“Old Economy Is Taking Revenge”: Jeff Currie Warns Fuel Squeeze Is Driving Structural Inflation

Former Goldman Sachs commodities chief and current Real Macro head Jeff Currie joined CNBC earlier Thursday to discuss all things commodities, warning that the latest Brent crude rally above $107 a barrel is becoming harder to dismiss as a temporary shock, with renewed Chinese buying and soaring refining margins (US diesel crack spread now $110 a barrel) signaling deeper pressure across physical commodity markets.

Currie warned that traders are underestimating an inflation cycle driven by years of underinvestment in the capacity to produce and deliver essential raw materials, echoing his summer warnings about scarcity in physical markets.

“The old economy is taking its revenge,” Currie said. “You see it in the rates markets. You see it in the commodity markets.”

Asked whether the latest flare-up in the Gulf conflict explained the jump in Brent crude this week, Currie pointed first to demand returning from Asia (read here). 

“Actually, I put a bigger weight on China coming back to the market,” he said, citing strong buying interest after returning from Singapore and Hong Kong.

China had contributed to the refined-product squeeze by reducing refinery operations and exports as access to crude tightened earlier this summer, Currie explained. But exceptionally high diesel margins created a massive incentive to restart those those refineries, bringing renewed crude demand into an already strained market.

He cited diesel crack spreads of $110 a barrel, exceeding the price of crude itself. That figure refers to the refining spread, rather than the outright diesel price.

“That’s a pretty big profit,” Currie said. “They start chasing it, brought those refineries back online, and it was just like an earthquake going through here.”

The rally in Brent is showing signs of greater staying power, he pointed out, with equities and longer-dated oil prices beginning to reflect a more persistent disruption.

“People are starting to go, ‘This is not transient,’” Currie said. “It has a different flavor to it.”

Thank you to @KellyCNBC and the @CNBCTheExchange team for having me on today.

The old economy is taking its revenge.

We are dealing with higher structural inflation after years of underinvestment in the ability to supply and deliver hard assets.

There are two trades happening…

— Jeffrey Currie ++ (@CommodMkt) September 10, 2026

Complimenting Currie’s bull thesis on commodities, HSBC chief economist for global commodities Paul Bloxh warned in a note this week that a “super-squeeze” has begun (read report).