4 ms·
There's probably never a better chance to crush competitors, now that demand is low and high-cost private wells are fragile.
by balola 7y ago
There's probably never a better chance to crush competitors, now that demand is low and high-cost private wells are fragile.
- christophilus 7y agoThis is the answer. They think they can send US shale into bankruptcy before they go bankrupt themselves.
- look_lookatme 7y agoBut when the cost recovers we'll be back at it again. US shale has seen booms and busts for a hundred years.
- warlog 7y agoWhipsaw mkts will eventually make it impossible for credit to be extended to allow these low ROIs to operate. Welcome to post-peak oil pricing dynamics.
- fpoling 7y agoSaudi Arabia oil is the cheapest in the world. They have massive oil fields. So in principle they can bankrupt anybody unless somebody can come up with a cheaper way to get oil.
- davidf18 7y agoIt takes several years (I can't recall how many) and $100 billion per 1 million barrel increase in production and as far as I can recall the Saudis are pumping their maximum at his moment.
- aww_dang 7y agoHalf expecting some form of a bailout for shale producers if it comes to that.
- op03 7y agoDoesn't make sense. They could just buy US shale. I think the answer is Saudis are brainless. There is enough evidence.
- atlasunshrugged 7y agoI don't think that's really a useful comment, no doubt just like every country there are brainless people and smart people. For example, the ruling family has been very good at staying in power for years and years, MBS basically managed to trick the western media into thinking he was a progressive, and they've been able to be one of America's strongest allies despite funding extremist schools around the world, not things totally brainless people could pull off
- op03 7y agoWhat do you mean trick the western media? As if "tricking" the western media is such a complicated thing. Have you heard of WMDs, the subprime meltdown, election of Obama/Trump, Brexit? The Western media is a unrepairable fucked up system not worth bringing into focus here. Trump is on record saying the Saudi defense budget is whats keeping the US-Saudi relationship cozy. Its not complicated. But beyond that Saudi leadership is brain dead (from having no internal debate/competition/ allowing the propping up of MBS) and thats a most valid explanation for what will follow.