Was this moderation in oil volatility the result of adept diplomacy, or is it a more structural reduction in geopolitical risk? The U.S. consumes less oil from the Persian Gulf, while countries like China are becoming an increasingly important buyer to the region. U.S. Less Reliant On Oil ImportsThe U.S. is less vulnerable to Persian Gulf oil disruption than in any time in recent history, with only 12% of its crude oil supply coming from the region. The location is significant: over 20% of the world’s oil is shipped through this narrow strait, making it the one of the most vulnerable choke points in the global oil supply chain. All of that should remove some of the Middle East geopolitical risk that typically drives oil volatility.

Source: Forbes January 23, 2020 12:45 UTC