Mr. Putin is whistling past the graveyard. Oil prices are now disconnected from physical supply and demand and are entirely a function of bloated futures trading on the NYMEX. Indeed, world crude stocks and supply are more than adequate for needs and the world is effectively awash in oil. A simple signal from Washington to the hedge funds and other unknown buyers who have propped up the NYMEX contract could tank oil quickly to $50 or less, as happened when the Russians invaded Georgia in 2008. Yes, US upstream companies would suffer. But the US would get a cold and Russia would get pneumonia. Oil-importing China would breathe desire — for a while.
Make that “breathe easier.” Darn spellcheck.