Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Mitsui CEO: U.S., Saudis Pushing Oil Prices Lower, Working Together to Hurt Islamic State and Russia
Wall Street Journal ^ | Dec. 17, 2014 | PETER LANDERS And MARI IWATA

Posted on 12/18/2014 5:26:45 AM PST by thackney

The head of Mitsui & Co., a big energy investor, said he thinks the U.S. and Saudi Arabia are working together to keep oil prices down in an effort to hurt Islamic State and Russia.

Masami Iijima, chief executive of the Japanese trading company, spoke in an interview as crude oil was trading near its lowest level since May 2009. He said the recent decision by the Saudi-led Organization of the Petroleum Exporting Countries to keep production at current levels, which triggered the oil-price plunge, would particularly hurt Islamic State, the militant group that has seized parts of Iraq and Syria, including some oil fields.

“They’ve been selling oil to a certain extent at a discount, and the advantage of that discount has now completely disappeared” because inexpensive oil is available elsewhere, he said in an exclusive interview with The Wall Street Journal. “It has the effect of cutting off Islamic State’s source of funds.”

Mr. Iijima said of the fall in oil prices: “I have a feeling that Saudi Arabia and the U.S. are moving ahead with this as part of substantial mutual discussions.”

Representatives of the U.S. and Saudi embassies in Tokyo didn’t immediately respond to requests for comment. Saudi officials have said they base their decisions on economics, not politics.

Saudi Arabia and the U.S. are allies in working to stop Islamic State’s spread, while the U.S. has led the effort to impose sanctions on Russia, a major oil producer, over its aggressive actions in Ukraine.

Growing U.S. energy independence is helping feed Washington’s harder line on Moscow, Mr. Iijima said. “The way the U.S. is beating on Russia is amazing,” he said. “It’s no problem for them if they don’t get any energy from Russia.”

(Excerpt) Read more at wsj.com ...


TOPICS: News/Current Events
KEYWORDS: energy; oil; opec
Navigation: use the links below to view more comments.
first previous 1-2021-32 last
To: exit82

You are welcome.


21 posted on 12/18/2014 6:17:40 AM PST by thackney (life is fragile, handle with prayer.)
[ Post Reply | Private Reply | To 18 | View Replies]

To: mac_truck
Sorry, forgot to reply to your other claim.

No oil was taken out of the global supply chain

The area ISIS took control of reduced oil production from ~300,000 BPD to ~50,000. The global oil supply was reduced by their actions.

22 posted on 12/18/2014 6:19:11 AM PST by thackney (life is fragile, handle with prayer.)
[ Post Reply | Private Reply | To 17 | View Replies]

To: thackney

If you want to control these oil prices world wide, start working to control the price of FOOD. Might be a whole different ball game.


23 posted on 12/18/2014 6:27:00 AM PST by DaveA37
[ Post Reply | Private Reply | To 22 | View Replies]

To: DaveA37

How would you do that, and why?


24 posted on 12/18/2014 6:32:10 AM PST by thackney (life is fragile, handle with prayer.)
[ Post Reply | Private Reply | To 23 | View Replies]

To: thackney

Did you think that maybe, just maybe Obama and the Saudi’s are working together to hurt the US Shale Oil business? Hmmmmmmm? Kinda obvious isn’t it?


25 posted on 12/18/2014 6:32:37 AM PST by nikos1121
[ Post Reply | Private Reply | To 1 | View Replies]

To: nikos1121

No. I don’t think so.


26 posted on 12/18/2014 6:33:05 AM PST by thackney (life is fragile, handle with prayer.)
[ Post Reply | Private Reply | To 25 | View Replies]

To: thackney
Saudi oil production is actual down from last year at this time.

End of story.

27 posted on 12/18/2014 6:47:19 AM PST by FreeReign
[ Post Reply | Private Reply | To 10 | View Replies]

To: thackney
The area ISIS took control of reduced oil production from ~300,000 BPD to ~50,000.

What you're not accounting for above is the 100,000+ bpd ISIS was reportedly selling at the discounted price of $25 per barrel.

