The rebound in oil, which has carried crude past $121 a barrel, can no longer be dismissed as a “blip” after crude fell within $110 last week. But that still does not mean oil has re-established the trend that saw it peak around $145 in mid-July.
The factors driving oil higher of late probably don’t mean much when viewed individually, so they add up to more than the sum of their parts. Worries about Russia’s response to a U.S.-Poland missile defense pact, news of the planned StatoilHydro ASA refinery shutdown in Mongstad, Norway, for two months, and an ongoing eye on Tropical Storm Fay have all contributed to the increased interest among buyers....MORE
Well that didn’t take long. Russia’s military incursion into Georgia, home to a key oil and gas pipeline, stoked fears that the West would have a harder time convincing Central Asian countries to defy Russia and take part in future pipeline projects that would reduce dependence on Russia. Now, some countries seem to be bailing out of the existing ones.
Kazakhstan is considering diverting its oil exports away from the BTC pipeline that runs through Georgia, and using Russia instead. The reason? “Security concerns,” brought about by Russian military intervention. From Turkey’s Hurriyet:Kazakhstan is considering pumping its oil through Russia as an alternative to the Baku-Tbilisi-Ceyhan (BTC) pipeline due to increased security concerns over the clashes in the Caucasus, a Turkish daily reported on Thursday....continued