U.S. ‘’Oil Weapon’’ Could Change Geopolitics Forever

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In a dynamic that shows just how far U.S. oil production has come in recent years, the U.S. Energy Information Administration (EIA) said on Monday that in the last two months of 2018, the U.S. Gulf Coast exported more crude oil than it imported. Continue reading

OPEC Threatens To Kill U.S. Shale

 

The Organization of Petroleum Exporting Countries will once again become a nemesis for U.S. shale if the U.S. Congress passes a bill dubbed NOPEC, or No Oil Producing and Exporting Cartels Act, Bloomberg reported this week, citing sources present at a meeting between a senior OPEC official and U.S. bankers.

The oil minister of the UAE, Suhail al-Mazrouei, reportedly told lenders at the meeting that if the bill was made into law that made OPEC members liable to U.S. anti-cartel legislation, the group, which is to all intents and purposes indeed a cartel, would break up and every member would boost production to its maximum. Continue reading

U.S. Supermajors Could Form A New Oil Cartel

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The ambitious shale growth plans of the U.S. supermajors could in the future allow them to control so much of U.S. shale oil production that they could also control the price of the U.S. light tight oil going to foreign markets in an ‘OPEC of their own kind,’ Investing.com quoted John Kilduff, founding partner at Again Capital, as saying. Continue reading

Robert Rapier on the End of OPEC and Rise of Electric Vehicles

In a recent interview with Financial Sense’s Jim Puplava, energy expert Robert Rapier explained why he thinks OPEC (the Organization of Petroleum Exporting Countries) is headed for trouble and what the increased popularity of electric vehicles will do to oil markets. It’s only a matter of time before the markets are hit by the wave of newer cleaner energy. Rapier walked us through what this could look like for OPEC and how other countries and companies are tackling the issue. Continue reading

U.S. oil output to surpass Saudi and Russia combined by 2025

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Driven by a continued shale boom, the United States is on track to produce more crude oil and liquids than Russia and Saudi Arabia combined by 2025, an energy consultancy said. Continue reading

What Would The End Of OPEC Mean?

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The Organization of the Petroleum Exporting Countries – the oil market institution that has exerted an unyielding power over the price of crude for nearly 60 years – is now in deep crisis. The latest OPEC meeting in Vienna offered new insights into the cartel’s raging civil war that is tearing it apart and threatens to ultimately make the cartel irrelevant.

In a two-year period since the group of 15 major oil producers formed an alliance with Russia, OPEC’s smaller members have been marginalized, their voices have been diminished and Saudi Arabia seems to prioritize its partnership with Moscow above all else. An unlikely partnership between Saudi Arabia and Russia is causing dissension within OPEC, with one of the oldest members announcing it would withdraw from the organization in January just days prior to the talks. With Russia tightening its grip over OPEC’s decisions and the United States officially reaching net oil exporting status in late November for the first time in decades, even if only briefly, the new world oil order is now dependent on three energy superpowers: Saudi Arabia, Russia and the United States. Continue reading

The Biggest Threat To Dollar Dominance

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Russian oil exporters are pressuring Western commodity traders to pay for Russian crude in euros and not dollars as Washington prepares more sanctions for the 2014 annexation of Crimea by Moscow, Reuters reported last week, citing as many as seven industry sources.

While it may have come as a surprise to the traders, who, Reuters said, were not too happy about it, the Russian companies’ move was to be expected as the Trump administration pursues a foreign policy where sanctions feature prominently. This approach, however, could undermine the dominance of the U.S. dollar as the global oil trade currency. Continue reading

Saudi Arabia Calls The End Of Russia’s Oil Prowess

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Saudi Arabia has not only called the end of Russia’s prominence as a global oil behemoth, but anticipates that Russia’s oil exports “will have declined heavily if not disappeared” within the next 19 years, Mohammed bin Salman said in a recent interview with Bloomberg. Continue reading

A New Era Of Geopolitical Risk In Global Oil Markets

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Amid never ending talk and speculation over how many more barrels of Iranian oil will be removed from global markets once sanctions slated to hit Iran’s oil production on November 6 take effect, some are claiming that geopolitical factors have driven the market just as much as supply fundamentals.

