Monday, January 12, 2015

Oil Tip from a Saudi Arabian?

For reference, Brent Crude peaked intraday on 13 June 2015 at $107.82. Current spot price is $47.65.

Saw this on ZH which was from USA Today,

"There's less demand, and there's oversupply. And both are recipes for a crash in oil. And that's what happened. It's a no-brainer.  
Although Saudi Arabia and OPEC countries did not engineer the reduction in the price of oil, there's a positive side effect, whereby at a certain price, we will see how many shale oil production companies run out of business.  
I'll tell you Saudi Arabia and Russia are in bed together here. And both are being hurt simultaneously. And there's no political conspiracy whatsoever against Russia. Because we are shooting ourselves in the foot if we do that. " 
Sure, I've already said that this "Russia manipulation" thing is nonsense a while ago.

I've also said that this cannot possibly be ONLY a supply issue. Yes, oversupply, but not such a crazy amount of oversupply to cause a 50% drop in prices. The whole "lower oil is good for the US consumer, ergo good for the US economy" is nonsense in my opinion. The media can put a positive spin on anything. Lower energy demand is lower output, that's it fellas. Sans a massive leap in technology that drives the cost of energy down or increase yield or efficiency, that's the status quo.

But hey, don't mind my simpleton logic, I'm not a credible source. So, who is this guy that USA Today was talking to? Saudi Prince Al-Waleed bin Talal. Who is he, some spoilt-brat rich kid?


What about a billionaire businessman and investor who happens to be dubbed the "Arabian Warren Buffet" and is actually part of the Royal Family that controls the oil in Saudi Arabia? But I mean, what does he know that we don't know from the TV and newspapers, right?

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