Why the US is going to lose the oil price war

[AuburnAL]

Originally Posted by other99

The financial debacle that has befallen Russia as the price of Brent crude dropped 50 per cent in the last four months has overshadowed the one that potentially awaits the US shale industry in 2015. It's time to heed it, because Saudi Arabia and other major Middle Eastern oil producers are unlikely to blink and cut output, and the price is now approaching a level where US production will begin shutting downWhy the US is going to lose the oil price war

It is unlikely that oil prices will increase but the Saudis do have the resources to increase oil production while oil is becoming cheaper.

Sale oil production is very expensive and it is gradually becoming unprofitable. An alternative is to still concentrate on alternative energy supplies that are environmentally friendly.

I'll enjoy all my savings at the pump, watching Iran and Venezuela being hurt, and knowing that as soon as this costs the Saudis too much money, the U.S. oil industry will spring back.

[Tall Traveler]

All I can say is that yes, in the short run, the Saudis can kill our shale oil industry for a period of time. Eventually though, the Saudis will be dealing with dwindling supplies and then the price will skyrocket (assuming no major breakthroughs in energy production) and the USA will be in the driver's seat.

[drishmael]

Originally Posted by Cheesesteak Cravings

"This isn't simple "free market" competition between private companies, it's an economic war between OPEC nations and US shale oil private companies. We will get gauged if they get their way."

If they "get their way," the vast majority of the U.S. economy that doesn't involve petroleum extraction will benefit. A win-win.