Oil supplies from the Middle East have been savaged by violence, sanctions and instability. Libya, home to Africa’s largest oil reserves, has cut exports by 80% since its ports fell into the control of militias last year. Sanctions have cut 1.5m barrels of oil a day from Iranian exports while strife in Iraq, Venezuela and Nigeria has cost hundreds of thousands of barrels a day in production. All up, about 3.5m barrels of oil from these regions has been stricken from global supply.
Yet oil prices have fallen. In fact, the past four years have seen the most stable prices in recent history. How is that possible with so much conflict and strife? There is a new force in global oil: North America.