Putin threatens NATO & EU ?
Good job GSFG and Wester Direcroate aren't still around or you could see a 'Red Storm Rising'
One last point: Here in the States the concept of "drill here, drill now" as a means to reduce oil prices and reduce our oil dependency was laughed to derision by the left. I just paid $2 per gallon for gasoline. Looks like all the oil coming on line is doing exactly what our leftists said never would or could happen.
That the Saudis have recently chosen to not cut production meets two of their needs: their revenue keeps coming in, and their marginally profitable competitors are put in a tougher position, cash flow wise, in the short to mid term. The oil business remains competitive.
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Lonewolf
isn't that the point Ken's making? A competitive market is good for the consumer and with the US and Canada's new and significant contribution the OPEC cartel is effectively neutered. Saudis need oil at 80 -100 per barrel, they have taken the decision not to cut production primarily to maintain market share. Their secondary considerations are to hurt investment in fracking and some local payback. The long and short of it is that we have some breathing space to develop less carbon-dependent energy strategies.
All this hurts Putin, will make him weak at home and has little to do with sanctions. He can howl away to his heart's content, he can't fight the economics and the Chinese have said they won't bail him out.
isn't that the point Ken's making? A competitive market is good for the consumer and with the US and Canada's new and significant contribution the OPEC cartel is effectively neutered. Saudis need oil at 80 -100 per barrel, they have taken the decision not to cut production primarily to maintain market share. Their secondary considerations are to hurt investment in fracking and some local payback. The long and short of it is that we have some breathing space to develop less carbon-dependent energy strategies.
All this hurts Putin, will make him weak at home and has little to do with sanctions. He can howl away to his heart's content, he can't fight the economics and the Chinese have said they won't bail him out.
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Bigbux,
Have the Chinese actually said that? If so, it would surprise me, they want (need, now?) to become the de facto World Bank. The Russian crisis would allow them to use reserves currently earning them nothing and allow them to drive a hard bargain into areas they want to diversify into. It might be they know that Russia has no one else to turn to now, Putin's intransigence and inability to accept the reality.. just one last hurrah.
Have the Chinese actually said that? If so, it would surprise me, they want (need, now?) to become the de facto World Bank. The Russian crisis would allow them to use reserves currently earning them nothing and allow them to drive a hard bargain into areas they want to diversify into. It might be they know that Russia has no one else to turn to now, Putin's intransigence and inability to accept the reality.. just one last hurrah.
Falkland Islands defence review after military deal between Russia and Argentina | UK | News | Daily Express
The only point I can pull the reporting up on here is the claim that its recent defence cuts which have left a force of only 4 Typhoons? Did the journalist in question not enquire as to how many Fighters used to be based there? He would surely have been told, just the 4 sir, of any type post-conflict?
FB
The only point I can pull the reporting up on here is the claim that its recent defence cuts which have left a force of only 4 Typhoons? Did the journalist in question not enquire as to how many Fighters used to be based there? He would surely have been told, just the 4 sir, of any type post-conflict?
FB
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Big bux:
I don't think the Saudis ever "need" the price to be that high.
It's a matter of profit margin per barrel, not "are we making or losing money per barrel if producing at that price" ... which is a concern for some other producers.
That said, I am sure they'd rather get as much profit per barrel as they could (who wouldn't?) but reducing production at the moment would enable some of their competitors to "overproduce" without a consequence. By keeping their production up, the Saudis are allowing a bit of pain to be felt by some who are not playing along.
There are politics involved in a lot of this, not just market/economics.
I don't think the Saudis ever "need" the price to be that high.
It's a matter of profit margin per barrel, not "are we making or losing money per barrel if producing at that price" ... which is a concern for some other producers.
That said, I am sure they'd rather get as much profit per barrel as they could (who wouldn't?) but reducing production at the moment would enable some of their competitors to "overproduce" without a consequence. By keeping their production up, the Saudis are allowing a bit of pain to be felt by some who are not playing along.
There are politics involved in a lot of this, not just market/economics.
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Have the Chinese actually said that?
Actually, you are right to call me on that. They said they would provide financial assistance only if officially called on to do so - which is not a refusal, but an offer! (got caught up in the context of the article which was not primarily about finance). They were also making noises about the importance of keeping Putin in power - which would fit well your analysis. If someone else gets in then Russia's economy might stand a chance.
Actually, you are right to call me on that. They said they would provide financial assistance only if officially called on to do so - which is not a refusal, but an offer! (got caught up in the context of the article which was not primarily about finance). They were also making noises about the importance of keeping Putin in power - which would fit well your analysis. If someone else gets in then Russia's economy might stand a chance.
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LW
Russia faces oil export catastrophe, snared in Opec price trap - Telegraph
I agree with you on that. My assumption on the Saudi "need" was a budget break-even. But they do have deep pockets.
Russia faces oil export catastrophe, snared in Opec price trap - Telegraph
I agree with you on that. My assumption on the Saudi "need" was a budget break-even. But they do have deep pockets.
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the Saudis can produce at price levels so far below everyone else and still turn a profit it's untrue
It also reminds the US of their "old friends" in the Middle East and a touch of the whip on shale oil producers, who, even if the price comes back, will have more trouble raising cash in the future
Secondary, but also benifical results from a Saudi view, is it puts internal pressure on Iran and Russia (they could care less about Venezuala) and it makes the contracting business reduce its exhorbitant prices
lots of wins and not many losses for them TBH
It also reminds the US of their "old friends" in the Middle East and a touch of the whip on shale oil producers, who, even if the price comes back, will have more trouble raising cash in the future
Secondary, but also benifical results from a Saudi view, is it puts internal pressure on Iran and Russia (they could care less about Venezuala) and it makes the contracting business reduce its exhorbitant prices
lots of wins and not many losses for them TBH
The long and short of it is that we have some breathing space to develop less carbon-dependent energy strategies.
We'll see what the price per barrel is in April.
Ecce Homo! Loquitur...
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LW
I'm not suggesting that there is an out of the box, single solution that can replace oil - I don't think there is- yet. But we can reduce our reliance on oil, and we should do for more reasons than just political ones.
We are already seeing markets react to the need for efficiency; you can buy 3 cylinder, turbo-charged Fords with all the performance of "traditional" cars that produce less than 100g /l CO2. Pretty much all audis have regenerative technologies as standard.
If as a windy, rainy, rubbish-producing, tidal sea-surrounded country we can't see more opportunity for energy conversion to power our cities then we deserve to be held ransom by our suppliers.
I won't go into climate change.
I'm not suggesting that there is an out of the box, single solution that can replace oil - I don't think there is- yet. But we can reduce our reliance on oil, and we should do for more reasons than just political ones.
We are already seeing markets react to the need for efficiency; you can buy 3 cylinder, turbo-charged Fords with all the performance of "traditional" cars that produce less than 100g /l CO2. Pretty much all audis have regenerative technologies as standard.
If as a windy, rainy, rubbish-producing, tidal sea-surrounded country we can't see more opportunity for energy conversion to power our cities then we deserve to be held ransom by our suppliers.
I won't go into climate change.
