Shale Oil & Gas Revolution

Controversial theory could explain the unusual behavior of oil prices

shale-oil-and-gas-revolution
From Azizonomics:
 
Something totally bizarre has happened in the last three years. Oil in America has become much, much cheaper than oil in Europe. Oil in America is now almost $30 cheaper than oil in Europe.
 
This graph is the elephant in the room:
 
 
Why?
 
The ostensible reason for this is oversupply in America.
 
That’s right – American oil companies have supposedly been producing much, much more than they can sell:
 
This would be hilarious if prices weren't so damn high, but despite a robust export market for finished products, crude oil is backing up all the way to Cushing, Oklahoma, and is only going to get worse in 2013.
 
Enterprise Products Partners LLP has let the cat out of the bag that less than a month after expanding the Seaway pipeline capacity to 400,000 barrels per day, the Jones Creek terminal has storage capacity of 2.6 million barrels, and it is basically maxed out in available storage.
 
But there's something fishy about this explanation...
 
 
More on oil:
 
 
 
Post your comment...