Idle Rambling -- Not Ready For Prime Time -- June 15, 2018

Updates

June 18, 2018: update of Venezuela exports. But this is the scary thing in the graphic below. Look at where the US Gulf Coast imports come from: Saudi Arabia; Mexico; Iraq; Canada; Venezuela -- none of them are very reliable any more, all for different reasons:

Original Post

 

I did not watch any television today except for the US Open (golf).

I have no idea what the talking heads said about what the price of oil did today.

All I know is this:

• Venezuela is importing heavy oil to meet demands of its one large refinery. Analysts suggest it is unlikely Venezuela will "turn around" any time quickly.
• WTI and Brent have an "awful" day. WTI falls almost 2.75%, loses $1.83, falling below $65/bbl, before closing at $65.06. Brent does even worse, falling more than 3.25%, losing $2.50/bbl, and closing at $73.44.

So, all that talk about how important Libyan oil is. All that talk about how important Iranian oil is. All that talk about how important Iraqi oil is. All that talk about how important Canadian oil is. All that talk about how important Venezuelan oil is. What a bunch of hogwash. Did I mention Brazil? Norway? North Sea?

The country with the largest oil reserves in the world. A huge exporter of heavy oil. And now it's importing oil to run its refineries. Venezuela.

And the price of WTI and Brent plummets.

I assume I'm missing something and the talking heads have all kinds of explanations for the fall in the price of oil today, but to me it certainly looks like the only three oil-producing countries that matter: Saudi Arabia, the US, and Putin.

On top of that, I read somewhere on the "internets" that China is going to increase tariffs on oil, natural gas, and refined products coming out of the US. That certainly suggests to me there is no shortage of oil. Or maybe there is and China is simply trying to get ahead of the curve by raising the price of gasoline for their citizens so they switch over to EVs.

Idle chatter. Not ready for prime time.