Sunday, October 8, 2017

Kent Moors — The Geopolitical Consequences Of U.S. Oil Exports

Two crucial things happened yesterday.
The first you may have noticed – oil prices moved back up.
As for the second, most so-called “experts” seemed to have missed.

See, the environment we’re seeing in energy markets is very different from what we saw only a week ago, when oil prices were also rising.
Because yesterday also saw – for the first time in world history – a reigning Saudi Arabian monarch in Moscow for talks with Russia’s head of state.
Historically, Russia has been much closer to Iran – Saudi Arabia’s main regional enemy.…
The advantage to American producers is simple. Exporting oil that costs less to produce at home into markets were the oil price is higher is a direct route to improving bottom lines.
As long as this situation remains, there will be additional U.S. production coming, because it’s profitable to extract and export.
And the more U.S. oil is exported, the less immediate effect higher production here has on domestic prices.
But this is also resulting in changes to foreign expectations. Some of these are having spillover effects in other quarters…
Including sending Saudi Arabia and Russia into each other’s arms…
Why did the Saudi king visit Russia personally. It's the only way that he and Putin could guarantee a secure conversation. No doubt US intelligence is wondering what they said to each others and agreed upon.

1 comment:

Footsoldier said...

Here's your answer Tom


The Saudi's are putting their prices up and cutting production