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-produc
