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Grey Area posted:It's the Saudis doing this. They are trying to destroy the North American fracking business, Iran and Russia, all of which have far less money in the bank than KSA. Exactly. The Saudis are playing a big gamble and are doing this deliberately to try and destroy the Shale exploration markets. The problem is for them, they were likely banking on them starting to go under when it was at $50, but ways its looking its going to need to go a lot lower. Seen forecasts for anything between $20 to $10, e.g. RBS said in its weekly note to investment clients they are predicting the bottom at around $16. Bigger issue is how this is completely loving over the oil producing countries who can't weather this e.g. Venezuela and especially Russia. Some estimates have Russia having a daily deficit of $1 Billion US due to the tanking of the oil price, and it can't whether it for long. Really the obvious solution to this for Russia would be to try and force the price back up but the only way that would be possible would be to cause a massive production decrease of a major supplying nation e.g. the US (currently biggest and getting bigger) or Saudi Arabia. ^ RE: Aramco, don't believe its for sale yet, as Saudis reportedly have a lot of cash reserves, but they will be planning in case this doesn't resolve and the US keeps pumping more and more Oil. ukle fucked around with this message at 17:18 on Jan 12, 2016 |
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Jan 12, 2016 17:15
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| # ¿ May 22, 2024 18:23 |
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Brent Crude (the real international measure for prices now) is approaching $30 a barrel; price for oil has been very chaotic today. If the oil market doesn't shift its instability soon the rest of the markets will follow. Support level seems to be at $30.40, guess if it breaks through that then it could get interesting. ukle fucked around with this message at 20:26 on Jan 12, 2016 |
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Jan 12, 2016 20:23
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icantfindaname posted:Only 13% of world oil production comes from SA, they don't have power to set prices. Most of the crash in oil prices has not been caused by SA flooding the market. And what's more, none of the oil producers can afford to cut production, because they all need the money for wars They did have the power to set prices historically. They always had more production capacity than they used this enabled them to keep demand in check with supply as while most other countries couldn't afford to cut supply due to budget constraints the Saudis used to play it safe. The problem is they have become careless and allowed their budget to increase to where it now needs a significant price of oil to be maintained so they can't afford to cut any production and are seemingly running at full capacity (hard to tell with Aramco though). Also even if they did cut production now it would have little impact unless they cut production by a half as the supply glut is so significant along with the amount in storage. They were the ones who started it but they have no control over it now.
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Jan 12, 2016 22:23
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Oil crashed through the $30 barrel today, and its now looking at crashing through $29, Brent keeps going through the $29 point and back out again. At least its the Weekend soon so the traders can be calm for a few days.
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Jan 15, 2016 20:21
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Just need vilerat to be resurrected so we have a good OP if its a true sequel.
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Jan 21, 2016 00:24
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And there goes the last 2 weeks of gains. Over 6% drop so far today, Brent crude is down to $30.44 at moment.
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Feb 9, 2016 19:33
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| # ¿ May 22, 2024 18:23 |
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Its specifically a very bad deal, if you were hoping for any of them to actually do anything. As everyone has already pointed out they really don't have the power to do anything and were hoping saying this would at least improve the price but its done the opposite as Brent has lost over $3 a barrel since the announcement. All this announcement has shown is that they are powerless, which will potentially destabilise the markets further.
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Feb 16, 2016 17:11
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