Even though Syria is not a major oil producer, the recent threat of military escalation has created uncertainty and nervousness among crude oil markets around the world.
Syria produced about 370,000 barrels of oil equivalent per day in 2011, which is about one-third of the oil produced in Texas last year. The real threat, however, is if military action increases it could impact oil exports from the region, which is a major exporting area.
The volatility in the Middle East has created concern among oil traders about future deliveries possibly having an impact on worldwide supplies.
Crude oil prices rose after news broke of chemical attacks in Syria and the reaction of the Obama administration to possibly take military action against Syrian President Bashar Assad.
Analysts report that more than 1 million barrels of oil per day have been curtailed since the beginning of the tension in Syria.
Continued volatility in the region adds more uncertainty in worldwide oil trading as analysts attempt to predict the unpredictable.
Oil companies with operations in the region have difficulty in making month-to-month investment decisions much less year-to-year.
Within the last several years, unrest in Egypt and Libya have added to the discomfort level with fears that the changes could impact major oil producing countries such as Iraq, Iran and even Saudi Arabia.
Meanwhile, back in the U.S. the Department of Energy (DOE) last week approved another license to export natural gas from the U.S. DOE approved Dominion Resources’ application to export from Chesapeake Bay, Md to Japan.
DOE has given export licenses previously approved exports from Lake Charles, La., Freeport LNG project on Quintana Island, and Sabine Pass, La.
DOE has 20 other export proposals pending.