after an earlier +3% quarter.

The Gulf states, Saudi Arabia, UAE, Qatar, Kuwait, Iraq, are heavy importers, heavy consumers, and the primary donors to developing-world aid programs. All of that spending is compressed or gone. Q2 global economic data hasn't fully landed yet, but the trajectory is visible.

Fifteen events around the world are simultaneously bullish for energy supply constraints, by Alhajji's count. That doesn't mean oil prices go to the moon, it means economies self-destruct before prices get there. Demand destruction sets the ceiling.

On the geopolitical read: I pushed Alhajji on whether this is all coordinated strategy or reactive chaos. He was careful about it. He doesn't want to sound conspiratorial. But his point is structural: moving US LNG share in European gas from 0% to 30% doesn't happen by accident. The ships, contracts, terminals, and diplomatic groundwork for that took years and multiple administrations.

The NSS just codified what was already in motion. And the plan's execution being messy doesn't mean there was no plan.

I'll say what I said on tape: the NSS document was explicit about stopping Middle Eastern military excursions and focusing on the Western Hemisphere. Starting a war in Iran three months later is either a contradiction of the stated strategy or the stated strategy was always a partial picture. I don't think it was reactive. I think drone warfare introduces enough asymmetric chaos that even well-laid plans get complicated, and the drones going from Ukraine to Russian refineries, or from Yemen toward Saudi tankers, are already reshaping what conventional naval doctrine means in this theater.

The nationalization comment Alhajji floated at the end stuck with me. He said the fear is energy sector nationalization spreading to the West. I cut him off: it's already happening. AI infrastructure, rare earth supply chains, strategic minerals, the government equity-and-subsidy model is already the operating framework.

Energy is next. The SPR is just the visible version of a much larger posture that's about to get more explicit.

In a world where central bankers are tripping over themselves to devalue their currency, and governments are nationalizing the commanding heights of the energy and AI economy, a fixed-supply asset that no government can print or seize is the only logical conclusion.

About Anas Alhajji

Anas Alhajji is an independent energy economist and the author of the Daily Energy Report, where he covers global oil, gas, and LNG markets for institutional subscribers. He has held research and advisory roles at energy companies and academic institutions and is widely cited in energy policy discussions. He has appeared on TFTC multiple times, with a particular focus on geopolitical risk in energy markets, LNG trade flows, and the structural dynamics of global petroleum product markets. His prior appearance on the show addressed Iran's nuclear standoff and the limits of sanctions on Iranian oil exports.

Sources mentioned

• Jones Act Waiver Exposes 100 Years of Hidden Energy Tax (TFTC): background on US domestic energy policy constraints and refinery dynamics
• 142 Protests in 42 States Signal Hard Ceiling on AI Data Center Buildout (TFTC): the real-world resistance to data center expansion that compounds the gas supply competition Alhajji describes
• Gulf Bond Boom Hits Record $30B as States Borrow to Escape Hormuz (TFTC): Gulf state financial response to the Hormuz disruption
• Iran Orders Houthis to Seal Bab el-Mandeb if Trump Bombs Power Grid (TFTC): the Bab-el-Mandeb threat chain Alhajji references
• Smotrich: US Fighting Iran Is 'Best for Us' While 18 Americans Die (TFTC): the political context around the Iran conflict Marty flags when discussing the NSS strategy contradiction
• Iran Ditched GPS for China's BeiDou, and US Infrastructure Influence Is Paying the Price (TFTC): the parallel story of US influence eroding in the region
• Trump's Saudi Nuclear Deal Bypasses IAEA Safeguards (TFTC): the broader US-Gulf energy and security architecture Alhajji references

Watch the conversation

Timestamps

• 0:07 - Bitcoin wins in a world of currency debasement
• 6:32 - Is this war really about Iran's nuclear program?
• 10:16 - The National Security Strategy, energy dominance, and the big picture
• 15:28 - SPR releases, products vs. crude, and the diesel hoarding cascade
• 28:30 - The Four Seas Crisis and the Kazakhstan story nobody covered
• 42:00 - The Sumed Pipeline workaround and its ship-availability ceiling
• 51:00 - Hormuz beyond oil: helium, fertilizer, aluminum, and your AC unit
• 58:00 - LNG endgame: data centers vs. export terminals
• 1:05:00 - Venezuela's ceiling and the legal mismatch problem
• 1:12:00 - What to watch, what to own, and the nationalization fear

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