college years. >> for past winners of c-span student cam video documentary competition the experience spark their interest in documentary production. >> i currently attend drake university and that's in des moines iowa and the fun part about that is i get to be in the middle of caucus season and i got to meet somebody different candidates and because of c-span i had the experience and equipment and knowledge to be able to actually sell some of them. >> this year we are asking middle school and high school students to create a short video documentary asking the question what issue do you most want presidential candidates to address during the campaign? include c-span video and reflect differing points of view. we are awarding $100,000 in total cash prizes. including a $5000 grand prize. >> be passionate about what you are discussing to express your views no matter how large or small you think the audience will receive it to be. and know that in the greatest

country in the history of the earth you are deemed as matter. >> for more information go to our website www.studentcam.org. >> here to talk about security of the global oil market is brian scheid, the oil news a senior editor for smp global plats, thank you for being here. >> things or have any. >> tell our viewers what exactly was struck in saudi arabia and how it impacted supply. >> about a week ago the oil market was in almost a general malaise over and over supply situation, there wasn't a lot happening with the crisis was very volatile market. then saturday morning happened and there was an attack on the ad quick processing facility the largest in the world in saudi arabia and the crew raise field which is the second

largest oil field in saudi arabia there is still a lot of debate about what actually occurred during this attack and who's to blame, the u.s. is already can blame on iran and we will see a lot more as that goes forward but what happened with prices was this knocked out 5.7 million barrels per day of production that's roughly nearly 6 percent of global supply. that is the biggest supply disruption in the history of the worland it happened in an instant. this happened when global oil markets were closed. we had to wait until sunday afternoon for the asian markets to open and smp global plats analytics forecasted there would be about an increase may be to 70 to 75 dollars a barrel. there is a new risk premium obviously, maybe it could go eventually to 80, we saw a massive increase. 19 percent increase by the end of monday prices settled and went down, he went up to about

$69 and increase about $8.80, a massive increase for the market. yesterday the new saudi energy minister comes out and says we can have reduction back, this is a massive loss significant loss of production but we can have everything pretty much back to normal in two weeks. we are still about four dollars above where we were last week but of the same time a lot of the analysts i talked to are not out of the words. there's a new 5 to 10 dollar per viral risk premium. geopolitical risk premium based on something else that could happen like this, the middle east going forward. that's what analysts believe. we don't know what's going to happen next.

>> the risk premium, does that stay then on the price? >> yes. >> and when if ever does he get removed? >> that's the expectation and you saw president trump talking hinting at will there be military response? that will obviously increase prices. you have an ongoing situation in the straight of hormuz with iran taking vessels. then this i think just the size of this event is what has the oil market so weary at the moment. 5.7 million barrels per taken off without warning. it's not like something we could see we could see coming down the road. this was always sort of a wildcard to analysts. something that might happen or something that was modeled at a maybe.now that it's happened, there is all sorts of new wildcards we can do with that. it's no longer an attack on single pipeline and a confiscating a single vessel. now we are talking about six percent of global supply can be effective. we are talking about a tax on full oil field that's on the

table. there's a lot of unknown going forward. against this backdrop is u.s. oil production. we have gone from increased about 3.5 million barrels per day over the past three years at a record $12.2 barrels per day. ãbsees this going above 13 million barrels per day. dmthat is very surprising a decade ago from what you would expect. the increase we've seen in the past few years, 3.5 million, put that in the context that's more than the country of kuwait reduces. you look at individually go down to the states north dakota is now producing more than libya, you have new mexico now producing more than venezuela. then you have texas texas which is completing with the entire country of iraq. u.s. will supply is really balancing out a lot of what could be seen as this major

risk. plats analytics sees it as a five to $10 geopolitical risk but that's being counterbalanced now by supply. >> what do you think the price would be or the geopolitical risk would be if the united states was not producing at the level we are producing? >> think a lot of analysts will tell you you see another run up beyond $100 per barrel. we could be looking at more. the big take away i think from this event was that it could have been a lot worse in terms of price and i say worse, there are winners and losers depending on the track of the market. we could've been looking at five dollar gasoline or $150 barrel oil, there were some analysts that said this is such a major event we could be looking at $100 over $100 a barrel. but at the same time, there was

this glut of supply. this is been a market that's been oversupplied for months. that definitely did balance out the severity of the incident wax how did the president react to the attack to adjust and did he have to tap into our reserves? >> on sunday night may be three or four minutes before the asian market opened president trump tweeted out, i have authorized the release from the strategic petroleum reserve. the u.s. since about 1975 had stored a lot of crude oil in four separate sites along the gulf coast. two sites in texas two sites in louisiana currently they have about 645 million barrels between the four sites. right after 9/11 there was

discussion maybe we could she could go to a billion barrels. that narrative has really flipped with the shale revolution. they are instead selling off a lot of that crude. now we are at 644. president trump announced, and ready to sell off some crude from the spr and he said it's going to be coordinated with the rest of the world. that i think you could argue did dampen the impact of this incident on prices a bit. even though there is a glut of us supply a release from the strategic petroleum reserve still does bear some weight. he ended up not releasing anything, i think saying aboard air force one must make the impact wasn't so bad. you saw as well the saudi's announcing we are going to be back to normal in about two weeks. what i'm hearing from sources is that it's no longer being considered. but it does stress the idea of what purpose do strategic

petroleum reserves served in the u.s. when we have this record-breaking production going on. do we still need to store millions of barrels, hundreds of millions of barrels of crude oil when we are producing at this rate? >> we want to get viewers involved in the conversation as well. your questions or comments about the global oil supply in the market 202-748-8000 for those who live in the eastern country.the 202-748-8000 one for on pacific. let me tell viewers remind viewers you can also text us at 202 ã748 b8003. ãb who benefited from the attack when it comes to the oil?

which actor is trying to pull the u.s. into a conflict with iran.perhaps you can answer the geopolitical foreign policy questions there but who does this or who could this benefit. >> and daca speculate at all behind who's behind the attack. secretary pompeo is pending the blame on iran. it's one of the things i'm sure will hearing a lot more going forward. i would say that the main and tfishing areas of this attack are u.s. producers. they are now producing at this record-breaking level and there is a lot of questions, the duke decline in capital spending, is there too much? are we over supplying the united states? these are a lot of questions they had before the attack. now they can continue to produce and record-breaking levels with an increase in prices. at the same time all this is going on this sort of happened this confluence of events there is a new saudi oil ministries started about two weeks ago.

opec and allies had just reaffirmed their commitment to this massive production this 1.2 million barrel production that happened about a week before in abu dhabi. he had all these different things happening. there was a lot of analysts that view u.s. production as slowing down now. in the attack on adequate happens and i think it's really shifted everything. i've heard the term game changer more times than i can count this week. >> review with our viewers what is opec. also, what you said about this deal to cut production and why were they talking about that in the first place and what is thea impact?>> the organization of petroleum exporting countries that essentially led by saudi arabia unofficially. mostly middle east producers for venezuela in there as well.

they get together a couple times a year and decide where should our production be? it has a lot of criticism on capitol hill that they are manipulating the price. there is no opec bill making the rounds in congress for several years it has really gained much traction but we will see if it might with oil prices continuing to go up. they announced a cut in es production basically because they were getting hurt by u.s. production. it was becoming tough to compete and prices kept slumping. they were not continuing to rise.we are not seeing 100 all barrel oil anymore so the attempt was made by russia and opec and a few like nine other producing countries. to cut about 1.2 billion per day of their collective supply. that would give a little boost. which i think it had and you

see you could see this $55-$65 brand oil price range in the future contract that lasted several weeks. this is a very volatile market and i think you are seeing this period of very steady prices where they could have well above breakeven prices for opec countries. that cut continues it's going to continue, it is continue to schedule to march 2020. we will see how this will impact that. opec has not declared emergency meeting. which is something maybe you would have seen a few years ago. they have not deemed that to be necessary at the moment. >> brian is here to take your questions about the global oil market. if you live in the eastern central part of the country

202-748-8000, mountain pacific 202-748-8001 can also text us at 202-748-8003. let's go to bill in pennsylvania. >> good morning. my question is, basically, i understand the impact shouldn't have been so great but yet gas prices in western pennsylvania shot up over $0.20 per gallon overnight. nobody addresses what i see to be gouging if the supply is still not relatively level why is gas prices shot up so much? >> will work on your audio, what bill is asking is and where he/she lives it shot up 20%. >> $0.20. sorry. can you hear him now? >> can you repeat what you you're saying about the gouging part of it?

