Three charts tell the story.
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| Trump's pro-oil policies are causing a surge in US exports that will continue for the foreseeable future. |
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| This is causing oil prices to go down. They are down 20% since the start of the year. |
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| Russia gets its money from oil and derivatives. Plenty of Russian fatcats are going to get crushed in the next four years. |
Meanwhile, some in the news media and plenty of pundits and celebrities are still shrieking about Trump collaborating with the Russians. It's completely insane. In order to believe that, you'd have to believe that the Russians hate money.
I'm not sure that makes a lot of sense. US production of crude peaked under Obama in 2015. What has changed is that we now allow exports of US light sweet crude, which is easier to refine. This used to be forbidden, but the rules changed, again under Obama. The US has refineries that can work with thicker crude that comes from Canada and Mexico. The US exporting oil isn't going to affect global oil supplies, we are still big net importers of oil overall.
ReplyDeleteOil production is lower now because prices have dropped below where a lot of the fracking that was taking place no longer makes economic sense.
Oh, noes! He *is* the second coming of Reagan!
ReplyDeleteThe drop in the oil prices is the key part. That's what's killing the Russkies. Take a look at their markets. If I recall correctly, since Trump's election, the Russian MICEX index is the worst-performing stock index in the world, down about 13%.
ReplyDeleteAs for peak production, you're right that fracking during Obama caused much growth, but I would argue that Trump's much more sympathetic policies will make it easier and cheaper. Those oil prices are going to remain low and that spells trouble for Russia.