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The OPECers have lost their leverage. They are almost powerless to influence prices for reasons of not getting along or the ability of shale producers to fill any gap in supply pretty quickly.

The days of OPEC may finally be coming to an end. Three years ago this Saudi Prince saw the writing on the wall. He has been yammering for diversification of the Saudi economy ever since.

From the Globe and Mail in 2013:

The 58-year-old nephew of Saudi King Abdullah made a name for himself as a maverick when he invested in Citibank in 1991 and made a killing by correctly betting the tottering bank would recover.

Now he is emerging as an activist in his home country with a rare public challenge to Saudi Arabia’s political elite, whom he believes are recklessly ignoring economic threats posed by shale oil discoveries in the United States.

The Prince makes this point repeatedly in an interview with The Globe and Mail, one of his first since he rattled global oil markets in July by disclosing on his Twitter account a letter to Saudi Arabia’s Oil Minister. The missive warned that the American shale oil boom would soon threaten demand for crude from members of the Organization of Petroleum Exporting Countries.

New shale oil discoveries “are threats to any oil-producing country in the world,” he says.

In less than two years, Prince al-Waleed says, the United States will be producing so much oil that it will be a competing exporter of crude. Oil prices currently hovering a little below $100 (U.S.) a barrel could sink as low as $80 over the next few years and potentially fall even further if more shale oil discoveries emerge in the United States, Europe and Australia.

“It is a pivot moment for any oil-producing country that has not diversified,” he says. “Ninety-two per cent of Saudi Arabia’s annual budget comes from oil. Definitely it is a worry and a concern.”