Posted on 06/02/2022 3:17:12 PM PDT by BeauBo
OPEC+ and its allies agreed Thursday to increase oil production more than expected, opening the door for Saudi Arabia to ramp up its own output if wartime sanctions force Russia to pump less...
The OPEC+ decision comes after sources told the Financial Times that Saudi Arabia is prepared to pump more. Concern over a more dire supply squeeze for crude oil has emerged since the European Union announced its partial Russian oil embargo on Tuesday, as well as a ban on insurance for Russian cargoes that could limit Moscow's exports to markets outside the EU.
(Excerpt) Read more at finance.yahoo.com ...
In yesterday's meeting (June 1), they discussed excluding Russia from the wider OPEC+ group, because they are no longer able to fulfil their assigned production quotas.
Russia is just sending the production shift to India and China. No loss for them. Europe has taken a huge hit on prices for the consumer.
Customers will be falling all over themselves to buy Urals medium sour crude.
I guess June is going to be some rough sledding.
They still haven't imposed an insurance ban, either.
All this stuff is Wimpy optics - "I will gladly pay you Tuesday for a hamburger today!"
Yes,it is a lost to them. India and China aren’t buying all if it, and they are getting it at a steep discount.
will make no difference…a drop in the bucket
The head of Russian oil said was a going to be very difficult and costly to transition delivery to China. Right now ships have to go on 4-5 month routes at extra shipping and insurance ans freight costs. Many shippers don’t want to handle the cargo and come under sanctions themselves. China’s yuan is pegged to the dollar so a stronger ruble make the CHICOMS pay more. Russia doesn’t have enough storage for all the oil backing up and so wells are being shut down. Very difficult to restart those.
It’s a wash as far as consumption.
Hot off the press:
“The UK and the European Union have agreed to jointly shut off Russia’s access to oil cargo insurance”
“It’s hard to underplay how significant a move this is by the UK and EU. Taking out insurance will have a huge impact on Russia’s ability to export its oil. It’s one of the toughest sanctions Europe has in its armoury,” said RBC Capital markets’ Helima Croft, as quoted by the FT.”
Russian warplanes are in the sky day and night burning jet fuel.
Also, the amount of high explosives needed is enormous.
Russia now has an excuse to take out Saudi petroleum exports, which are going to anti-Russian nations.
Russian warplanes could leave Iranian airspace and be at Saudi loading facilities in 40 seconds.
Imagine if we had a leader who loved America as much as the Shah loves Saudi Arabia?
“OPEC is now moving to fill the oil supply gap created by declining Russian exports.”
Their standard monthly increase is 445,000 bbl per day. They’ve been doing that for several months on the rebound from Covid.
They agreed that NEXT MONTH they would increase 668,000 bbl per day, a 50% increase over the planned/scheduled amount.
A drop in the metaphorical bucket.
The Russian embargo took 11% of the world’s oil exports off the market. Over 7.8 million bbl per day. The second largest exporter behind only the Saudis.
This pain is brought to you by America’s neocons and Democrats. But, I repeat myself.
And you are joyous over the damage you and your kind have done to the world oil market, and the price increases you have caused every American.
Neocons!
Putin but licker!
Oil is fungible. It makes no difference whom produces it as the total fungible supply is what determines the price, including our own production of which President Biden is crippling by design and malice. Oddly we should encourage Russia to produce much oil and all should buy it. It will drive the price down and hurt Russia. OIL IS FUNGIBLE. Our sanctions on Russian Oil help them. It drives the price up and even with reduced production today Russia makes much more money than prior on greater production of the past.
The Saudi’s will be most happy to increase supply moderately to make up any Russian shortfalls as this is money in the bank for them. They will not increase it greatly as the Biden Administration oddly supports Iran’s ambitions. The Saudi’s in effect told Biden to “Lets Go Brandon” when he asked them months ago to increase oil production of which they can. They did not.
Circa 1986 oil was about 26 dollars a barrel. In 1986 it hit 12 dollars a barrel. Why did this happen? President Reagan decided to collapse the Soviet Union via Economics. The Saudi’s, The UAE, Oman, etc flooded the world with oil at Regan’s request. The Soviet Union collapsed due to economics. They flooded the world with oil at great economic cost to themselves. They feared Iran and what the Soviet Union was doing in the Middle East. They trusted Reagan and were correct. Today they do not trust Biden and they are correct.
ECONOMICS 101, 202. I just read the book and took a CLEP test. I got an A for both, as world history, botany, biology, government etc. I was in a hurry to graduate.
In 1983, as opposed to 1966 when I flunked out.
“ They (Saudis) agreed that NEXT MONTH they would increase 668,000 bbl per day, a 50% increase over the planned/scheduled amount.
A drop in the metaphorical bucket.
The Russian embargo took 11% of the world’s oil exports off the market. Over 7.8 million bbl per day.”
The Russian oil is phasing out, it did not stop cold.
Other suppliers will be ramping up as the Russians are ramping down, mostly over the rest of this year, but also into next.
That Saudi increase in one month could displace almost 10% of Russian exports. The UAE and Iraq are also capable of relatively rapid increases month to month. Several months of those increases could displace the majority ofRussian exports.
A drop in the bucket of what?
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