[rfp1234]

The President should aggressively campaign on this.

Russia is waging an oil price war against the U.S. and its allies.

Russia wants to hurt a vital sector of the U.S. economy in an election year.

All the Rats’ rants about Russia supporting Trump are B.S.

[glorgau]

Russia wants to hurt a vital sector of the U.S. economy in an election year.

There are other sectors of the economy that would benefit. Kind of a mixed bag.

[Zhang Fei]

[Russia wants to hurt a vital sector of the U.S. economy in an election year.]

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The Russians want more revenues, which you usually get in the oil biz by producing while other guys hold back on production. Putin’s approval rating isn’t underwater, but it’s moving in the wrong direction. Russia is the Saudi Arabia of the north in one sense - both the economy and the government’s budget are hugely dependent on oil revenues.

Both the Russians and the Saudis will come back to the table. Neither can take a 50% oil revenue reduction for very long. Saudi Arabia has far more staying power than Russia, though - (1) its sovereign wealth fund is 7x Russia’s, (2) it has 1/4 the population, i.e. fewer mouths clamoring for a share of the oil revenues and (3) Russian oil, at $20 per barrel in production cost, costs twice as much to pump as Saudi oil.

https://en.wikipedia.org/wiki/List_of_countries_by_sovereign_wealth_funds

MBS is right - the Russian ability to survive $25 oil for any length of is minuscule. Before the price war, oil prices were at $45, yielding $25 a barrel in revenues for the Russians. At a price of $25, the Russians would get $5 a barrel in revenues. How will the Russians plug the 80% decline in revenues?

Whereas the Saudi drop, while serious, is far smaller - $45 - $10 (production cost) yields $35 per barrel pre-price war. Post price war, they get $25-$10 = $15 per barrel. That’s still a 60% drop in revenues, but it’s a lot better that Russia’s 80% decline. And as noted above, the Saudis have a bigger war chest and a smaller population over which to spread the oil revenues.

[Svartalfiar]

Russia is waging an oil price war against the U.S. and its allies.

Russia wants to hurt a vital sector of the U.S. economy in an election year.

Actually, this is more Saudi Arabia waging an oil war on Russia, with OPEC half in the background. Bonus that it hurts Iran. None of this is currently aimed at these US oil production, but it does still hurt.