RE:What's the impact of this on crude? OK lets try this short term vs. long term TLV paradigm here:
Short term (1-2 years) : Additiional supply, limited bearish impact on crude price.
Long term (2 + years) : Neutral, as increased theoretical Venezualen supply curve meets reality based global reservoir depletion curves. Saudi Arabia / OPEC remain price setters IMO.
So why would Biden administration deal with an unsavory dictator in South America vs. Canada?
I simply do not know, I have to assume it is one more short term panic decision that the Biden admin is famous for at this point. Turns out not only investors struggle with short term decision issues. Look at the foolish decisions in the Biden admin, it is a laundry list of what NOT to do, or a MASTER CLASS IN INVERSIONISM (If that is really a word :-)
1. Biden cancelled Keystone day 1 of his presidency.
Why: In part to appease the environmental crowd, but mainly to help a wealthy democrat donor that owns a railroad. "Pipelines are the biggest threat to railroads"
2. Two years later he squandered the bulk of heavy crude in the Startegic Petroleum Reserve.
Why: to lower prices at the U.S. pumps to help sway mid term elections.
3. Biden admin drove the Russians into the orbit of the Chinese communist party.
Why: So the corrupt uni-party in Wahington DC could continue grifting on epic corrupt spending for Ukraines corrupt Uni-party.
Short term these ideas have some merit (assuming you are short on wisdom and morality)
Long term these ideas have damaged the US republic in numerous ways.
A bit off topic, but putting on my custom "Tin Foil Hat", sometimes it seems like the Biden admin is setting up the United States for a multi-polar world a decade from now, where the United States controls all oil reserves in North and South America. Meanwhile, China / Russia / Saudi Arabia dance a triple Tango controlling resouces on the east side of the globe.
Sounds a bit silly, but at least it would explain some of Bidens blunders with Keystone, essentially saving Canadian reserves for the end of the oil age. Upon further reflection, I have to assume the simplest answer, the Biden administration is being controlled by short term thinkers that lack wisdom.
Cheers,
Nukester
Welcome back TLV if you read this far :-)