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re: Oil Wars: Why OPEC Will Win
Posted on 12/15/14 at 4:07 pm to JayDeerTay84
Posted on 12/15/14 at 4:07 pm to JayDeerTay84
quote:
Oh ok.
What was I wrong on?
That the Saudis could not survive prolonged oil prices below $80/bbl.
SA is basically saying they are not going to cut their production to support prices for others. It is a slipperly slope for them which leads to operating at a deficit in the near future.
If they cut production to inflate price then others (like the US) will simply grow output to meet that demand. In cutting production SA may temporarily inflate the price, but is ceding market share.
SA has massive cash reserves and are able to sustain prolonged lower prices. They are going to use that as a tool to take back market share and temper new production.
1
Posted on 12/15/14 at 4:10 pm to NOFOX
Sounds good on paper however you guys think Saudi will just do whatever they want while the world watches. Idly.
Quite funny.
Quite funny.
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