Many U.S. producers say they can turn a profit at $50 a barrel and even as low as $30 in the Permian’s most productive regions. Yet most OPEC members need prices ranging between $70 and $90 per barrel to balance their budgets.
It's not just OPEC that is breaking, the EU sources 45 percent of its petroleum from gangster-run Russia.
The spread of illiberal ideology is threatening the euro, but it is an illusion that leaving it would offer an easier path, European Central Bank President Mario Draghi said on Saturday... Draghi, credited with saving the euro in the worst of Europe's crisis, called for deeper private risk sharing, the completion of the banking and capital market unions and argued for euro-wide backstops that could help the bloc’s weaker members in case of market stress.
OPEC Has Already Turned to the Euro
GoldMoney Alert
February 18, 2004
...The source for the euro exchange rate is the Federal Reserve, and I have calculated the euro's average exchange rate to the dollar for each year based on daily data.We can see from column (4) in the above table that in 2001, each barrel of imported crude oil cost $21.40 on average for that year. But by 2003 the average price of a barrel of crude oil had risen 26.0% to $26.97 per barrel. However, the important point is shown in column (6). Note that the price of crude oil in terms of euros is essentially unchanged throughout this 3-year period.
2001
As the dollar has fallen, the dollar price of crude oil has risen. But the euro price of crude oil remains essentially unchanged throughout this 3-year period. It does not seem logical that this result is pure coincidence. It is more likely the result of purposeful design, namely, that OPEC is mindful of the dollar's decline and increases the dollar price of its crude oil by an amount that offsets the loss in purchasing power OPEC's members would otherwise incur. In short, OPEC is protecting its purchasing power as the dollar declines.
(that will leave Algeria, Angola, Congo, Ecuador, Equatorial Guinea, Gabon, Iran, Iraq, Kuwait, Libya, Nigeria, Saudi Arabia, United Arab Emirates, and Venezuela)
Just like US!
From 1946-1992, the Bretton Woods agreement was a strategic alliance whereby the United States by the guarantor of open shipping lanes, offer finance and agree to reduced tariffs.
Even if the trade did not benefit the US directly, it did benefit it’s associate countries which promoted stability. It was, essentially, an alliance built out of bribes.
Countries who signed on had to “pick a side” (the US), abandon it’s old colonial structures (which resulted in countless wars for resources) and sign up for various trade & military treaties. The result was that old enemies no longer had an incentive to fight openly but instead take their arguments to the courts or negotiating table.
It worked. By 1992, a large chunk of the world signed up to deal the biggest of which was flipping China to the west. Countries rebuilt from their wars and enhanced their standard of living.
But Bretton Woods had outlived it usefulness. The cold war was over and the US realized it was time to reassert itself by slowly breaking away from the compact.
When the current system goes teets up, America will become the “least dirtiest shirt in the hamper”.
1. Protecting the world’s sea lanes
2. Has cheap energy prices...and is now an exporter
3. A history or property rights
4. Rule of law
5. Inputs, through-puts and Outputs
6. A safe place to build your factories, store your assets and safeguard your patents
7. Extensive navigable river systems which are connected to a central port
8. Productive agriculture lands which feeds the world
9. Source of customers, finance and investors
10. A productive demographic which has an upcoming replacement generation (where other places do not).
11. A place where if you want these benefits, you’ll have to offer a “gift”.