EL7.AI
Commodities•20 July 2026•
1 min read

Crude Oil Surplus Warning: Refining Crunch Pressures ETFs Like USO and BNO

Key Facts

1Veteran trader Baron Lamarre warned against buying crude oil ETFs like USO and BNO due to the ongoing refining crunch.
2Analysts expect a temporary crude surplus resulting from global refining capacity constraints.

Amid shifting energy market dynamics and supply chain disruptions, veteran trader Baron Lamarre has issued a warning against purchasing crude oil ETFs such as USO and BNO. According to reports, this caution stems from an ongoing refining crunch that has led to a temporary surplus of unprocessed crude oil. Analysts expect this bottleneck in global refining capacity to maintain downward pressure on crude-linked instruments until processing facilities can catch up with supply.

This outlook aligns with broader sector trends where refining margins have come under significant pressure. Per market data and industry reports from the IEA, global refinery throughput has struggled with rising operational costs and aging infrastructure. Peer comparisons show that integrated energy giants like ExxonMobil and Chevron have navigated similar headwinds in their downstream segments, suggesting that a crude surplus may lead to inventory builds rather than immediate price relief for refined products.

On the macro front, the API Crude Oil Stock Change reported on July 14, 2026, showed a marginal decline of -0.056 million barrels, significantly missing the forecast of a -2.7 million barrel draw. This data point reinforces the narrative of a developing supply overhang that could weigh on crude prices in the near term.