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Jim Reynolds's avatar

From AI:

China built a strategy around buying discounted oil from sanctioned states (Iran, Venezuela, and Russia) to keep refinery costs low. 

If Iranian and Venezuelan flows are disrupted simultaneously:

• roughly 1/5 of China’s crude supply chain becomes vulnerable

• the loss mainly hits independent Chinese refineries (“teapots”) that rely on cheap sanctioned crude

• China would likely replace barrels from Russia, Saudi Arabia, Brazil, or West Africa, but at higher prices.

Jim Reynolds's avatar

Bob told me he wanted to make this crystal clear: we have been here before and the path is not easy. And as always, we are confronted with “the big gray area” in terms of decision-making. At least we have a leader who is willing to make the hard decisions — a rarity.

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