By Micah Halpern
I've Been Thinking:
In an act of defiance, an independent Chinese oil refinery has suspended all US oil imports and replaced them with Iranian oil.
The company, Dongming Petro-Chemical Company, is just one company in what appears to be a pre-emptive Chinese strike against the United States.
The Chinese are also planning to charge a 25% tariff on US oil imports into China.
China currently imports 400,000 barrels of US crude oil per day. The additional tariff coupled with the suspension of importing US crude oil will have a huge impact on the price of US oil and gasoline.
Analysts speculate that China will drop almost all US oil supplies. China will make up the loss in their oil supply by importing from West Africa and the Middle East.
Never forget that China is the largest consumer of oil in the world. The Chinese are the most important oil market in the world. If the United States is frozen out of that market it will have a catastrophic impact on the oil market.
Micah@MicahHalpern.com
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