At Russia Energy Week in Moscow last week, both Saudi and Russian energy ministers said they see rising geopolitical risk as driving the recent oil price increase at a time when there is sufficient supply in the market. Of course, the notion of sufficient supply will be tested soon, as will both Saudi Arabia’s and OPEC’s spare production capacity will be called on to maintain this supply. Continue reading

Trump To Saudi King: “You Wouldn’t Last Two Weeks Without Us”

 

One week after President Trump accused Saudi Arabia of deliberately conspiring to drive up oil prices during his speech before the United Nations General Assembly, the president stepped up his rhetoric against America’s most important strategic ally in the Middle East during a rally in Southaven Mississippi Tuesday night, implying that the US could withdraw the military protection it provides to the kingdom and warning that the Saudi regime that it wouldn’t survive for “two weeks” without US support. Continue reading

Iran Threatens Gulf Oil Producers

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(Photo Credit: Asharq al-Awsat English Archive)

 

Wednesday, while most Americans were otherwise preoccupied with the Independence Day holiday, Iranian President Hassan Rouhani threatened an open act of war against his neighbors:

“The Americans have claimed they want to completely stop Iran’s oil exports. They don’t understand the meaning of this statement, because it has no meaning for Iranian oil not to be exported, while the region’s oil is exported. The Americans say they want to reduce Iranian oil exports to zero… It shows they have not thought about its consequences.” Continue reading

Trump To OPEC ‘Allies’: “Reduce Oil Prices Now” Or Lose US Defense Shield

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Update: For the umpteenth time this year, President Trump has lashed out at OPEC over soaring oil prices (and therefore gas prices): “The OPEC Monopoly must remember that gas prices are up & they are doing little to help. If anything, they are driving prices higher.”

Then Trump escalated his rhetoric, appearing to threaten the withdrawal of support unless action is taken “…the United States defends many of their members for very little $’s. This must be a two way street. REDUCE PRICING NOW! “

This is coming after reports that Trump asked the Saudis to increase production by 2mm barrels and that they agreed.

President Trump has not been shy of expressing his views to OPEC… Continue reading

China and India Establish “Oil Buyers’ Club” to Counter OPEC

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On June 11, major Chinese and Indian oil companies started a formal meeting in Beijing, discussing the establishment of an “oil buyers’ club” to negotiate better prices with OPEC countries. The chairman of China’s biggest energy company China National Petroleum Corporation (CNPC), Wang Yilin, and the chairman of refiner Indian Oil Corporation both attended the meeting. According to the India Times, the two largest energy consumers together accounted for almost 17% of world oil consumption last year. Should this “oil buyers’ club” become a reality, New Delhi, and Beijing will have greater leverage to negotiate with OPEC about oil prices and will also have a significant say in matters such as importing more crude oil from the US. Continue reading

OPEC Has Regained Its Grip On Oil Markets

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Higher oil prices seem to have given OPEC the confidence that it needs to begin thinking about moving forward, and with Russia in the mix as well, it appears as though the alliance will be a force to be reckoned with.

– Gasoline prices averaged $2.92 per gallon for the week ending on May 21, and have surpassed $3 per gallon in regional markets.

– The prices are the highest for the Memorial Day weekend in four years.

– However, prices are likely to fall back soon with crude oil prices plunging over the past week. Continue reading

Another Step Towards Collapse of Petrodollar

Note: Please see the source for currency swap agreements chart.

 

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For the past year and half a major topic throughout the alternative press has been the new Chinese oil futures contract settled/priced in yuan. The fact that China is directly challenging the Federal Reserve Note, U.S. dollar, is quiet a significant change. For those that have been paying attention this new futures oil contract is nothing more than the next step in China moving completely away from the Federal Reserve Note, and the “world reserve currency” system and towards a multi-polar world with several currencies being used for international trade. Continue reading