>> asked the question. if the oil supply is relatively stable, why has gas shot up $0.20 overnight? >> got it x gasoline prices can be complicated and can be regional. mason hamilton, an excellent petroleum analyst with the u.s. ng administration had a couple tweets yesterday niexplaining what the impact will gasoline prices would be and it typically follows brent oil prices and it's usually 80% of the impact. let's say brent oil prices go up $10 and 80% of that increase is going to be baked into the change in gasoline prices. the other thing is, it takes about two weeks for that impact in the oil market to have impact on the gasoline retail gasoline prices. >> analytics sees gasoline prices going from about 262 280

so at the moment i can't really speak to what the increases is, there can be a variety of factors will most likely something that happened about two weeks ago. this incident hasn't so far yet had much of an impact on gasoline prices.>> let's listen to what president trump had to say monday when he was in new mexico about the u.s. energy position. >> the united states is now the number one producer of oil and ucnatural gas anywhere in the world. this means more jobs. higher wages and american energy independence, which is what we have. a few years ago we had a problem like you saw it two days ago in the middle east we would have been in a panic, although not if i were your present we don't want to panic we never panic. but a few years ago there would

have been in the panic, today, we've got a lot of oil, we've got a lot of gas. >> we are not in a panic, what does that say about saudi arabia opec'inuee? >> i think the relationship between u.s. and saudi arabia has changed significantly and i think the ad quick attack very clearly shows that. we've seen declines in overall endpoints of crude oil still not the net exporter at all. we still do import a significant portion of our crude oil. we actually point out $12.1 billion per day the u.s. produces 12.1, 12.2, we still consume about 20.5, is still a significant difference between those two between supply and demand. what we are seeing from the saudi's last week the eia put up their weekly numbers and

showed that weekly imports of saudi arabian oil to the u.s. fell to the lowest point in record on record. our imports of saudi crude are falling to levels we haven't seen since the mid 80s. that reliance on saudi oil isn't as high as it was. it still there refiners are still importing a lot from the west coast and a lot medium ted cruz. there is still reliant there but not totally reliant. >> to the u.s. produce more credit meet its own demand? >> this gets into the thorny o topic of what type of oil the u.s. produces. the statement produces a very light oil. and a lot of it is in demand and typically in asian refineries. at the same time, a refinery

are geared toward processing more medium and heavy oil. we still need to import those bills. that's sort of the imbalance that's why the u.s. as part of a global market you could say there is this idea of previously we had this idea u.s. oil pretty much everyone dismisses that as not even a remote possibility, now it's this idea of the u.s. energy dominance we can become the new saudi arabia, that's the thinking alleys. but i think more of what you are seeing is an integration into the global market. we are seeing the u.s. refineries continue to import these heavy crudes, u.s. producers continue to produce light crudes. you could have still a need out there there could be a shortfall of supply but the u.s. producers may not reduce as much just because that demand for light crude may be

doesn't match up with the demand for heavy or medium crude. >> let's go to keith in fargo north dakota. keith, go ahead. >> 29 years o eny uncle was up in colorado they were drilling for oil and they were getting gushes of oil and just tapping it and looking for a rhenium our government is screwing us over. i want our government to quit whipping us off.

