Saudi Arabia Dumping Cheap Oil To Crush American Energy Sector
Saudi Arabia is sending more than a dozen oil tankers to unload a massive supply of cheap oil into the American natural gas market, in what some are calling an attempt to seriously cripple the American energy industry.
Oil went ‘negative’ for the first time, meaning that traders were paying buyers to take the fuel supply off their hands. Demand for fuel has decreased significantly as a result of the coronavirus recession.
Saudi Arabia’s state-run oil company Aramco has sent a fleet of twenty oil tankers to the United States following a refusal by the Russian Federation to ramp down on oil production. This is around seven times the monthly standard export supply of oil from Saudi Arabia to the United States, and it’s peculiar that it’s arriving at a moment where the demand from fuel is lower from ever.
The 20 tankers hold a combined supply of 40 million oil barrels. They’re set to arrive at ports in Lousiana and Texas in late May.
North Dakota Senator Kevin Cramer has called upon President Trump to restrict the importation of Saudi oil as the American energy industry deals with the effects of the recession. An unlimited supply of cheap foreign oil could seriously hamper the recovery efforts of the American energy industry, leaving state-run enterprises in Russia and Saudi Arabia with an even greater share of the worldwide natural gas market than ever before.
A statement from Senator Cramer underscored the need to protect the viability of America’s natural gas industry.
“Today’s collapse poses a devastating threat to our oil and gas sector, with job losses in the thousands and national security being weakened if the industry cannot recover. The dramatic low underscores why we cannot allow Saudi Arabia to flood the market, especially given our storage capacity dwindling. Right now, the highest number of Saudi oil tankers in years is on its way to our shores. Given today’s news, I call on President Trump to prevent them from unloading in the United States.”
President Trump has suggested he’d be willing to temporarily block the importation of Saudi Arabia to avoid weighing down the struggling American energy industry, which is largely made up of private companies. Behemoth state-run enterprises of Saudi Arabia and Russia have shown an ability to engage in anti-competitive practices during times of global uncertainty.