Posted on 04/25/2016 2:55:17 PM PDT by 2ndDivisionVet
“WE DON’T care about oil prices,” Muhammad bin Salman, Saudi Arabia’s deputy crown prince, recently told Bloomberg, a news agency: “$30 or $70, they are all the same to us.” Such comments by the man calling the shots in the world’s biggest oil power should be taken with a pinch of salt. Low oil prices cost the country billions, threaten its credit rating and are turning it from creditor to debtor: this week it set out to raise $10 billion from global banks. Yet the claim is not entirely hollow, either. Saudi Arabia is determined not to give any succour to higher-cost producers, despite the damage the low price does to its own finances.
At a meeting in Doha, the Qatari capital, on April 17th Saudi Arabia blocked an agreement between OPEC and non-OPEC producers, such as Russia, to shore up global oil prices by freezing production at January’s level. The idea that such a deal could have been enforced was fantasy anyway. As Carole Nakhle of Crystol Energy, a consultancy, points out, Russia is pumping at record levels and there was no way to police its compliance with a freeze. Iran, which is vowing to raise output to pre-sanctions levels, had dismissed the notion that it would take part as “ridiculous”....
(Excerpt) Read more at economist.com ...
We have been blessed, we only need the will to get our riches.
It would make sense to set a floor (price support ) for US oil. Supporting US producers instead of letting Saudi Arabia and others from shutting down small oil companies from Price Dumping
We need to collapse the middle east oil and bring them back to the 7th century sh##holes and eating dirt and our muslim jihad problem is over
Let them literaly pound sand....
Just wait until President Trump takes office! He will indeed do the right thing and shove America into the top oil producing nations.
If he bombs the Saudi oilfields that would be a bonus.
“It would make sense to set a floor (price support ) for US oil”
Since the United States has ceded large swaths of its sovereignty to foreign interests through trade treaties like GATT and NAFTA we can no longer control our own interests. It is hard to believe that oil is not included somewhere in the commodities that can not be price supported. If, for example, the US tries to protect its steel industry with tariffs or price supports or subsidies we would get taken to a foreign court. I don’t know of any of these cases we’ve won. Once we lose, we either stop the tariff, price support or subsidy or our trading partners get to retaliate on products they import from us. This has proven so politically undoable that we have always conceded.
Incidentally, the low prices have revealed some surprises. Many of those allegedly higher cost producers are still producing at prices they said the couldn’t sustain. But they are, implying that they were lying about their costs, possibly for tax reasons.
I think Saudi Arabia will blink first.
“Incidentally, the low prices have revealed some surprises. Many of those allegedly higher cost producers are still producing at prices they said the couldn’t sustain. But they are, implying that they were lying about their costs, possibly for tax reasons”
Not lying at all. The producers are doing just that - producing. What they are not doing is buying leases, doing seismic studies, drilling delineation and exploratory wells, investing in new equipment and talent, and all the other things necessary for Next Years production. US producers are pumping the existing wells dry to pay their loans off but when it’s gone, it will be over for a lot of marginal producers and maybe some majors.
Shale wells run out, and if they are not actively being replaced, we may see our next president bowing to King Saud.
That approach is on the way.
With the success of fracking in the US, the new “best customer” of the middle east is China.
Those friendly folks with mafia business practices and 1.4 billion people to enforce them.
The next 2 decades won’t be pleasant for the sheikhs.
Even Obambi has begun telling the green/commie truth by using the phraseology ‘keep it in the ground.’ By categorizing plant food, CO2, as pollution, they ‘justify’ their war against Western Civilization. The free flow of oil at market prices means TOO MUCH freedom & prosperity.
Remember when Dick Cheney said “ oil is too low.”
Right at the bottom of the oil market
“Let us rid ourselves of the fiction that low oil prices are somehow good for the United States,” Cheney, who is now vice president, said shortly after introducing his legislation.
Oil prices had plunged to $15 from nearly $40 a barrel in the early 1980s when Saudi Arabia flooded world markets, and Cheney argued the tax was needed to stabilize oil-state economies devastated by the collapse.
Bttt
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