It’s my opinion that we mere mortals thinking we can encapsulate the many forces at work in this complex situation in one or two sentences is.....silly.
If you wanted to tell me that that speculating about what’s behind it is fun, like a party game, I’m right there with ya. It’s fun to trade oil stocks, too. Futures, too, even though they can rip your head off.
But I find it kind of presumptuous to think we know or can know the dynamics behind this. If KSA found these results detestable and they hated the idea of losing billions of USDs, aren’t there some big round wheels they could turn clockwise and fix the problem in 10 minutes? And they could buy the crap out of oil futures too, for the runup in prices.
I *do* think that the drop in oil price is an absolutely remarkable and fascinating story and certainly one of the biggest stories of 2014.
I haven’t heard anything more plausible than the explanation that Saudi Arabia wanted to drown its Iran problem in oil so cheap that Iran would begin losing money. And that, because the USA wasn’t helping out any. It looks like Saudi Arabia is getting its wish and it couldn’t happen to a nicer group of Muslim extremists (Saudi Arabia is “officially” moderate).