Vicki Goodwin on Oil Markets – including Yemen, the Suez Canal, the Houthis and Iran

Vicki Goodwin on Oil Markets – including Yemen, the Suez Canal, the Houthis and Iran

hi folks so it’s guy here I’ve gotten a visit from Vicky Godwin who’s a member of the value X community and she is our Guru on everything oil and energy and been extraordinarily helpful in explaining to me all sorts of developments in the energy market so I’m going to ask you a few questions and have fun with it thanks so Vicki what’s going on in the oil markets um I think we’ve gone through period post the OPEC decision um at the end of May where the market was extremely oversold um and it’s begun to bounce off those lows and is now turning to what should be the peak of the summer crude refining run season um and I’m looking for things to go a little bit higher um in the weeks ahead can you Vicki um uh you know I don’t know much about oil as you know but I see Yemen doing all sorts of stupid things can you just explain what’s going on in in Yemen and how that affects the oil Market certainly I think what we’ve seen um since the back end of last year is that the houthi attacks on shipping has effectively closed the Suez Canal to a lot of traffic um predominantly crude coming into Europe um through the SE canal and also Diesel and jet fuel what that’s meant is is that all of these caros have had to take the long way around the Cape of um South Africa in order to avoid transiting through the canal further um certain aligned political um countries such as Russian crude that was transiting the canal had been uh given effectively a safe passage but we’ve seen aack Step Up in recent weeks um and vessels have been hit but seem to have no apparent connection to Israel or to the UK or us um and maybe we’re transporting crude oil to India or we’ve seen now an escalation and attacks where the houthis are actually um using submarine drones and sinking boats so the risk is absolutely not diminished there briefly does that reduce I mean I presume that Egypt makes money out of ships going through the canal so does that reduce Egypt’s foreign exchange income it certainly reduce revenues the transit fees that they would receive for the use of the canal and there doesn’t appear to be an immediate end inight to that so last question um uh so we’re supposed to have an embargo on Iranian oil but effectively the way I understand it is Iranian oil just gets sold to other countries who’s buying Iranian oil and at what price um price is not particularly transparent it’s below typical Market values um but it is all moving to smaller Chinese independent refiners uh crude oil itself has very little value outside of a Refinery it needs to be processed to make it into anything useful um and at the moment the Iranian oil is being disguised um and sold into transiting via um typically ship-to ship transfers rebranded insalled into China wow fascinating anyway so that’s Vicki thank you Vicki uh another installment perhaps at some point enjoy