Crude will rise next week on saber-rattling in Nigeria and the UN Security Council meeting.
The real fear is an extended outage. We have notable capacity reductions in the U.S. Gulf Coast production, refining and distribution system.
For Indonesia to continue to develop its oil and gas resources and to step back into the role of a true net exporting country and replace their position in OPEC this is a pretty important deal for them to close.
Oil markets have been a bit irrational in the past week or two with long-term supply concerns affecting short-term prices. Iranian oil exports are unlikely to ever be restricted and certainly not anytime soon.
I think OPEC realizes that China is an extremely important customer moving forward. This is about relationship building.
These people are receiving a return that is commensurate with the risks. What's going on is a concern for foreign investors and we're seeing maybe a bit of resurgence in unrest.
Our whole goal is to get 100 percent compliance from all counties.
At the end of the day, the Middle East is going to be China's premium source of supply for crude.
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