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even if we drill here and now is that really gonna be that much oil or to say enough to control or substantially lower the price if they continue to cut production? |
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Written By:
NSolo
URL:
http://
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If oil prices fall below $50 a barrel, Iran’s subsidies for home-buying and for vast numbers of their unemployed come under risk of cutbacks, something which the clerics must avoid. $50 per barrel would seem to be the floor; not because of economics, but because of the political necessity if Iran doing watever it can (kidnapping British sailors, harassing naval warships in the Straights of Hormuz) to create enough fear in the markets that the price stays above $50. |
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Written By:
a Duoist
URL:
http://www.duoism.org
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I believe any illusion that supply manipulation is not used to affect the price of oil is gone, now. |
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Written By:
jpm100
URL:
http://
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OPEC might say they’ll cut production by 1.5 MBPD, but OPEC’s membership is notorious for attempting to cheat on production quotas. I’ll believe it when I actually see it. |
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Written By:
InebriatedArsonist
URL:
http://
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OPEC might say they’ll cut production by 1.5 MBPD, but OPEC’s membership is notorious for attempting to cheat on production quotas. You’re right, they do. And despite their rhetoric, Venezuela and Iran really can’t afford the loss of revenue right now.
But that may be why OPEC went with the 1.5 million instead of .5 million, expecting, with cheating, to really achieve the latter number. |
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Written By:
McQ
URL:
http://www.QandO.net
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$50 per barrel would seem to be the floor; not because of economics, but because of the political necessity There is more than political necessity at work here with the $50/barrel minimum. Sanctions imposed upon Iran for all these years have frozen Iran’s oil infrastructure in the 1970s. Whereas it costs approximately $6 a barrel to get oil out of the ground in Saudi Arabia, the cost in Iran is more like $32 a barrel. And from there you have to get it to the coast for shipment. The closer the price of oil gets to $50 a barrel, the closer Iran’s economy gets to going under. So much so that Iran has mandated that all automobiles in the country be converted to run on natural gas. First, because Iran cannot afford not to sell every drop of oil outside its borders and Second because this same infrastructure problem is even worse for natural gas. It is virtually impossible for Iran to economically ship its natural gas outside the country so using it is far more cost efficient. |
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Written By:
SShiell
URL:
http://
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I believe any illusion that supply manipulation is not used to affect the price of oil is gone, now. Uh, every one knew that since the 70s oil embargo.
Thing is, it isn’t such a great tactic, since cutting back on supply may raise the price, but not the profit.
What would be sweet would be to be an unfettered oil producer, while all the other producers cut production.
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Written By:
Don
URL:
http://
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