$300 oil continued A few weeks ago I raised the question - what would $300 oil mean for OBE
It seems we are getting to see what low $80 means
This seems to be the threshold that Biden starts interfering
Presently he is trying to talk oil from moving higher
He can release some oil from the US strategic reserve. They have been dining that. Yesterday's report showed about 3 million barrels had been released in the most recent week - that's close to 500,000 day
A much bigger concern would be if exporting oil or refined products was banned
That wouldn't change global demand. It would have implications for Canadian producers.
Canada exports oil to the US, which refines it, and exports some of that
if the US can't export - what does that mean for Canadian exports to the US? Would it only affect heavy oil?
Canada is about a year away from getting another 400,000 barrel access to the BC coast for export - taking transmountain pipe capacity to 800,000 boe ish
it would have major impacts on the Canadian economy. Vancouver airport for example gets about half its jet fuel from Washington state. Without US exports of jet fuel, Vancouver airport would be half closed.
Covid has shown how Countries like the US put their interests first.
How exposed is OBE to a ban on US export of oil OR refined products
Oil export ban alone may do little - the oil will get refined and exported as jet fuel, gasoline, deisel etc
A US export ban on refined products would affect the Canadian economy. What impact would it have on the price OBE gets for its products?
The world is entering an energy crisis - the price affects started to appear in July - first in Natural gas and coal in Asia and Europe. That means higher prices in places where there are shortages. But what does that mean for OBEs gross sales?
A US strategic reserve release will likely do little other than short term price turbulence
A US oil export ban may also do little to lower prices - but it may cut exposure to global price increases
A US export ban on refined products would do something - hard to predict what. It could be disruptive