Saudi Arabia Admits To A Full-Blown Liquidity Crisis

Zerohedge ^ | 5/18/2016 | Tyler Durden

[Braak]

Previously we documented that as a result of the still low oil prices, largely a result of Saudi Arabian strategy to put high cost producers out of business and to remove excess supply, none other than Saudi Arabia has been substantially impacted, with the result being dramatic state budget, a sharp economic slowdown and mass worker layoffs.

Just three weeks ago we reported that the biggest construction conglomerate in the middle east, the Saudi Binladin Group had announced it would layoff 50,000 workers ot a quarter of its workforce, slammed by the weak economy.

Now, Saudi Arabia has admitted that in addition to acute economic problems, which will manifest themselves most directly in a soaring Saudi debt load...

[Braak]

True, but one would have thought the Saudis were smart enough to think of a thing called a “rainy day fund”...oh wait...we haven’t done that either.

[Braak]

True, but one would have thought the Saudis were smart enough to think of a thing called a “rainy day fund”...oh wait...we haven’t done that either.

[cpdiii]

Oddly enough Saudi did us a great favor. We have been getting cheap oil for the last year and a half. We know how to frac wells and bring on vast quantities of oil at the right price. The Fracking industry has gotten lean and mean. Market forces do work and they are working against the Saudis.

Many companies went bankrupt do to the low cost of oil. When oil hits fifty to sixty dollars and stabilizes at that price for a length of time, companies will spring up like weeds and drill, and frac and produce our oil.

[clearcarbon]

"The Fracking industry has gotten lean and mean."

By necessity, the mother of innovation and invention. They persevered even as the administration tried to kill them It's ironic that fracking may have helped rescue the same maladministration from consumers furious about high energy prices.

[Chaguito]

I can live with a total travel ban, as long as they keep their little internecine spats in the Middle East.