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We got a drop in demand for oil, and yet we’ve got supply shocks going on as well. Who wins that microeconomic battle?
So far, I think it’s the Fed winning. The Fed is trying to create inflation, and I think they will continue to do so. So from my perspective, it is very hard to see a sustained decrease in prices unless we have a recession.
What is the exploration appetite right now globally?
In the U.S. there is a lot of interest in exploration, and in Australia, Brazil, Colombia, even in Russia. Where you have a proper rule of law and the resources and the capital and technology, there is strong appetite for exploration. The problem is that 80 percent of the world doesn’t fall into that category.
Is China still insatiable?
If China continues to stimulate the economy domestically, they could go into a current account deficit. And if that is the case, they are going to have to open up their sector to foreign assessments and really show everyone what is on their bank books, and they are going to really have to open their financial system. And I don’t think they are ready for that.
Is gasoline supposed to go down just because it is September?
Gasoline should come down somewhat. But as I warned before, you will have the Fed possibly moving into another round of quantitative easing. So a bit of a mixed bag, I would say.