Oil prices rise on drop in US crude stocks, refinery outage
Oil prices rose on Wednesday, buoyed by an outage at a major refinery on the U.S. East Coast and industry data that showed U.S. crude stockpiles fell more than expected. Philadelphia Energy Solutions is expected to seek to permanently shut its oil refinery in the city after a massive fire caused substantial damage to the complex, two sources familiar with the plans said on Tuesday. “Oil is up in reaction to the API data combined with the refinery disruption on the U.S. East Coast. Gasoline is up and leading the complex and helping to keep momentum up on crude,” Olivier Jakob of Petromatrix consultancy in Switzerland said. Click here to read more from CNBC.
Bank of America Sees Risk of $30 Oil If China Devalues Yuan
A further deterioration in relations between the U.S. and China could set off a chain of events that would push oil down more than 50% to as low $30 a barrel, according to Bank of America Merrill Lynch. President Donald Trump may decide to raise tariffs on the remaining $300 billion of Chinese imports if he doesn’t like what he hears from Chinese President Xi Jinping at this weekend’s G-20 summit in Osaka, Francisco Blanch, the bank’s global head of commodities, said in an interview in Singapore. That may cause Chinese authorities to let the yuan weaken, making oil that’s priced in dollars more expensive in the world’s largest importer and stunting demand growth, he said. Beijing might also decide to ignore Washington’s sanctions against Iran and resume crude imports from the Persian Gulf country, Blanch said. Click here to read more from Bloomberg.
The Next Oil Crisis Could Find Us Very Unprepared
Most people think of an oil crisis as a major loss of oil supply from some political event which creates a shortage, leading to gasoline lines, a scramble for supplies, and soaring prices. Such has not really occurred since 1979, leading to a fair amount of complacency; as the recent tanker attacks in the Persian Gulf resulted in a minor blip in oil prices. Many pointed to the 1980s Tanker War between Iran and Iraq, which had no noticeable effect on prices as informative. The 1979 Iranian Revolution saw not just a huge surge in prices, but massive upheaval in the industry’s structure. Within a couple of years, not only had prices tripled, but the dominant role of the Seven Sisters (BP, Chevron, Exxon, Gulf, Mobil, Shell and Texaco) was greatly diminished. Click here to read more from Forbes.
These experts think oil demand won’t peak until 2035
Global oil demand is likely to keep rising for at least another 15 years before Asia’s fast-growing economies catch up to the shift from hydrocarbons to electric power, a leading consultancy said on Monday. “At some point in the next 20 years, it’s likely we’re going to see oil demand peak. Our own view at Wood Mackenzie, is around 2035, 2036,” Wood Mackenzie chairman Simon Flowers said in an interview with CNN Business. Click here to read more from CNN.