Crude is rallying on this final day of January, as hopes and projections of OPEC production cuts return to the fore once more. Before we charge into a new month tomorrow, amid weekly inventory data to boot, hark, here are five things to consider in oil markets today. 1) The implications of a Border Adjustment Tax (BAT) – aka an import tax – on U.S. crude would not only impact import flows, but exports and domestic production as well. If crude was homogenous, then there could be direct substitution: U.S. domestic production, suddenly at a 20 percent advantage given an import tax, could replace crude imports. But it is not quite that simple; crude comes in many different grades (we tracking nearly 400 of ’em). There are three main grades: light, medium and heavy. This is where the challenge arises. U.S. shale plays produce higher quality, light crude. This […]

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