Post Reply OPEC says to U.S. "Please don't pump so much oil; you're making us poor"
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Hoosierville
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Posted 5/28/17
I hope the Saudis to bankrupt. They have screwed us far too many times for me to care about them

http://archive.is/OFMZN



OPEC has asked a favor of other major producers: Please stop pumping so much and help us balance the market.
The unusual plea was issued Thursday in the cartel's closely-watched monthly report, which found that global markets are still suffering from too much supply.
The report said that balancing the market would "require the collective efforts of all oil producers" and should be done "not only for the benefit of the individual countries, but also for the general prosperity of the world economy."

OPEC said that one producer in particular is to blame: The U.S., where shale producers have continued to ramp up their drilling despite lower crude prices.
The increased production has undermined OPEC's efforts to keep prices between $50 and $60 per barrel.
OPEC and allied producers agreed in November to slash production, a move designed to rid global markets of excess supply. For a while, the strategy appeared to be working, with prices drifting north of $54 earlier this year.
Now, the magic appears to be wearing off.
The cartel has responded to the sharp decline in prices by suggesting that the agreement could be extended far beyond its original mid-year deadline.
But that won't help OPEC solve its American problem. The U.S. did not join its agreement, and the number of rigs in operation there has doubled over the past year.
"I think [OPEC] are now acutely aware that they don't have the kind of influence they used to have 10 years ago, and that shale is now the swing producer in the market," Tom Pugh, commodities economist at Capital Economics, said last week.
OPEC is out of options: How low can oil prices go?
The cartel has in the past fought fiercely for its market share. Starting in 2014, it pumped relentlessly in order to squeeze higher cost American producers.
The strategy pushed prices well below $30 per barrel and forced many U.S. producers to scale back in 2015 and 2016.
But it had a disastrous effect on the government budgets of OPEC members, forcing them to implement austerity measures.
It also forced U.S. producers to become more efficient, and they can now withstand much lower prices than just a few years ago. Analysts at UBS estimate that U.S. producers can now make money as long as prices remain above $40 per barrel, down from $65 in early 2014.

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52 / M / In
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Posted 5/28/17

if they go bankrupt who is going to pay for that 100 billion dollar weapons deal?
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Hoosierville
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Posted 5/28/17 , edited 5/28/17

uncletim wrote:


if they go bankrupt who is going to pay for that 100 billion dollar weapons deal?


NATO when they pay their fair share. Everyone is suppose to spend 2% of GDP


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52 / M / In
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Posted 5/28/17

But that money should go to NATO and not to prop up a deal Trump made without regards on who is going to pay
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F
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Posted 5/28/17 , edited 5/28/17
I agree that the US should stop supplying Saudi Arabia with weapons, money, logistical support, and so forth given their abysmal human rights record and, as you rightly point out, their support of international terrorist organisations.

I disagree, however, that it should do so while driving up domestic oil production. Rather, I'd prefer to see deep investment in alternative energy sources, greater stress on non-petroleum based lubricants, plastics, and such, measures taken to mitigate negative health impacts on workers in the fossil fuel industry, and reeducation, training, and public works opportunities for labourers transitioning out of fossil fuel production into clean energy production. I'd also like to see waterway, reservoir, and soil cleanup projects massively increased in places negatively impacted by fossil fuel production.

Edit: Changed "by" to "while".
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M
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Posted 5/28/17
OPEC can ask and we are free to choose our best interest financially or otherwise.

NATO has target percentages of GDP, but it also has bases and other commitments. What Belgium commits on the percentages in the past for hosting the HQ facility and associated facilities for being a nuclear weapon aim-point, if anyone tries to prevent NATO's response they are a first target. Other national members have been given unofficial breaks due to other interests. However, I do agree with the proposed amount 2% as the preferred minimum. I am offering this as an explanation for the past compensation and not an excuse for the future.
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