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  1. #1
    Senior Member Captainron's Avatar
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    Trump's revenge: U.S. oil floods Europe, hurting OPEC and Russia

    Trump's revenge: U.S. oil floods Europe, hurting OPEC and Russia


    FILE PHOTO: A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma September 15, 2015. REUTERS/Nick Oxford/File PhotoBy Olga Yagova and Libby George
    MOSCOW/LONDON (Reuters) - As OPEC's efforts to balance the oil market bear fruit, U.S. producers are reaping the benefits - and flooding Europe with a record amount of crude.
    Russia paired with the Organization of the Petroleum Exporting Countries last year in cutting oil output jointly by 1.8 million barrels per day (bpd), a deal they say has largely rebalanced the market and one that has helped elevate benchmark Brent prices close to four-year highs.
    Now, the relatively high prices brought about by that pact, coupled with surging U.S. output, are making it harder to sell Russian, Nigerian and other oil grades in Europe, traders said.
    "U.S. oil is on offer everywhere," said a trader with a Mediterranean refiner, who regularly buys Russian and Caspian Sea crude and has recently started purchasing U.S. oil. "It puts local grades under a lot of pressure."
    U.S. oil output is expected to hit 10.7 million bpd this year, rivaling that of top producers Russia and Saudi Arabia.
    In April, U.S. supplies to Europe are set to reach an all-time high of roughly 550,000 bpd (around 2.2 million tonnes), according to the Thomson Reuters Eikon trade flows monitor.
    (GRAPHIC: U.S. crude oil and condensate supply to Europe - https://reut.rs/2F8xk0k)
    In January-April, U.S. supplies jumped four-fold year-on-year to 6.8 million tonnes, or 68 large Aframax tankers, according to the same data.
    Trade sources said U.S. flows to Europe would keep rising, with U.S. barrels increasingly finding homes in foreign refineries, often at the expense of oil from OPEC or Russia.
    In 2017, Europe took roughly 7 percent of U.S. crude exports, Reuters data showed, but the proportion has already risen to roughly 12 percent this year.
    Top destinations include Britain, Italy and the Netherlands, with traders pointing to large imports by BP, Exxon Mobil and Valero.
    (GRAPHIC: U.S. crude oil and condensate supplies to Europe in 2017-2018 by destination - https://reut.rs/2F9lWRO)
    Polish refiners PKN Orlen and Grupa Lotos and Norway's Statoil are sampling U.S. grades, while other new buyers are likely, David Wech of Vienna-based JBC Energy consultancy said.
    "There are a number of customers who still may test U.S. crude oil," Wech said.
    The gains for U.S. suppliers could come as a welcome development for U.S. President Donald Trump, who accused OPEC on Friday of "artificially" boosting oil prices.
    "Looks like OPEC is at it again. With record amounts of Oil all over the place, including the fully loaded ships at sea. Oil prices are artificially Very High! No good and will not be accepted!" Trump wrote on Twitter.

    'KEY SUPPLY SOURCE'
    While the United States lifted its oil export ban in late 2015, the move took time to gain traction among Europe's traditional refineries, which were slow to diversify away from crude from the North Sea, West Africa and the Caspian.
    "European refiners started experimenting with U.S. crude last year," said Ehsan Ul-Haq, director of London-based consultancy Resource Economics. "Now, they know more than enough to process this crude."
    U.S. oil gained in popularity, sources said, in part because of the wide gap between West Texas Intermediate, the U.S. benchmark, and dated Brent, which is more expensive and sets the price for most of the world's crude grades.
    This gap, known as the Brent/WTI spread, has averaged $4.46 per barrel this year, nearly twice as high as the year-earlier figure, Reuters data showed.
    Wech of JBC Energy said the spread would likely persist in the near future.
    The most popular U.S. grades in Europe are WTI, Light Louisiana Sweet, Eagle Ford, Bakken and Mars.
    Prices for alternative local grades have been slashed as a result.
    CPC Blend differentials recently hit a six-year low versus dated Brent at minus $2 a barrel. Russia's Urals also came under pressure despite the end of seasonal refinery maintenance.
    WTI was available at 80-90 cent premiums delivered to Italy's Augusta, well below offers of Azeri BTC at a premium of $1.60 a barrel, according to trading sources.
    U.S. oil is even edging out North Sea Forties, which is produced in the backyard of the continent's refineries.
    Cargoes of WTI were offered in Rotterdam at premiums of around 50-60 cents a barrel above dated Brent, cheaper than Forties' premium of 75 cents to dated.
    (Additional reporting by Julia Payne and Devika Krishna Kumar; Editing by Dale Hudson)
    https://www.yahoo.com/finance/news/t...--finance.html









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    Senior Member Judy's Avatar
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    It'a amazing the things this President is accomplishing in such a short period of time on so many fronts.
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    MW
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    Quote Originally Posted by Judy View Post


    It'a amazing the things this President is accomplishing in such a short period of time on so many fronts.
    Exactly how is this helping the American consumer? Sure, it's benefiting the oil companies but it isn't helping folks like you and me at the pump. For anyone paying attention, gas prices have been rising steadily. American oil should be kept here to benefit our consumers, not shipped to Europe or Asia to help boost oil company profits! Never discount the greed of big oil. This necessary but evil component of American business has never placed the needs and wishes of the American people above profits.

    This is not an accomplishment!



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    Senior Member Judy's Avatar
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    Trump didn't lift the ban on crude exports. Obama did that in 2015. Blame him.

    Trump is increasing the supply which helps keep the price lower than it would be otherwise. Trump hates OPEC because he thinks they're a cartel-based monopoly and operate in violation of our Sherman Anti-Trust laws that forbid such activity, and he's right.

    Oil exports bring in payments from other countries for oil purchases and that increases our GDP and cash payments into our economy and reduces trade deficits, which helps every American Worker and every American Consumer.

    Gas prices are going up in part because the economy is going up and our demand is higher but also because crude prices went up when OPEC deliberately reduced their production to raise the price of crude, but also because with the increased economic activity, we may need another gas refinery or expansion of one to come on line, and I think there is one or two out there. So gas prices in the US are determined by the economy, world oil supply and domestic gas refinery capacity.

    Trump is going knock OPEC cartel out of business. That's his goal, and when he does that, world crude oil prices will no longer manipulated by them which benefits our country and consumers.
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