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the Petroleum under stress in recent weeks, dealing with uncertainties about the economic recovery, movements in the Libyan region, forecasts about the pandemic.
Crude oil fell below $ 40 a barrel after the surprise of Trump’s contagion, it could suffer further shocks with the American elections.
The November 3 presidential vote is looming. Amid the great uncertainty about events, the oil market risks forecasts. One of the most analyzed scenarios is that of Biden victory: what to expect at oil price in case of a democratic presidency?
The oil industry and the American elections
L ‘Oil industry looks at Joe Biden with suspicion and fear.
Following President Donald Trump’s positivity in the face of the coronavirus, the focus of attention has returned to the fate of the United States, with the black gold market in agitation. If the polls are correct, Biden will be the next US president, and this is not an encouraging sign for the industry.
After a supply war between Saudi Arabia and Russia, the virus-induced collapse in global demand for crude oil, falling prices, dozens of corporate failures and massive job losses, the oil industry fears the worst.
And the Biden energy policy it is considered hostile, or at least unclear. Certainly, according to experts and analysts, a democratic victory could have significant impacts on the oil industry, reversing Trump’s course and accelerating the energy transition.
Not only that, there is also the geopolitical agenda of the Democrat that must be kept under observation. A gentler strategy towardsIran it wouldn’t be of little importance to him oil exports. And it would unleash new mechanisms between the different producers.
Biden effect on oil with green policy?
The first element under consideration is Biden’s approach to energy transition, is not a priority issue for Trump at all.
The scenario posed by investors (with devastating effects on black gold) is as follows: Biden agrees to re-enter the Paris climate agreement, to spend 2 trillion dollars in clean energy, to decarbonize US electricity and electrify areas of the country’s transportation sector.
In short, a Democratic election could mark the time when the world’s largest oil and gas producer officially rejoins. global energy transition.
The Trump administration’s efforts to bolster fossil fuels, with the cancellation of pollution and emissions rules and the appointment of climate skeptics to positions of power, would be reversed. L ‘renewable energy it would find an acceleration.
With an agenda geared towards sustainability, even agreements reached at headquarters could disappear OPEC for the reduction of crude oil production. Trup has vowed to do so, threatening Saudi Arabia to withdraw US military support if it does not cut production.
Analysts wonder, however, what would become of this agreement with Biden, who is not very interested in the subject and focuses on green energy.
Biden, Iran and the oil glut
Biden could also have a negative impact on crude oil prices due to his choices in the Middle East. Specifically, intentions towardIran.
Trump’s uncompromising stance and stubborn defense of sanctions against Tehran crude oil exports they will not be supported by Biden.
Rather, the dem candidate would like to re-enter the international nuclear pact with Iran, provided the country abides by its terms again. In theory, it could end US measures on Iranian oil exports.
The consequences for oil markets would be far-reaching. Kevin Book of Clearview Energy Partners, a Washington-based consulting firm, told a Financial times that an agreement with Iran would result in the skyrocketing Persian oil production, flooding the market already in excess of supply.
Without pressure from the United States to maintain production cuts, it is hard to imagine theSaudi Arabia curb its crude while Iran, its geopolitical enemy, recovers a part of the oil market.
The Russia, the United Arab Emirates, Iraq and others hope to expand oil supplies again and they will. The excess oil would push prices further lower.
The little enthusiasm of the oil sector against Joe Biden.
