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OPEC’s Oil Price Fix – Is That All You’ve Got?

Friday, February 10, 2017 0:46
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(Before It's News)

So – OPEC finally came up with its production-cutting deal last November, and sure enough, up went the price of crude.  Members’ discipline has been OK (Iraq and Venezuela excepted) but, needless to say, it’s been heavy going for the Saudis, who have needed to hold back rather more than agreed to achieve even this …



Pretty feeble for a price-hike, huh?  And US oil stocks are high right now: and the hedge funds are holding record long positions in oil (nearly 900 million barrels) – whatever you think that means.  But $55 is quite enough to get the great shale-oil venture back on the road, and the US ‘rig count’ has been climbing since its low of May last year.  A bit of a cyclical upswing, to be followed by a cyclical production response …

In case anyone doesn’t know, as this new(ish) development in fracking technology really gets into its stride the Middle East is living on borrowed time because (a) the USA now knows it has all the oil it will probably ever need; and (b) should there be the slightest error in that calculation, it now transpires that the world’s largest reserves belong to … Venezuela.  As for gas, if Russia can ever get to grips with the fracking technology (shouldn’t be beyond them), they have so much more gas than everyone used to think, it’s quite off the scale.  Enough of all these hydrocarbons to make a Green weep.

Venezuela, eh?  The politics of the western hemisphere may get quite interesting down the road.  A good job for them President Trump doesn’t need to go looking abroad for US supplies.

What price that slice of Aramco then?  The ‘risks’ section of the prospectus should make interesting reading.  Remember, anyone caught lying in a prospectus for a Wall Street flotation goes straight to gaol, do not pass Go.  It’s taken very seriously there.

ND 



Source: http://www.cityunslicker.co.uk/2017/02/opecs-oil-price-fix-is-that-all-youve.html

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