By coinnews 
00:00 Speaker A
They had a conversation with the source earlier this week who said that there could be guarantees of direct purchases of LNG put into tariff negotiations between the US and China. How are you thinking about that as a tool within the trade war?
00:20 Catherine
Yes, so that would be quite interesting. The whole trade war with China is going to have quite a significant impact on the energy spectrum for the US more broadly. It obviously doesn’t just affect oil and gas producers and clearly with oil prices where they are now, that’s putting the profitability of the shale plays into question and certainly making big questions around the prospects of new drilling, which is clearly a priority for the administration. Um but this also has a wider impact on renewable energy, and that’s obviously not such a priority for the Trump administration, but nevertheless it makes all of the supply chains more expensive. Uh so I think the energy sector more broadly would be pleased to see anything that looks as if it’s going to be a softening of uh the somewhat hostile rhetoric that’s been going on between US and China.
02:12 Speaker A
And Catherine, Steve Stassnick here in studio with me as my guest host today. He’s got a question for you.
02:19 Steve Stassnick
Hi Catherine. Um, you know, you mentioned a bunch of factors, none of them bullish for oil prices. And and literally as we’re I’m sitting here, I see that that inventories rose 515,000 barrels to to the highest level since I guess July. Um, is there any is there a bullish sign on the horizon or or you know, are we just sort of looking at lower oil prices which benefits consumers in the long run, but definitely does not tell a great picture for the economy potentially.
03:15 Catherine
Yeah, I mean, I I don’t know whether in the long run it will be so great for consumers because eventually you will get a correction as, you know, the length in the market will be taken away by producers who can’t operate economically at these levels. I think really the answer to that question lies probably outside the energy markets um and more into the wider scope of what’s going to happen with this effective trade war between the US and China um and how the US manages these relationships um obviously not just with China, but also with Europe. Uh there’s huge pressure for Europe to take more more US gas in particular. Uh and so it really depends on what Trump’s strategy here is going to be. Uh whether this is a long-term play for him to maintain tariffs and and have this sort of very strong arm tactic around his economic policy or whether this is more of a short-term play to try and get people to move more in line with his wider policy objectives. Um and that’s really a very difficult one to call. If we continue on the current track, uh then yes, it’s not really good news uh for oil prices in the near future and that’s going to be particularly bad news actually for the US shale market.