An astute analysis from Marc Flaster about the future of Oil, OPEC and the Globe

by Laura Ehrenberg-Chesler on March 7, 2016

in Energy,Foreign Markets,Geopolitical

Our good friend Marc Flaster recently offered some astute insights into the changes that are about to take place for the price and availability of oil and natural gas, as well as how those changes will effect relationships around the globe. It is brilliant!!

“We have heard a lot about oil supplies, storage running out of capacity and shipping taking slower routes in the hopes that the time of delivery will coincide with a better price. Production both here , Russian and OPEC and, while we are at it, include Venezuela, Brazil, Argentina and others, continues at the maximum rate and is not about to change. All the talk about declining rig count relates to the higher lifting cost production while the emphasis shifts to the more efficient well heads. But the big news is natural gas, specifically LNG. The US is embarking on a major conversion of NG to LNG to be shipped to Northern Europe, and Japan, for starters. For Europe it will allow those countries to sever their dependence on Russia for winter fuel, and for Japan it will allow for conversion to a resource that requires replacement after the meltdown of their nuclear commitment . Right now they are dependent on coal, an environmentally unfriendly alternative.

Between oil, and now LNG, the US is on the road to silence the Middle East bravado. In a very short period of time OPEC will no longer be able to hold the developed world hostage for energy. The ramifications are wide spread. With less revenue, forget about the route in price, the Arab support for ISIS, ISIL, Jihadist, and any other splintered combatant will wither. With the additional loss of markets, the budgets of the countries mentioned will be under pressure to continue to provide a largess to their people. This suggest reform, less aggression, and peace (at some cost). This is no longer wishful thinking. I ask you to put this is the back of whatever book you are reading for future reference.

Remember, there is no such thing as the Status Quo. Change is the only constant.”

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