Saudis Walk Out of OPEC

MSN Money ^

[gaggs]

Saudi Arabia walked out on OPEC yesterday, saying it would not honor the cartel's production cut. It was tired of rants from Hugo Chavez of Venezuela and the well-dressed oil minister from Iran.

As the world's largest crude exporter, the kingdom in the desert took its ball and went home.

As the Saudis left the building, the message was shockingly clear. “Saudi Arabia will meet the market’s demand,” a senior OPEC delegate told the New York Times. “We will see what the market requires and we will not leave a customer without oil."

[gaggs]

This is the best news I have read in a long time. Without the Saudis, OPEC is broken. The Saudi's are smart enough to know that OPEC is trying to kill the Goose that laid the golden egg! Maybe they are getting nervous about America drilling for its own oil and ending our dependence on foreign supplies.

This should drive oil prices down even further. Now we can pick and choose whom we get our oil from and we can even restrict oil purchase from certain rogue countries. What was once a Monopoly could turn to competitive pricing. This will be interesting to watch.

Evaluation: Saudis Walk Out of OPEC

[b4its2late]

It’s just over $100 a barrel and needs to go down even more.

[nickcarraway]

Well, there is some advantage in it’s going down from $100 slowly. Namely, it’s good to see the pressure on to develop more supply. Eventually it will hit $20/barrel again, but who knows how long.

[Constitutions Grandchild]

To be honest, I didn’t think they had it in ‘em. I really thought they had joined the rest of the crew bent on shooting themselves in the feet.

If the rest don’t manage to get it, I guess the Saudis will be feeding them and clothing them, because eventually, the rest of us will stop. I’m impressed. I really thought there had been too much inbreeding. I relieved to finally be disappointed by my assessment.

[OldMissileer]

Well, there is some advantage in it’s going down from $100 slowly. Namely, it’s good to see the pressure on to develop more supply. Eventually it will hit $20/barrel again, but who knows how long.

I agree.

While I would like to see much lower gas prices now I want enough pressure to open ALL of our options and get them running, including oil shale.

If the prices drop too fast we will get complacent again and stop domestic drilling.

[r9etb]

To be honest, I didn’t think they had it in ‘em. I really thought they had joined the rest of the crew bent on shooting themselves in the feet.

The Saudi oil guys have got a very finely-tuned sense of self interest. I wonder what's really afoot there.... perhaps a bit of quiet pressure from Western governments? Or, perhaps, bribes?

Or perhaps they want the price to go down for a different reason: it limits Iran's income, and Iran has a definite interest in destabilizing the Saudi government. (For that matter, so might Chavez....)

At any rate, I don't think we can take any action of theirs at face value.

[Uriah_lost]

I hope you’re wrong about that $20/bbl. It needs to be at $60+ to make domestic production more viable. If it falls too far too fast, the Bakken will stop being profitable and confidence will fall in our off shore explorers. I’m afraid that the Saudis are trying to manipulate the market to prevent us from doing what is necessary to make ourselves more independent.

[politicalwit]

Dated Brent is now @ $95.33/bbl however Regular unleaded is up 8.7 cents/gal to $2.749/gal. I believe that this increase reflects the weather situation and refineries being closed down on the Gulf Coast.

[ccmay]

Sarah did it. They’re scared of her.

[VeniVidiVici]

I’m afraid that the Saudis are trying to manipulate the market to prevent us from doing what is necessary to make ourselves more independent.

Just increase your consumption.

[bvw]

I read the Nymex Oil chart to say $60-$70 will be the next level for a while.

[politicalwit]

Eventually it will hit $20/barrel again, but who knows how long.

Ain't gonna happen unless there is a total collapse in the dollar, euro and yen...and I mean a total collapse.

[savedbygrace]

Where is gasoline selling for $2.479?

We’re at $3.389 in NE OK.

[Luke21]

$3.31 at cheaper spots in Tucson, and I thought we were doing good.

[bolobaby]

Earlier this year, I told my wife we’d see $100 by labor day, steady mid $80s by end of the year.

That’s the price our economy can support for any extended period. It’s not an ideal price for us, but we can support mid $80s. Any sustained price point beyond mid $80s is simply damaging enough to the economy that demand will automatically plummet.

[givemELL]

Saudis are making unrestrained headway in US with their ideological agenda. In 2001, approx 900 of the 1200 known mosques were Saudi (Wahabbist/Salafist) funded. Since 2001 approx 57 new mosques a month, mostly Saudi funded, have appeared, and there are now about 6000 mosques in the US. US policy is heavily favored toward Saudi interests. Saudis are now able to be excited about their prospects in regard to one of two Presidential candidates in the US. Helping the US with affordable oil will only strengthen their grip on US foreign and civil policy. The price we are paying for a lack of a nationalistic energy policy for the last 30 years is evident in many other ways also, as all readers on this board already know.

[nascarnation]

2.74 is the wholesale price prior to transportation and taxes

[politicalwit]

Sorry...that’s the wholesale price, not @ the pump.

[Constitutions Grandchild]

If only the rest of the world could be as simpleminded as I am. I'm the female counterpart of Ozark Ike. What you see is what you get. I find it illogical when others dissemble (seems such a waste of time and energy). I never suspect the “dark side” until I'm broadsided, flat on my back looking skyward. ;-)