created: 15 Apr 2014 06:09
tags: exports pipelines refinery usa
I have dealt with the commercial issues surrounding the ban on exports of American crude oil but I think there is another way of looking at the issue as well, ethical considerations.
One thing that always strikes me when I discuss the Middle East with people in Noth America is how easy it is to be hawkish from 10,000 miles away. When sanctions on Iran are discussed in Washington, there are no commercial implications. in Brussels, however, there are. European refineries have lost huge sums of money due to the banning of Iranian crude. The biggest winner has been Russia, who has seen their discounts reduce to nothing.
It is possible that Russia is next in line for sanctions, and once again European companies will bear the brunt of them.
Meanwhile in a parallel universe on the other side of the Atlantic, our alleged ally refuses to sell us their crude oil, even though they have too much. Instead of the champion of freedom that we were always told that America is, they are running a beggar thy neighbour policy, and one that probably even harms themselves.
The USA already has an image problem and this just reinforces the view that it doesn't care about its allies.
So whilst I will agree with any American that thinks European leaders have a tendency to be lily livered, from where we are standing, we are being asked to be tough, and to also pay all of the bill.
created: 02 Apr 2014 07:10
tags: pipeline usa wti
Since 2009, the massive changes being brought about by growing production of oil sands crude, tight oil and shale gas associated liquids, have meant that Cushing, the centre of the USA's crude inventories has been oversupplied with oil, and the pipelines emptying it have been insufficient.
The result of this has of course been that WTI, the US crude benchmark and Brent, the North Sea based global benchmark have been out of sync. The impact of this has been huge, Shale Oil Impact on both sides of the World talks about some winners, whilst Why Nigeria is Losing from US Tight Oil discusses one of the losers.
However, according to the EIA, crude oil stocks are down 32% over the past two months. So we finally have, albeit probably temporarily, a solution to our WTI "problem". It is not a surprise it is thanks to a couple of pipeline projects, first the Seaway Crude Oil Pipeline was reversed and expanded, secondly the first section of the Keystone XL Pipeline Project was recently completed.
Just as the impact of too much US crude was felt world wide, The Impact of Keystone XL on Global Oil Markets is going to be big as well.
created: 16 Feb 2014 11:24
tags: refinery usa valero