Sophisse

Crude Oil Seeks Iranian Black Swan

I definitely agree that black swan thinking applies to oil pricing. With spare supply capacity at an extreme low, oil is very vulnerable to negative swans (black or grey). And unfortunately, it is very easy to imagine a variety of negative events, so easy that when you put them all together there is a material chance of at least one of them happening.

On the flip side, it is definitely possible to imagine a large positive black swan like a huge oil discovery somewhere. But the asymmetry is, the negative events can stop oil flowing overnight, whereas the positive ones start oil flowing after 3-6 years.