3 ms·
> ... OPEC members are planning to boost production In 2012 Saudi had a $2.3 trillion USD gross operating surplus in crude petroleum and natural gas. They can
by ryanmarsh 11y ago
> ... OPEC members are planning to boost production
In 2012 Saudi had a $2.3 trillion USD gross operating surplus in crude petroleum and natural gas. They can afford to play this game (market share) for really long time.
- adventured 11y agoNo they can't. They can play the game for about three more years, max. And that's at the risk of destabilizing their kingdom. They're currently issuing debt [1] for the first time in a decade or more, trying to slow the erosion [2] of their $670 billion of reserves. As of today they've lost 10% of their financial reserves in one year, and that's going to get a lot worse as the new lower average price of oil sets in across 2015 and 2016. At a $40 to $50 oil price average for 2016, they'll lose upwards of 20% of their reserves next year. A few years of that, and the anxiety will be great in the house of Saud. I'm not sure where you're getting $2.3 trillion for anything. Their entire GDP is $750 billion. [1] http://www.reuters.com/article/2015/07/10/saudi-bond-idUSL8N0ZQ03F20150710 http://www.reuters.com/article/2015/07/10/saudi-bond-idUSL8N... [2] http://www.bloomberg.com/news/articles/2015-06-28/saudi-foreign-reserves-drop-for-fourth-month-to-672-billion http://www.bloomberg.com/news/articles/2015-06-28/saudi-fore...