President Trump is shaking up the old guard dominating the global oil market.
After a painful, Obama-induced decline, worsened by a sustained slump in oil prices, the U.S. oil and gas industry is finally staging a comeback. While the liberal elite wastes no opportunity to decry Trump’s “America First” energy plan, a more sober look will actually show that not only is the policy a godsend for the industry, but it will actually help Washington build stronger bridges with other countries........More
My Take - The worldwide energy situation - fracking - is changing the world, and the U.S. - abandoning the Bretton Woods concept where we defend everyone, patrol the oceans trade routes, and open our markets and finance everything - will not only have less responsibility, the U.S. may be the only nation on Earth to go through the coming disruption with only minor negative impact. The rest of the world is going to have to fend for itself.....and they will come to the U.S. begging for support - militarily, financially, technically and politically.
We're on the verge of momentous times, and as long as the leadership understands their job is to uphold, defend and take care to Americans first and foremost - then this nation will not face the economic disaster awaiting Europe, China, Russia, and much of South America. Africa may actually benefit as their old European colonizers may have to come begging to them for trade agreements. It will be interesting to watch.....and it all starts with energy independence in the US.
Oil and gas industry activity is mostly driven by price forecasts, which are partially driven by the future markets as well as other indicators such as competitor activity. A possible income tax reduction influences long term outlook, but it doesn't impact much the short term. The approval of the Dakota Access pipeline is a positive signal, because it is evident Obama was playing to an irrational constituency.
ReplyDeleteLonger term, I wouldn't put so much hope into light tight oil production (what they call "fracking"). It needs higher prices, which should come about by 2019-20. Until then I suspect most oil development activity will focus on the Permian Basin. Trump is somewhat positive for the domestic oil and gas industry. But I'm not sure he's got his act together in the foreign policy area. For example, the baloney about forcing Mexico to pay for us border control costs comes across as arrogant and somewhat stupid.