the thinking was we are eventually going to run out of oil. pretty much i don't think there's anyone that discusses the idea of peak oil anymore. now with the idea of peak demand. tracking technology, all the idifferent changes you have in drilling, they basically are producing more than they ever thought was possible and we even have ideas like stranded assets now. countries are abandoning ãb companies are abandoning exploration in countries simply because they don't have the money or time to do it. they can do so elsewhere much more cheaply. the u.s. oil supply has really changed the game in terms of supply and demand. no longer talking about peak supply talking about when

demand will run. >> good morning, can you hear me? >> yes we can. i had two questions, my first question is, who are the top consumers of oil at this time. you mentioned about the strategic petroleum reserve, is there just oil sitting there and how is oil able to sit there without was a long shelf life, i don't know very much about oil. >> u.s. remains the top consumer of crude oil. ãbthe ad quick we saw a lot

of what was impacting prices was the u.s. china trade talks. because that could have impacted demand for oil from china. your second question on the spr, the there is four different sites along the gulf coast two in louisiana, two in texas. these are salt caverns where crude oil is stored. oil that was bought i've actually asked this question myself when i was at a tour at one at texas. oil that was bought in the 1970s is still there. it's the same oil. for 40+ years it still being stored there. there is some degradation of the cavern wall from time to time they do maintenance it's a tremendous cost involved in keeping the oil, which is one of there's been sort of a push to sell off a lot of the oil and that was one of the arguments against it. the shelf life is there, it still is the same oil that was brought originally.

>> u.s. is the largest consumer of crude oil, break down how it's used in the united states. >> the exact percentage i'm not sure. but as significant portion of it goes into motor gasoline. there is also a nebig petrochemical component as well. that i think that's an important point we should talk about is you think about oil is made you think about we are talking about are driving less. cars are more efficient we are switching to tesla's. but the biggest increase in demand is coming from plastics. those oil being the feedstock they are you are seeing this massive growth of petrochemical myths facilities particularly in asia which is where a lot of the growing demand is. that's one of the ways crude oil demand is accounted for. >> ajay and hawaii, good morning.aw >> good morning. thank you c-span for your wonderful programming. thank you greta for the work

you do. i wake up at 1:00 a.m. here in honolulu because i'm a big fan of c-span. thank you for your guest. >> that's dedication. thank you. [laughter] >> i think i'm your number one fan. my question is, if it turns out that iran is responsible for this attack, and i'm not sure that i trust the trump administration, they lie to us so much i don't know that i trust what they have to say about it but if it turns out that iran was responsible for this attack, how would iran benefit from the shift in the world oil markets? >> thank you. >> amazingly we been talking about oil prices for this long we have not mentioned sanctions on iran or venezuela. the u.s. does have a very punitive sanctions currently on

iran oil exports. their exports have fallen dramatically over the years there still the militia trading going on but the united states will sanction anyone currently that is trading oil with iran. how they benefit from this specific attack? i don't know. i think depending on how the u.s. makes the case, hypothetically you could say that could be a coalition built to further those sanctions for the european countries still in the jc poa the nuclear agreement agreed to during the obama administration and the trump administration departed from, there could be a coalition built to also leave that for more punitive action against iran. iri think that some of these questions will be answered going forward. should watch for all the talk last week was whether or not umpresent trump and president mohanty would be meeting at the united nations, chances of that

have gone from slim to none as analysts have told me. but we will see what goes forth between these relations. >> you raised one question that i don't know if analysts are answering or if you can but when will demand run out? >> there sort of a mixed bag on that. no one is quite clear on that. i think we are talking about demand i don't think will ever run out to be totally honest not in our lifetime or our children's lifetime. the question more is peak. when will the man speak. i think a lot of analysts will point to within the next decade we might be peaking but like appointed to, it all depends on consumer behavior. what petrochemical demands look like what is our plastics consumption. the efforts going on for the trump administration today will be talking about their effort go to roll back emissions standards for automobiles. what impact does that have?

there is a lot of questions going forward. i don't think i want to pinpoint when exactly demand will peak but the overriding sentiment is that it will peak at some point in the near future. >> brian scheid with s&p global plots can follow them if you go to sp global .com oil news senior editor we appreciate the conversation. >> thank you so much. >> present trump and first lady melania trump will host a second state dinner of his administration as he welcomes australian prime minister scott morrison. and his wife jenny morrison. watch guest arrivals and dinner toasts our live coverage begins friday at 6:30 p.m. eastern on c-span on line at c-span3 ãb c-span.org or listen for free on the c-span radio app. >> paul murray is commentator and host of pulmonary life for sky news australia. thank you for being here.>> it's an absolute