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I find it odd that the article does not mention the oil price war between Saudi Arabia and Russia. https://www.reuters.com/article/us-opec-oil-policies-idUSKBN
by ufo 7y ago
I find it odd that the article does not mention the oil price war between Saudi Arabia and Russia.
https://www.reuters.com/article/us-opec-oil-policies-idUSKBN20W21S https://www.reuters.com/article/us-opec-oil-policies-idUSKBN...
- diminish 7y agois the price war the reason, the consequence or the accelerator of the current market?
- mattmaroon 7y agoIt’s the consequence of the slowdown in demand.
- toomuchtodo 7y agoThe price war was unintentionally started just as demand began to be wholesale destroyed by the response to the COVID pandemic. Supply was reduced, but demand was reduced even more by a halting of the global economy. Saudia Arabia was trying to bring Russia in line with OPEC+ price targets, but Russia has enough state cash reserves and a much lower state budget break even point (~$40/barrel vs Saudi Arabia's ~$80/barrel), so here we are.
- wyxuan 7y agoSaudi Arabia has a much lower break even point: around 20 dollars. Hell even deepwater only costs 80 dollars to break even.
- toomuchtodo 7y agoFor production, not supporting their generous benefits to their citizens. They’re going to burn up their state reserves on the gravy train.
- deleted 7y ago[deleted]
- flyGuyOnTheSly 7y agoIMHO the coronavirus scare was the catalyst that sparked the price war.
- jesuschroist 7y agoThe 'oil price war' was 3 weeks ago. Things are changing fast these days.
- Synaesthesia 7y agoIt’s not like that’s suddenly over now. But on top of that, demand is even lower, because fewer people are flying and driving around.
- jesuschroist 7y agoYes, but the article describes the problem of physical storage running out. This affects the price much stronger than some political gamble.
- solinent 7y agoHere's a good breakdown of crude oil usage I found interesting: https://www.eia.gov/energyexplained/oil-and-petroleum-products/ https://www.eia.gov/energyexplained/oil-and-petroleum-produc...