The Rise Of U.S Oil Export

The Rise Of U.S Oil Export

OilWe could expect prices descending under $60 a barrel as U.S shipment to Asia impede to weakened a deal between OPEC and its allies.

As U.S. continues to increase their production, so is their export to Asia. It was a traditional stronghold for OPEC. With the failure of OPEC to dominate the market, it has open the doors for the U.S to gain shares of the covet Asian market.

It could prompt other nations to increase their supplies, the result could impact the crude prices. The longer the agreement OPEC has with other producers to keep production down, the least impact they will have on the overall market. The U.S supplies is far too high from being impacted by OPEC’s latest chess move.  By giving market share away to the U.S. they are losing their bastion over Asia.

Saudi Arabia’s state oil company considered to use their U.S. Unit to ship crude oil to the Asian market. After further analysis it wasn’t valuable to do so.

With the high demand of crude oil, the U.S immerses on becoming the first major player on the market. U.S. is now pumping more than 10 million barrels a day. That rise leads to a flow of overseas shipments. Helping channel the overstock at the nation’s largest storage hub.

In the last six months the U.S. have exported over 1.5 million barrels, it almost doubled from the previous six months. Asia is the primary buyer for crude oil.

The Chess game OPEC started few years ago, should be a cautionary tale to all the producers. By cutting supplies to undermine the market in the hope to destabilize the U.S. producers. They currently have a test of their own medicines. The U.S. producers have significantly increased international market shares. They are poised to continue to spend wisely as they are expanding production to meet the demand.