A little note from JPM worth remembering:
US Senate Energy Sub-Committee meets during the week to consider lifting crude oil export ban. The tone of the senate hearing was generally positive towards an eventual lifting of the ban with panel members citing “security dividends” that could accrue to the US regarding free trade initiatives and policies on Iran /Russia, US refinery mix issues (underweight light oil processing capacity) and the Brent-WTI spread deterring US upstream investment and jobs. The primary reason for continuing to support a ban on crude exports appears to be the fear of rising domestic gasoline prices and the potential impact on US economic growth. Our base case assumption is that the ban on crude exports is retained through 2015 and 2016. Any move to accelerate the potential export of US crude oil could be negative for Brent and positive for WTI.
