[gleeaikin]

Russia’s war on Ukraine and Hamas’ war on Israel have potential to cause significant flux in the oil markets. Since many have only a limited understanding of these markets, I will lay out some of what I have learned in the past 13 years, which is well short of enough. My initial interest was sparked by the deadly BP oil rig disaster in 2010. [I own some BP stock.]

There are 2 main per barrel oil prices recognized in the Western World. WTI, or West Texas Intermediate, is a low sulphur, jight density, valuable crude. It is generally quoted a little below the price of Brent Crude from northern Europe. There is a wide range in per barrel prices, from cheap Saudi Arabia, and Russian crude, to high priced North Dakota crude. Keystone was an attempt to import dirty cheap tar sands oil using a pipeline. It ran into trouble both because of environmental factors in production, and because of the Kalamazoo river system oil spill also in 2010, caused when Enbridge’s pipeline burst and flowed for 24 hours. It cost over a Billion dollars to clean up this spill. States to be crossed by Keystone pipelines were not eager for a repeat of Kalamazoo with the dirty, toxic tar sands oil. The link below covers this disaster and following clean-up in some detail.

https://beltmag.com/kalamazoo-river-line-6b-oil-spill/

In 2016, tar sands continued to be in the bad news as a town of 80,000 people was evacuated due to wildfire which also burned much of the town.

https://earth.esa.int/web/earth-watching/environmental-hazards/content/-/article/fire-at-fort-mcmurray-canada/index.html

In 2023 many in the US were made aware of wildfires in Canada by orange skies and smoke in the air Again, the tar sands were threatened.
https://www.upstreamonline.com/safety/canadian-wildfires-threaten-oil-sands-production-rystad/2-1-1452915

When President Trump took office, oil supplies in storage were plentiful at the end of the Obama administration. The largest oil storage place in America and perhaps the world is in Cushing, Oklahoma. Below are figures for March 2015.

https://www.cnbc.com/2015/03/05/cushing-oklahoma-small-town-is-holding-illions-in-black-gold.html

Cushing continued to fill up even higher, and gasoline prices came down as companies were eager to unload their soon to be excess supplies. Trump benefited from the happiness of gas consumers in this oversupply situation. At one point the oversupply became so bad that people were being paid to take oil away—free oil, amazing. Oil producers in places like N. Dakota where you need around $80 a barrel to make a profit stopped pumping, and drilling. Oil prices have recently moved above $80 a barrel and with current events they way they are, are likely to stay up there. N. Dakota and other expensive area producers are no doubt opening up their wells again. No doubt others are drilling, although it takes while for new drilling to affect the current price.

This link has many details about effects of Covid on pricing. https://www.bls.gov/opub/mlr/2020/article/from-the-barrel-to-the-pump.htm

This link shows how the price of oil fell to minus $40 one day thanks to Covid. https://www.weforum.org/agenda/2020/04/oil-barrel-prices-economic-supply-demand-coronavirus-covid19-united-states/

This summer’s gas increases have several causes, high temperatures around refineries, and changes in production by Russia, Saudi Arabia, etc. are some.
https://www.usatoday.com/story/money/personalfinance/2023/07/28/gas-prices-up-heat-wave-oil/70486841007/

If you have read even half the links posted, it should be apparent presidents have a minimal effect on the price of gas, at least in the short term. I will not try to engage in the long term policy implications of the above information.

[Chgogal]

You forgot to mention the US’ oil refineries are old. The last large oil refinery that came online was in 1976. A small one came on line in 2020 in North Dakota.

https://www.instituteforenergyresearch.org/fossil-fuels/gas-and-oil/will-any-new-refineries-be-built-in-the-united-states/

[Chgogal]

“If you have read even half the links posted, it should be apparent presidents have a minimal effect on the price of gas, at least in the short term. I will not try to engage in the long term policy implications of the above information.”

If what you said above is correct, please explain the difference in total rig count between CYs 2011, 2016, 2017, 2018, 2019 and CY2023.

2011
https://www.aogr.com/web-exclusives/us-rig-count/2011
2016
https://www.aogr.com/web-exclusives/us-rig-count/2016
2017
https://www.aogr.com/web-exclusives/us-rig-count/2017
2018
https://www.aogr.com/web-exclusives/us-rig-count/2018
2019
https://www.aogr.com/web-exclusives/us-rig-count/2019
2023 thru (October)
https://www.aogr.com/web-exclusives/us-rig-count/2023

[Chgogal]

“When President Trump took office, oil supplies in storage were plentiful at the end of the Obama administration. The largest oil storage place in America and perhaps the world is in Cushing, Oklahoma. Below are figures for March 2015.”

The above statement implies that Obama purposefully increased oil reserves.
EIA SPR over the past 50+ years.
https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=pet&s=mcsstus1&f=m

During the Covid debacle and the decrease in oil prices due to the sudden and dramatic lack of demand gave the country an opportunity to top up the SPR. Trump intended to do just that but Congress in its great wisdom said no. Oil was less than dirt cheap due to world prices reacting to lower demand and over supply. It would have been a good deal. Now we only have 17 days left in the SPR and an impending Mid East war.

https://www.reuters.com/article/us-global-oil-usa-reserves-idUSKCN2251QU

https://www.breitbart.com/politics/2021/11/25/flashback-democrats-cut-trumps-replenishment-of-oil-reserve-when-prices-were-cheap-strike-a-blow-to-big-oil/

“ “We're going to fill it right up to the top — saving the American taxpayer billions and billions of dollars, helping our oil industry,” Trump said at the time.”