Breitling Oil and Gas Morning Podcast #166 10-9-12

Government regulatory actions, a weakening dollar, and an ailing economy, are providing bargain asset shopping opportunities for Chinese investors. While such investments may sometimes offer companies life-saving bail-outs and can afford means to expand international business markets, these benefits often come with costly consequences.

One pending Chinese investment presents enormous opportunity costs and economic penalties for America, with virtually no benefit whatsoever.

Sinopec, another Chinese state-controlled company, has a $5.5 billion stake in a plan to build a Canadian Northern Gateway oil sands pipeline from Alberta to the Pacific coast province of British Columbia. The big question is whether this crude will flow south to U.S. refineries, or west for export to China.  This is really a direct result of the administration’s resistance to Keystone XL, the pipeline that would bring 700,000 barrels of crude daily to the U.S. rather to an eager China.

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