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Are you claiming that US-based shale oil producing companies produced a lot of shale oil at the direction of the US government, as a tactic to hurt Russia and o

Are you claiming that US-based shale oil producing companies produced a lot of shale oil at the direction of the US government, as a tactic to hurt Russia and other oil-producing countries? Occam's Razor suggests those companies operating out of economic self-interest rather than a secret plot to politically destabilize other countries is more likely explanation of what has happened. And, in fact, oil's lowest prices were met because OPEC, with Saudi Arabia leading I think, continued massive production even as global supply increased, to drive the price down to the point that shale oil is no longer profitable and put shale oil companies out of business.

justicezyx 8y ago
It's quite sensible to assume that the rich and powerful are aligned and connected with the governing body of a nation.
ChuckMcM 8y ago
No, I wouldn't put it in those terms (government directing oil production of shale oil). I was trying to use oil as an example of a commodity that is often used as a foreign policy tool (see https://www.cfr.org/timeline/oil-dependence-and-us-foreign-policy https://www.cfr.org/timeline/oil-dependence-and-us-foreign-p... for some flavor of that) There was a pretty decent article on oil as foreign policy in either the Economist or Foreign Policy Review which showed regulatory response to oil production when viewed as policy. The bottom line was that the Government can make it "easier" or "harder" to get to oil reserves through regulation or easing regulation. And those changes, combined with the short term ability to fill or dump the strategic oil reserves influences the market in ways that are useful.
ars 8y ago
> at the direction of the US government Yes. See: http://money.cnn.com/2016/01/29/investing/us-oil-exports-begin/index.html http://money.cnn.com/2016/01/29/investing/us-oil-exports-beg... Look at the date of the article. And it worked. You don't have to compel companies to do things, you can arrange the world such that they want to on their own.
- extra88 8y ago
  What? By 2016, US companies had extracted so damn much oil from shale that they could finally convince the government that letting them export some wouldn't jeopardize the US's energy security. And this is two years after global oil prices plummeted, in 2014, causing trouble for Russia but really causing trouble for Venezuela. > you can arrange the world such that they want to on their own The US government didn't arrange for the oil to be in the shale. I don't know if it funded research into cheaper extraction from shale or if the companies figured that out on their own but even if they did, there are much better reasons to do so than hoping to screw with Russia at some point in the future.

justicezyx 8y ago

It's quite sensible to assume that the rich and powerful are aligned and connected with the governing body of a nation.

ChuckMcM 8y ago

No, I wouldn't put it in those terms (government directing oil production of shale oil). I was trying to use oil as an example of a commodity that is often used as a foreign policy tool (see https://www.cfr.org/timeline/oil-dependence-and-us-foreign-policy https://www.cfr.org/timeline/oil-dependence-and-us-foreign-p... for some flavor of that) There was a pretty decent article on oil as foreign policy in either the Economist or Foreign Policy Review which showed regulatory response to oil production when viewed as policy. The bottom line was that the Government can make it "easier" or "harder" to get to oil reserves through regulation or easing regulation. And those changes, combined with the short term ability to fill or dump the strategic oil reserves influences the market in ways that are useful.

ars 8y ago

> at the direction of the US government Yes. See: http://money.cnn.com/2016/01/29/investing/us-oil-exports-begin/index.html http://money.cnn.com/2016/01/29/investing/us-oil-exports-beg... Look at the date of the article. And it worked. You don't have to compel companies to do things, you can arrange the world such that they want to on their own.

extra88 8y ago
What? By 2016, US companies had extracted so damn much oil from shale that they could finally convince the government that letting them export some wouldn't jeopardize the US's energy security. And this is two years after global oil prices plummeted, in 2014, causing trouble for Russia but really causing trouble for Venezuela. > you can arrange the world such that they want to on their own The US government didn't arrange for the oil to be in the shale. I don't know if it funded research into cheaper extraction from shale or if the companies figured that out on their own but even if they did, there are much better reasons to do so than hoping to screw with Russia at some point in the future.