capSpire Blog

A little over a week ago, Argus hosted its 9th Annual Americas Crude Summit in Houston, Texas. Although each year is different, there was a certain amount of optimism radiating the halls that I found encouraging. After a bit of reflection, I have identified five highlights that I took from the conference.

1)     Don’t expect sweeping changes in U.S. energy regulations.

Several thought leaders, including Sutherland law attorney Jacob Dweck, presented key themes. One of these themes is that although state and local governments will play a bigger role in energy regulation, current legislation will limit sweeping changes to U.S. environmental policy. In reference to President Trump, Dweck said, “Clearly, some of Trump’s actions are going to be helpful to various sectors of the fossil fuel industry, but I don’t believe they represent a fundamental redirection.” You can read more here: Crude Summit: No sweeping change in US energy regs

2)     There is reason for optimism with the new presidential administration.

A host of speakers, ranging from former U.S. Ambassador to Russia Michael McFaul to former Secretary of Defense Leon Panetta, heaped praise on some of President Trump’s cabinet picks. The nominee for Secretary of State, Rex Tillerson, and the new Secretary of Defense James Mattis received the most notable praise. The overriding consensus is that both men possess the experience and intellect to be effective complements to the president. That will bode well for the U.S.

3)     Long-term relations with Russia are still unclear.

As mentioned above, one of the keynote speakers was former U.S. Ambassador to Russia Michael McFaul. Ambassador McFaul was particularly effusive in his praise of Rex Tillerson, calling out his understanding of how the Russian system works. His making a $500 million deal in Russia is certainly sufficient proof. (Crude Summit: Tillerson may be tough on Russia) Conversely, there is still a lot of cynicism that sustained positive relations with Russia are possible.

4)     Global demand could increase U.S. exports to more than 1 million barrels per day.

Demand around the world, ranging from Europe and Latin America to Asia, could continue to increase U.S. exports. Here is the link to the Argus news story: U.S. oil imports could reach 1 million barrels per day

5) Crude prices will, you guessed it, remain volatile.

No conference in this industry is ever complete without the myriad of slides with historical data points on the volatile nature of crude. Margins will remain tight, but sound strategy and quick reaction will continue to define the winners. So, in a nutshell, expect more of the same.

As we gear up for another fast and bumpy ride that will surely be 2017, there is cause for hope, optimism, and caution for crude marketers. There will no doubt be challenges along with way, but for those who have been around awhile, understand that if there is one thing this industry possesses it is resiliency. capSpire will continue to share news, ideas, and best practices around the fossil fuel industry, so stay tuned.