Of course we also have no idea how much more oil was being sold at $25 a barrel under the guise of ISIS or who was really doing the selling... only that shortly there after the price of oil worldwide plunged toward $25.

That looks very much like the proverbial straw that broke the camel's back for oil pricing.

28 posted on 12/18/2014 6:53:20 AM PST by mac_truck ( Aide toi et dieu t aide)
[ Post Reply | Private Reply | To 22 | View Replies]

To: mac_truck
What you're not accounting for above is the 100,000+ bpd ISIS was reportedly selling at the discounted price of $25 per barrel.

You will have to show me where they were actually selling that much oil.

But even if true, when the area was producing 300,000 barrels a day before them, and is reduced to 100,000 barrels a day while they are there, the net result to the global oil price is less supply. Less Supply in the market will raise prices if demand is unchanged. Just because some scumbags in Turkey bought oil for $25 from ISIS and then sold it to others at market price, doesn't lower the global price of oil.

29 posted on 12/18/2014 6:56:54 AM PST by thackney (life is fragile, handle with prayer.)
[ Post Reply | Private Reply | To 28 | View Replies]

To: thackney
Its been widely reported that ISIS was selling $2-3million dollars of oil per day or roughly 100-150K bpd. here .
30 posted on 12/18/2014 7:14:20 AM PST by mac_truck ( Aide toi et dieu t aide)
[ Post Reply | Private Reply | To 29 | View Replies]

To: mac_truck

From your links:

Meanwhile, as I reported at the beginning of September, ISIS’s oil production and distribution network is not what it was just a few months ago, when up to 70,000 barrels of crude was finding its way onto the black market.

Cohen from the U.S. Treasury suggests — using his revenue number of a million dollars — that production has been reduced to 25,000 barrels and that the Assad regime is still on the receiving end of that ISIS-controlled oil.

http://edition.cnn.com/2014/10/27/business/isis-wealthiest-terror-group-defterios/

- - - - - -

Headlines are often misleading. Into those articles you find:

The $1 million a day figure is coming out of the Iraqi fields of which they have control. Iraq and Syria together could reach up to $3 million a day

http://abcnews.go.com/International/isis-makes-million-day-selling-oil-analysts/story?id=24814359

- - - - -

The territory ISIS controls in Iraq alone is currently producing anywhere from 25,000 to 40,000 barrels of oil a day, which can fetch a minimum of $1.2 million on the black market, according to Luay al-Khatteeb, a visiting foreign policy fellow at the Brookings Doha Center, who also directs the Iraq Energy Institute. Some estimates have placed the daily income ISIS derives from oil sales at $2 million, though American officials are skeptical it is that high.

http://www.freerepublic.com/perl/post?id=3238501,30

- - - - - - - - - - - - -

Three questions please:

Do you believe the oil production went up or down with ISIS?

How does a commodities market react to a reduction of supply?

Do you believe smugglers that risked buying from ISIS passed their savings onto their buyers, or sold at market prices?


31 posted on 12/18/2014 7:25:50 AM PST by thackney (life is fragile, handle with prayer.)
[ Post Reply | Private Reply | To 30 | View Replies]

To: thackney
The price drop is not from Saudi putting more oil on the market. Only the US, and to a smaller amount Canada, have made significant oil production increases.

Thank you; that would be another plus for the analysis of "stupid" in my previous message.

This administration is far less clever than most of our allies (or at least the allies of the US, if not the administration) seem to think. It doesn't surprise me that Mitsui's CEO would attribute such cleverness to the administration, because Japanese business leadership is quite adept at "clever" and thinking very-long-term, including multi-generation-term, so it would not occur to him that the ones he has been told are the best and the brightest in our country, meaning the Obama administration, could be so incompetent at leadership.

32 posted on 12/18/2014 7:40:29 AM PST by chajin ("There is no other name under heaven given among people by which we must be saved." Acts 4:12)
[ Post Reply | Private Reply | To 14 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-2021-32 last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson