All the world a stage: Rising U.S. oil clout on show in Houston
HOUSTON (Reuters) - A glance at the attendee list at one of the world’s largest energy industry events in Houston this week left little question about the growing influence of the United States over global oil politics.
Present: top U.S. diplomat Mike Pompeo. Absent: leading Saudi and Russian officials, and most OPEC nations.
As the United States weans itself off foreign oil imports - thanks to booming domestic production - the complex web of politics and business interests that have shaped decades of Washington’s energy diplomacy in the Middle East and beyond is changing.
That shift was unmistakable in Houston this week.
In his keynote address, Pompeo spoke of exploiting the power the United States is accruing through rising energy supply in “punishing bad actors”; he laid out a vision of working with energy firms to isolate Iran and Venezuela; and he emphasized the need to protect oil supplies by countering China’s moves to control the South China Sea.
The Secretary of State delivered the half-hour speech to a packed room of energy executives, while dozens more watched via jumbo screens at the adjacent convention center.
It marked the type of reception usually reserved for the Saudis and other members of the Organization of the Petroleum Exporting Countries. When OPEC Secretary General Mohammed Barkindo addressed the conference a day earlier, the auditorium was half empty.
The speech itself was a far cry from past addresses by OPEC heavyweights: Barkindo called for cooperation with the shale industry, which has helped drive U.S. oil output to more than 12 million barrels per day (bpd), making the United States the world's largest producer. (Graphic: tmsnrt.rs/2VIJTbg)
Just two years ago, Saudi Oil Minister Khalid al-Falih delivered a combative keynote speech warning U.S. shale executives that OPEC would not carry “free riders” in its efforts to balance world oil supply and demand.
It turned out to be an empty threat, and a reflection of how OPEC had struggled to deal with the surge in U.S. energy production.
POMPEO MEETS BIG OIL
Beyond his keynote at the Houston conference - the first ever for a sitting Secretary of State at the gathering known as CERAWeek - Pompeo circulated among executives in closed-door meetings, even, according to a source, hosting a group informally at Pappasito’s Cantina, a Mexican restaurant in the Hilton Americas Hotel where the conference took place.
“I’m not used to it, but I think it’s great,” said Vicki Hollub, chief executive of Occidental Petroleum, saying she was impressed by Pompeo and his team’s outreach. Occidental has been one of the biggest winners from the surge of U.S. shale exports.
In one private meeting on Tuesday, Pompeo and his State Department energy adviser Frank Fannon sat down with big oil companies including Royal Dutch Shell, BP plc, Occidental and Chevron Corp.
At that meeting, first reported by Reuters, Pompeo talked about how the government and the world’s top energy companies could work together to encourage U.S. allies to buy more of its oil, according to two sources familiar with the discussion. He also asked for their cooperation on Iran.
The Trump administration has imposed hefty sanctions on Iran and Venezuela, both OPEC members, with growing confidence that there is enough oil from the U.S. and elsewhere to deal with any supply disruptions.
So far, that bet has panned out - global oil prices are currently less than $70 a barrel.
Coming into office, President Donald Trump promised to deregulate the energy industry and assert U.S. oil independence - a sharp turn from an Obama administration that, while placing sanctions on Iran’s oil exports, largely built its energy policy around renewables and reducing emissions.
Aided by rising shale production and new technology that has made pumping U.S. crude less costly, Trump has also been able to publicly lean on OPEC, frequently taking to Twitter to urge members to increase output to keep prices low.
Rest at sauce.
>https://www.reuters.com/article/us-ceraweek-energy-opec-insight/all-the-world-a-stage-rising-u-s-oil-clout-on-show-in-houston-idUSKCN1QW28X?il=0