Quote:
|
Originally Posted by hi_im_god
oil is a global market. it doesn't matter who you sell it to. the chinese can buy all the russian oil and all that means is there is more saudi oil available. the global price is the same.
unless you think the russians have the last drop of oil, proximity is meaningless.
|
That is a simple view however the real world is more complex. Chinas demand for oil is through the roof and a direct pipeline to Daqing is already in the works. The Russians dont have much refining capability but the chinese have plenty of money to build refineries. That alone means the Chinese will be paying less. Since Russia isnt a member of Opec they can produce what they want and sell it at whatever price they deem fit. If Chinese demand continues to rise, in theory they can buy the same amount of Saudi oil they are now and get the rest from Russia. Obviously if they stopped buying OPEC oil it would have an effect but they will never totally depend on the Russians and I dont believe that the Russians can produce nearly enough. But I do know that if China is a big customer and Russia is providing a vast amount of oil that those two are more likely to join forces than with us.