Recent upheavals in the oil market, most notab ly the growth in North American unconventional oil and the evolving response of OPEC, are prompting a re - appraisal of conventional wisdom across a number of areas. Though analysis has tended to focus on global dynamics, many of the oil market’s defining ch aracteristics are determined by regionalized micro - competition. This article explores evolving supply dynamics in the U.S. Gulf Coast, the most important refining hub and single largest source of heavy oil refining capacity. The implications of these evolv ing dynamics hold repercussions for the debate over the Keystone XL pipeline, Saudi Arabia’s ability to maintain a foothold in the North American market, and the heightened competition among heavy crude oils in the Western Hemisphere. It is suggested that U.S. policymakers place their ultimate focus not upon individual pieces of infrastructure, but instead upon establishing strategic priorities for managing the new and dynamic supplies of oil – including heavy oil – that is competing for refinery capacity i n North America.
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