U.S. Returns Fire in Saudi Arabia’s Oil War

[twomp]

U.S. Returns Fire in Saudi Arabia’s Oil War

Not sure if this should go here in the Economy section or in the Foreign policy area but I figure people here would dissect this better.

One day after Saudi Arabia declared war on U.S. oil producers by lowering prices in an attempt to dump cheap crude in the United States (US) market, the White House and private oil companies responded. White House spokesman Josh Earnest said that the U.S. is monitoring the global oil supply and demand situation but has no comment on whether it might look at replenishing the Strategic Petroleum Reserve. Then, later in the day, the Wall Street Journal reported that BP is going to export ultra-light crude without the permission of the U.S. government in a move that not only starts to breakdown the US export ban, but also is a direct challenge to OPEC and other producers for market share. Both of these developments temporarily gave support to the petroleum complex, but it still was not enough to overcome the perception of overwhelming supply and Bank of Japan Gov. Haruhiko Kuroda’ s prescription against the disease deflation.

Let us start with the White House comment on the Strategic Petroleum Reserve (SPR) that was obviously a thinly veiled message to Saudi Arabia. It was an attempt by the White House that they were not very happy with the Saudis price discounts and to remind them that there are steps that the U.S. can take to retaliate in the production war. Up until yesterday sources in SPR had said that the White House was actually looking into reducing the size of SPR, which currently holds about 690 million barrels by about 10 million barrels to about 590 million barrels. The need for SPR oil has been reduced because of the rise in US oil production. The Saudis feared that the U.S. dumping 10 million barrels of heavy crude into an oversupplied market would cut right into their bottom line.

Now what the U.S. may do is buy crude to offset a price collapse caused by Saudi dumping and support U.S. shale producers. It could also go further, tacking on a tax on Saudi oil, an issue that would at some point go before the world trade council. Of course, we are not there yet, but that was the message.

read the rest here:

http://peakoil.com/publicpolicy/u-s-returns-fire-in-saudi-arabias-oil-war

 

[Brian4Liberty]

It was an attempt by the White House that they were not very happy with the Saudis price discounts...Now what the U.S. may do is buy crude to offset a price collapse caused by Saudi dumping and support U.S. shale producers. It could also go further, tacking on a tax on Saudi oil, an issue that would at some point go before the world trade council. Of course, we are not there yet, but that was the message.

Well, well, well. Look at that.

 

[dannno]

The government is fighting to keep oil prices high.. fuck that shit.

 

[Brian4Liberty]

Several weeks ago, when oil prices started to drop a bit, one of the corporatist shills employed over at CNBC reacted in dismay. "What will happen to the oil companies? Will the energy sector drop? They employ a lot of people, dropping oil prices could destroy the economy."

Of course they conveniently forget about the burden of increased energy costs on pretty much every other area of the economy.

 

[Brian4Liberty]

Fox is the source for this story:

U.S. Returns Fire in Saudi Arabia's Oil War
By Phil Flynn - November 05, 2014

http://www.foxbusiness.com/markets/2014/11/05/us-returns-fire-in-saudi-arabia-oil-war/

 

[ILUVRP]

screw the saudies , let oil go to about $40/ba where it belongs . then the bad guys in the arab world will go back to herding goats as their money dries up .

the oil companies have made trillions of $$$$$$$$$$$$ fron oil that was way over priced , now the goverment wants to keep pumping money to big oil .

there is really no difference between the d's and r's .

i am sick of all this bs .

 

[pcosmar]

screw the saudies , let oil go to about $40/ba where it belongs

i am sick of all this bs .

As am I. And it can go to $10. a barrel.

I am sick of the deception of Competition. There has been a virtual monopoly since the 70s.. When OPEC declared war.

 

[Brian4Liberty]

screw the saudies , let oil go to about $40/ba where it belongs .

Ironically, it's the Saudis that are lowering prices, and the crony Whitehouse wants to raise prices.

 

[Brian4Liberty]

I am sick of the deception of Competition. There has been a virtual monopoly since the 70s.. When OPEC declared war.

And now the Whitehouse is like a member of OPEC that wants to set prices higher.

 

[pcosmar]

And now the Whitehouse is like a member of OPEC that wants to set prices higher.

I suspect duplicity.

 

[FindLiberty]

Some oil duplicity = some greased palms

 

[Zippyjuan]

screw the saudies , let oil go to about $40/ba where it belongs . then the bad guys in the arab world will go back to herding goats as their money dries up .

the oil companies have made trillions of $$$$$$$$$$$$ fron oil that was way over priced , now the goverment wants to keep pumping money to big oil .

there is really no difference between the d's and r's .

i am sick of all this bs .

