Yeah. I don't know what would be the "non Russia invasion" price because demand was increasing even while Trump's term was ending, but it does "seem" prices were between 80-90/bar from fall of 21 to Putin's invasion. That was NOT historically high.
But, if producers think 80-90 is a base floor that can be sustained even if there's continued increases in global demand. And with nuclear and coal declining in the US, and the EU cutting nuke, I'm all for LNG for Europe. As for the US, as the cost of storage of solar and wind continues to decline, it's more politically palatable to mandate mixed use, and frankly utilities don't really care.
Wait. I saw this on the way out, and thought it might be of interest to ... those who think
Behind the dramatic fall in prices on Wednesday was optimism about a diplomatic solution to the Ukraine war. An apparent plea from the United Arab Emirates had called on the Organization of the Petroleum Exporting Countries and its allies (OPEC+) to increase production, accelerating declines.
Both of those factors were fading on Thursday. Peace in Eastern Europe remained just a hope after top diplomats from Russia and Ukraine failed to reach a cease-fire at talks in Turkey,
The Wall Street Journal reported.
“The U.A.E. has since reeled back on its initial OPEC+ comments, the Iran nuclear deal is stalled, and Reuters is reporting that China’s state refiners are being urged to halt April fuel exports,” added Jeffrey Halley, an analyst at broker Oanda. “I can only imagine that liquidity is shot to bits in the oil futures markets now, and picking technical levels is a bit meaningless.”
The invasion of Ukraine by Russia two weeks ago has intensively disrupted commodity markets, sending oil prices skyward amid tough sanctions on Russia, which is one of the world’s most significant producers of crude. Crude prices remain at their highest levels since 2008, with WTI spiking as much as 30% since the Russian invasion.
So far, tough financial sanctions on Moscow have complicated supply chains and led to traders “self-sanctioning,” limiting supply and pushing up prices. A widespread embargo from the U.S. and U.K. on Russian crude could exacerbate the situation in the long run.
But prices were rising long before conflict erupted in Eastern Europe. A year ago a barrel of crude was $65, which rose to $75 by the time 2021 was done. Demand for oil has come roaring back from the depths of the pandemic amid a backdrop of tight supply, with producers like the OPEC+ group facing barriers to increasing their output.
The situation shows little sign of improving, short of a complete end to hostilities and the ending of sanctions.
Oil prices popped higher on Thursday after one crude benchmark fell by the most in two years in Wednesday trading. Volatility is expected to remain as the Russian invasion of Ukraine continues to roil commodity markets.
www.barrons.com
I don't think that should mean an investor should expect to see prices under 70/bar. And that's probably good for Texas drillers and guys in the Bakken and the Western Canadian field
