Why Europe Is Experiencing Higher Oil Prices Than The US

The world is presently sharing a limited supply of oil. When oil prices rise, oil production doesn’t rise very much, if at all. Figure 1. Brent oil spot price and world oil supply (broadly defined), based on EIA data. The issues then become: Which buyers get the oil? What uses get priced out of the market?  Which countries are disproportionately affected? It seems to me that this time around, Europe, and in particular the Eurozone, is the area of the world getting hit the hardest by high oil prices. Part of this has to do with the relative…

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