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Economy Title: OPEC to U.S.: Please produce less oil for the ‘prosperity of the world economy’ OPEC, the oil cartel really cares about the world. That’s the message of a new monthly report issued Thursday. OPEC says what the world needs now is a bit less supply on the global oil market. In particular, they would really appreciate it if the United States would stop producing so much damn oil…for the good of the world of course. From CNN Money: OPEC said that one producer in particular is to blame: The U.S., where shale producers have continued to ramp up their drilling despite lower crude prices. The increased production has undermined OPEC’s efforts to keep prices between $50 and $60 per barrel. Last December, Jazz wrote about OPEC’s decision to cut production for six months in an attempt to drive oil price up. The plan worked. Soon after the announcement was made, prices rose above $50 a barrel. OPEC members made clear at the time that it wanted prices higher but not above $60 a barrel because the low-60s is where U.S. shale would become competitive again. If prices were to settle in that range, it would mean a whole bunch of new drilling in the U.S. But the OPEC effort didn’t work for long. Prices are back below $50 a barrel now and thanks to increased efficiency, U.S. producers can still make money at those prices. Now OPEC has to decide whether to extend the production cuts into the latter half of the year or simply give up on the effort. Nitesh Shah, a commodity strategist at ETF Securities, says OPEC’s strategy has been a bust. He writes, “repeating the same strategy for another six months will do little to shore up oil prices.” “OPEC nations have given up market share and have barely reaped any price gains,” he adds. OPEC could try even deeper production cuts but OPEC members won’t like that. So OPEC is left begging the U.S. to give them a break for the good of the world economy. We could do that, but here’s another thought: Let’s continue taking their market share and reducing their control over the world’s energy market. Tom Pugh of Capital Economics tells CNN, “I think [OPEC] are now acutely aware that they don’t have the kind of influence they used to have 10 years ago, and that shale is now the swing producer in the market.” Post Comment Private Reply Ignore Thread Top • Page Up • Full Thread • Page Down • Bottom/Latest OPEC to U.S.: Please produce less oil for the ‘prosperity of the world economy’ To hell with the world economy!
#2. To: Tooconservative (#0) OPEC to U.S.: Please produce less oil for the ‘prosperity of the world economy’ Well, I'm old enough to remember the 1973 OPEC oil embargo and the effect that had on the U.S. economy. So f**k you. Hopefully, one day, you'll be driven out of the oil business and have no money to finance terrorism.
#3. To: Tooconservative (#0) Eat sand, Moo-slums. Death to Allah the Pigraper and his death cult.
#4. To: misterwhite, Hank Rearden (#2) Well, I'm old enough to remember the 1973 OPEC oil embargo and the effect that had on the U.S. economy. So f**k you. Me too. I don't recall OPEC doing us any favors ever. Their oily tears are as sweet as Canadian oil sands. And more bad news upcoming on Sunday for these OPEC crybabies: HotAir: Dakota Access Pipeline will be filled Sunday, but protesters still hope to stop it OPEC can't put the genie of American oil back into the bottle.
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