Posted on 04/02/2023 8:58:21 AM PDT by dynachrome
Ministry of Energy official stated that the Kingdom of Saudi Arabia will implement a voluntary cut of 500 thousand barrels per day from May till the end of 2023 in coordination with some other OPEC and non-OPEC Participating Countries in the Declaration of Cooperation. This voluntary cut is in addition to the reduction in production agreed at the 33rd OPEC and non-OPEC Ministerial Meeting on October 5, 2022. The Ministry of Energy official emphasized that this is a precautionary measure aimed at supporting the stability of the oil market. --SPA
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Thanks be to The JoeTatoe!
They cut barrels last year. They cut barrels the year before. Rinse and repeat. Even Mexico was supposed to have cut barrels to punish us for something or other because, I dunno, maybe taking in 99% of their rabble.
Price is not very predictive of production. Geology much more so. Ditto population.
This will teach: https://ourworldindata.org/grapher/world-crude-oil-price-vs-oil-consumption
Note that is not $$ per barrel. It is $$ per cubic meter. Also, 2021 dollars so inflation back adjusted.
The horizontal axis is consumption — which you cannot do unless it is produced. So it’s a good longterm surrogate for pure production, and note there is no pure anything since people can put oil in storage. Storage above ground isn’t much different than Storage below ground.
Note how production (consumption) steadily increases regardless of price.
So stop with worrying about price. Oil is the ONE THING that exposes the reality that money is created by whimsy out of nothingness by Central Banks like our Federal Reserve. Oil is the item that has value defined by joules. Not dollars. Not Yuan. Joules. There is no whimsical value associated with joules.
And so, UNDERSTAND THIS. Oil is everything. Everything. Civilization’s lifeblood. Oil is constantly subjected to attempts at redefinition. When shale arrived on the scene, “oil” suddenly included what used to be called condensate. It is that thin. Non viscous.
For gasoline, not a problem. Diesel, Jet Fuel, asphalt, heavier fuel oil, big problem. Bottom line — shale oil is not the same as, say, oil from the Gulf of Mexico. It has different constituent parts.
And so, no, domestic production, now mostly shale, doesn’t increase with price, per the graph. It CAN run out. Check out Indonesia’s domestic production over decades.
Sounds like the Saudi government, like most governments in the world now, are PUTIN PUPPETS. In this case, the Saudis are causing prices to rise, no doubt after being told by PUTIN to do it.
Great Post!
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