$40 a barrel (and staying there) would shut down most fracking which is how the US has reduced their oil imports. They can't produce profitably at that price.

 

[specsaregood]

the oil companies have made trillions of $$$$$$$$$$$$ fron oil that was way over priced , now the goverment wants to keep pumping money to big oil .

I guess it depends on how you look at it. we've been buying oil for years with funny money; and the value of our funny money has been propped up by countries such as the Saudis requiring others to have our funny money on hand in order to buy their oil. in the scheme of things; that hardly sounds like its been over priced.

 

[HOLLYWOOD]

You Betcha... The House of SAUD is in bed with the organized crime syndicates within Washington DC beltway. Special Interest want to attack Russia, Iran, and Venezuela, et al. McCain was the dumbshit to parrot his Zionist master's conversation of "the only industry Russia has is Oil. We need to collapse the Russian economy by targeting their energy sectors." Orchestrated script to attack the real targets, the rest is propaganda to look elsewhere.

Frankly, I'm waiting for the circus stunts of 2007-08 in shutting down refineries, maintenance, etc, to jack the prices once again in NA, while still playing economic war overseas. If any governments should be complaining of falling oil prices, it should be those that have a 'State Sales Tax' on a gallon of gas, they're the ones losing the cash cow stream of inflation to increase revenues.

How those human rights working out in Saudi Arabia today, Department of State-Washington DC? Saudia beheadings are over 60 this year Obama... care to comment on the House of Saud brutal totalitarian family dictatorship? For the record, how's the CIA-MOSSAD-Mi6 orchestrated Arab Spring going in; Saudi Arabia, Qatar, U.A.E., Yemen? Yeap, it's all a game to the global thugs & dictators, the public doesn't have a clue whats going on.

I suspect duplicity.

 

[ILUVRP]

I guess it depends on how you look at it. we've been buying oil for years with funny money; and the value of our funny money has been propped up by countries such as the Saudis requiring others to have our funny money on hand in order to buy their oil. in the scheme of things; that hardly sounds like its been over priced.

i have always been for the middle/lower class , i see cheaper crude meaning lower diesel cost for truckers and farmers , also avg people will have more disposal money to buy better cars/clothes/food , they may even be able to buy some gold/silver coins as they will get cheaper with oil at $40/ba , big oil here and overseas have had their day .

https://www.google.com/url?sa=t&rct...NnclqzgQgXiQEggcg&sig2=uWT-K0cXccVHAF7xueLRXA

 

[Brian4Liberty]

Frankly, I'm waiting for the circus stunts of 2007-08 in shutting down refineries, maintenance, etc, to jack the prices once again in NA, while still playing economic war overseas.

Yeah, refineries have always been the most convenient choke-point. Oil can go down, but if gasoline goes down too much, refineries will have all kinds of "problems".

 

[torchbearer]

$40 a barrel (and staying there) would shut down most fracking which is how the US has reduced their oil imports. They can't produce profitably at that price.

Last domestic layoff happened when it hit $20/barrel. find the cost of domestic production, and you know the floor.

 

[pcosmar]

I guess it depends on how you look at it. we've been buying oil for years with funny money; and the value of our funny money has been propped up by countries such as the Saudis requiring others to have our funny money on hand in order to buy their oil. in the scheme of things; that hardly sounds like its been over priced.

Funny Money? You mean like the petrodollar.

That was never a good idea.

 

[thoughtomator]

Surprised nobody mentioned that if oil drops below a certain point, all the new oil industry (largely fracking-driven) in the US will become uneconomical, and that's all that's really prevented our economy from hitting bottom.

 

[ILUVRP]

Surprised nobody mentioned that if oil drops below a certain point, all the new oil industry (largely fracking-driven) in the US will become uneconomical, and that's all that's really prevented our economy from hitting bottom.

so we should subsidize frackers and big oil by paying more money for oil than its worth , like i said before cheap oil would help everyone in america like lower ult costs , cheaper fuel for cars/truckers/farmers .

we have been paying more (for at least 30 yrs ) for oil products than they are worth , so the frackers and big oil will not make the amount of money they were .

where is the free market on this forum , now we want to keep subsidizing companies because if we don't they will not make enough money and have to slow down production , cheap oil is much better than over priced oil for america economy . also cheap oil will slow down the amount of money the bad guys get from the saudies and others .

if high crude oil price is the answer then lets get the price up to $200/ba ( gas-$9/gal , diesal $10/gal, ult rates double ) then the frackers and big oil could put on 10-20 thousand more people and the companies could make more money , but america would lose at least 1 million jobs , farmers/truckers would go broke . i guess gold/silver may go up about 50% .