Posted on 01/21/2015 10:02:40 AM PST by thackney
The Saudi’s did not create the situation, they are just unwilling to fix it by cutting their own revenue to help those OPEC nations that won’t control their spending: Venezuela, Iran, Nigeria, and some others.
I’m just mystified. Wasn’t that the goal of the group? To spike oil prices so that we pay enormously at the pump, and therefore, making super freaking expensive alternatives look cheap? Shouldn’t he be applauding the Saudi efforts to curb global warming, or even more wisely shut up?
Don’t get why he’s giving a warning about this. His solution is cut back production to keep the price high enough to support exploration and development which liberals hate. Sure, it might encourage a LITTLE renewable testing, but not like $200 a barrel oil would.
He is not part of OPEC.
He was part of and speaking at an ‘elite’ conference on global climate change (which used to be warming, until it got cooler, but now it’s warming again, but might be cooling, oh whatever.)
A gathering of liberals to see how they could screw up the world.
The World Economic Forum Annual Meeting is about climate change?
Low oil prices are definitely going to hit Russian, Iran and Venezuela pretty hard.
Lots of folks writing about blaming the Saudis. I haven’t read one that actual gave actions they believed the Saudis took.
I think this is a good short summary of how we got here and the immediate future on the oil price.
http://www.freerepublic.com/focus/f-news/3249158/posts
That could happen again, but I think it’s less likely because of our increased domestic production and the fact that the Chinese economy has been cooling off compared to 2008. The 2008 spike was an aberration anyways.
If you look at Russia...ruble rate has tumbled by a significant amount. Russian billionaires have lost probably around fifteen percent minimum of their fortune since the EU/US put the hurt on business deals. But here’s the curious thing that I noticed a month ago....Russia and China signed a long-term energy deal...oil and gas involved. There will be pipes built and tons of stuff pumped into China. Russia is stable for the next decade.
What can you say for Saudi Arabia? Less China business? Russia still surviving? US sitting there with Canada with oil shale operations and fracking.....to stop either, you have to have barrel prices at less than $60 (some folks still think $50 is the marginal point where zero profit occurs for frackers). Don’t know about oil shale but I’d guess it’s closer to $70.
On top of all that....tons of exploration off coast of Brazil and they will be a big player in five years. Saudis will have five or six “kids” playing the game and unable to compete.
Incredible, the economic ignorance of people....
If there were a shortage, the price would rise, prompting more production, alleviating the shortage.
That’s the way it always works.
As was the 2009 dip 6 months later.
Just like when prices fall, the demand will rise and the production will fall.
But it doesn’t happen overnight. In the short term, both demand and supply of oil is rather inelastic.
Not a chance.
“The Saudi’s did not create the situation, they are just unwilling to fix it by cutting their own revenue to help those OPEC nations that won’t control their spending: Venezuela, Iran, Nigeria, and some others.”
Correct.
(AGI) - Berlin, Aug. 26 - After having a protagonist role for peace in Lebanon Italy asks to take part in the 5+ 1 group that negotiates with Iran on nuclear. Foreign minister, Massimo D'Alema in an interview to "Frankfurter Allgemeine Zeitung" asks a place near to the five permanent members of the UN Security Council. "We are Iran's most important commercial partners with Germany and we are pledged in Lebanon with Hezbollah. So we have the right to be included in the negotiation with Iran. The goal is not a new conflict but talks aimed at preventing Iran from having an atomic bomb, he said. Italy searched for a greater G8 involvement in the negotiation with Iran but it remained excluded from the 5 plus 1, the group that started a negotiation with Tehran offering incentives in exchange for the suspension of the uranium enrichment program. This exclusion was due to the fact that Rome was not part of the European trio (France, Germany and UK) that had tried the first mediation with Tehran and represented the EU in the 5 plus 1. D'Alema remembered that the United Nations and the EU had not a role in the Iraqi crisis, and warned that the new opportunity in Lebanon could not be missed now. "It is a very difficult mission full of unknown points but it is worth pledging or the only alternative would be a new burst of war" he said. The foreign minister, was sceptical on the possibility of a new UN resolution for the mission in Lebanon asked by the US. "I'm sceptical about it, because in these situations they always open long negotiations. The strategic plan is clear and the resolution was completed defining the rules of engagement. If they will make a new resolution soon I agree with them but the most important thing is getting there as soon as possible (In Lebanon)" he said.
That comment was prompted by the information about Iran’s high break-even price in the link you posted. Thanks.
Note that is not break even price to produce their oil, but break even price to match their government spending.
You probably understood that already but some folks have misunderstood.
Thank you.
It will likely spike at a new high because the dollar will be worth less (again).
The vehicle demographic will have shifted (back) toward larger and less economical vehicles because they will be cheaper to drive in the interim.
The supply of used vehicles from the 'boom' will be (at least from looking around these parts) fleet pickups (4WD 4-door, 1/2 to 1 ton), Suburbans, Escalades, and large SUVs, and not a few heavy trucks (mainly semi tractors).
When you weigh the price break versus fuel consumption for a good used vehicle, the larger vehicle can win handily, even when fuel prices are high. It depends on driving conditions and what the buyer wants.
Not all areas of the country are burdened with emissions checks and the like, so there will remain a good market. (Air quality issues vary locally depending on terrain and population density. Minot, ND is a totally different situation from Denver or L.A.)
Break-even at current output levels. Could they just pump more oil?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.