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I had read several years ago about Putin's power and bravado being due to Russia's rise as an oil exporter when oil supply was tighter. I've seen this mentioned several times since then and always wondered if we would ever open the spigot to put him back in line.
Now that oil prices are settling- he surely has to know at what specific point/cost he has lost the Russian cash cow. And with no other industries really matching it that will be a hard fall.
So my question is- did US oil production mysteriously ramp up or do you think the US (and possibly the Saudis) made a conscience decision to show some power? Especially with Putin looking ready to pull a Hitleresque European expansion.
The Saudis are trying to put North Dakota out of business, pure and simple. They took the same action back in the late 80's when Alaska, Oklahoma and Texas were ramping up production. They were rather successful, a lot of wells got capped in TX and OK, those wells are now being reopened, BTW.
ANd if it hurts Russia at the same time, bonus. Once Saudi has depressed the price to the point that it become uneconomic to keep the US production going, they will jack the prices up again.
The Saudis are trying to put North Dakota out of business, pure and simple. They took the same action back in the late 80's when Alaska, Oklahoma and Texas were ramping up production. They were rather successful, a lot of wells got capped in TX and OK, those wells are now being reopened, BTW.
ANd if it hurts Russia at the same time, bonus. Once Saudi has depressed the price to the point that it become uneconomic to keep the US production going, they will jack the prices up again.
A lot of the increase is due to franking and not just the wells in SD. Plus there is also a stagnant demand that is factoring in as well.
I had read several years ago about Putin's power and bravado being due to Russia's rise as an oil exporter when oil supply was tighter. I've seen this mentioned several times since then and always wondered if we would ever open the spigot to put him back in line.
Now that oil prices are settling- he surely has to know at what specific point/cost he has lost the Russian cash cow. And with no other industries really matching it that will be a hard fall.
So my question is- did US oil production mysteriously ramp up or do you think the US (and possibly the Saudis) made a conscience decision to show some power? Especially with Putin looking ready to pull a Hitleresque European expansion.
Just wondering...
The US government doesn't control oil production, so no.
In regards to Putin, it's hard to say what his price point is, but I recall reading that he needs oil above $70/barrel.
FWIW, there are reports that gasoline consumption in San Diego county are still down 9% from pre-recession. If that carried over to the rest of the US, it would cause a world of hurt among producers.
Their natural gas exports will disappear, and even oil will take a serious hit if lockheed produces these at a decent price.
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