<![CDATA[Hedgehogs.net: '' related content]]> http://www.hedgehogs.net/tag/chronology+of+world+oil+market+events?view=rss http://www.hedgehogs.net/pg/blog/Nisha/read/11402583/commodities-briefing-us-to-produce-more-oil-amp-gas-than-russiafor-decades Fri, 24 Oct 2014 02:38:38 +0100 http://www.hedgehogs.net/pg/blog/Nisha/read/11402583/commodities-briefing-us-to-produce-more-oil-amp-gas-than-russiafor-decades <![CDATA[Commodities Briefing :- U.S. To Produce More Oil &amp; Gas Than Russia...For Decades]]> Article Link]]> 11402583 http://www.hedgehogs.net/pg/blog/Nisha/read/11402453/commodities-briefing-libya-opec-governor-says-group-must-cut-daily-oil-output Thu, 23 Oct 2014 09:28:42 +0100 http://www.hedgehogs.net/pg/blog/Nisha/read/11402453/commodities-briefing-libya-opec-governor-says-group-must-cut-daily-oil-output <![CDATA[Commodities Briefing :- Libya OPEC Governor Says Group Must Cut Daily Oil Output]]> Article Link]]> 11402453 http://www.hedgehogs.net/pg/blog/Nisha/read/11402452/commodities-briefing-a-world-without-opec Thu, 23 Oct 2014 09:28:39 +0100 http://www.hedgehogs.net/pg/blog/Nisha/read/11402452/commodities-briefing-a-world-without-opec <![CDATA[Commodities Briefing :- A World Without OPEC?]]> Article Link]]> 11402452 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11401921/commodities-briefing-opec-can-respond-to-excess-oil-supply-algerian-official Wed, 22 Oct 2014 20:09:51 +0100 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11401921/commodities-briefing-opec-can-respond-to-excess-oil-supply-algerian-official <![CDATA[Commodities Briefing :- OPEC can respond to excess oil supply: Algerian official]]> Article Link]]> 11401921 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11401919/commodities-briefing-how-low-can-oil-go-strategists-warn-brent-could-tumble-further Wed, 22 Oct 2014 20:09:48 +0100 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11401919/commodities-briefing-how-low-can-oil-go-strategists-warn-brent-could-tumble-further <![CDATA[Commodities Briefing :- How low can oil go? Strategists warn Brent could tumble further]]> Article Link]]> 11401919 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11401731/hamilton-how-will-saudi-arabia-respond-to-lower-oil-prices Wed, 22 Oct 2014 18:39:49 +0100 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11401731/hamilton-how-will-saudi-arabia-respond-to-lower-oil-prices <![CDATA[Hamilton: "How will Saudi Arabia respond to lower oil prices?"]]> Some interesting thoughts from Professor Hamilton: How will Saudi Arabia respond to lower oil prices?
Oil prices (along with prices of many other commodities) have fallen dramatically since last summer. Some observers are waiting to see if Saudi Arabia responds with significant cutbacks in production. I say, don’t hold your breath.
...
Last week I discussed the three main factors in the recent fall in oil prices: (1) signs of a return of Libyan production to historical levels, (2) surging production from the U.S., and (3) growing indications of weakness in the world economy.

As far as Libya is concerned, the politics on the ground remain quite unsettled. It makes sense to wait and see if anticipated production gains are really going to hold before anybody makes major adjustments.

In terms of surging U.S. production, the key question is how low the price can get before significant numbers of U.S. producers decide to pull out. If world economic growth indeed slows, and if most of the frackers are willing to keep going strong even if the price falls to $80 a barrel, trying to maintain the price at $90 could be a losing bet for the Saudis. They’d be giving up their own revenue just in order to keep the money flowing into ever-growing operations in Texas and North Dakota.

And if some of the U.S. producers do move into the red at current prices, it’s in the Saudis’ longer-term interests to let that pain take its toll until some of the newcomers decide to pack up and go home. If U.S. production does decline, prices would quickly move back up. But if that happens after a shake-out, the next time there would be less enthusiasm for everybody to jump into the game if they always have to keep an eye on whether they might be undercut again. This may be less of an issue for the U.S. tight oil producers, who can move in or out much more easily than operations like deepwater or artic, where there are huge fixed costs, long lead times, and a much bigger unavoidable loss if you gamble on prices always staying high.

And as for worries of another global economic downturn, so far they are only that– worries. If and when we see a downturn materialize, then I would expect to see the Saudis cut back production.

But until then it’s primarily a question of responding to surging output of U.S. tight oil. My guess is that Saudi Arabia would lower prices rather than cut production as long as that’s the name of the game.
emphasis added

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http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11401673/hamilton-how-will-saudi-arabia-respond-to-lower-oil-prices Wed, 22 Oct 2014 18:18:55 +0100 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11401673/hamilton-how-will-saudi-arabia-respond-to-lower-oil-prices <![CDATA[Hamilton: "How will Saudi Arabia respond to lower oil prices?"]]> Some interesting thoughts from Professor Hamilton: How will Saudi Arabia respond to lower oil prices?
Oil prices (along with prices of many other commodities) have fallen dramatically since last summer. Some observers are waiting to see if Saudi Arabia responds with significant cutbacks in production. I say, don’t hold your breath.
...
Last week I discussed the three main factors in the recent fall in oil prices: (1) signs of a return of Libyan production to historical levels, (2) surging production from the U.S., and (3) growing indications of weakness in the world economy.

As far as Libya is concerned, the politics on the ground remain quite unsettled. It makes sense to wait and see if anticipated production gains are really going to hold before anybody makes major adjustments.

In terms of surging U.S. production, the key question is how low the price can get before significant numbers of U.S. producers decide to pull out. If world economic growth indeed slows, and if most of the frackers are willing to keep going strong even if the price falls to $80 a barrel, trying to maintain the price at $90 could be a losing bet for the Saudis. They’d be giving up their own revenue just in order to keep the money flowing into ever-growing operations in Texas and North Dakota.

And if some of the U.S. producers do move into the red at current prices, it’s in the Saudis’ longer-term interests to let that pain take its toll until some of the newcomers decide to pack up and go home. If U.S. production does decline, prices would quickly move back up. But if that happens after a shake-out, the next time there would be less enthusiasm for everybody to jump into the game if they always have to keep an eye on whether they might be undercut again. This may be less of an issue for the U.S. tight oil producers, who can move in or out much more easily than operations like deepwater or artic, where there are huge fixed costs, long lead times, and a much bigger unavoidable loss if you gamble on prices always staying high.

And as for worries of another global economic downturn, so far they are only that– worries. If and when we see a downturn materialize, then I would expect to see the Saudis cut back production.

But until then it’s primarily a question of responding to surging output of U.S. tight oil. My guess is that Saudi Arabia would lower prices rather than cut production as long as that’s the name of the game.
emphasis added

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11401673
http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11400818/saudis-policy-of-downplaying-oil-prices-will-backfire-on-them Wed, 22 Oct 2014 12:19:27 +0100 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11400818/saudis-policy-of-downplaying-oil-prices-will-backfire-on-them <![CDATA["Saudi's Policy Of Downplaying Oil Prices Will Backfire On Them"]]> Saudi Arabia wants to use lower oil prices to pressure Russia to change its stance on Syria, to antagonize Iran, and to force US shale gas out of the market, Pepe Escobar explains the possible blowback...

read more...

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http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11400266/commodities-briefing-opec-can-respond-to-excess-oil-supply-algerian-official Wed, 22 Oct 2014 07:49:09 +0100 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11400266/commodities-briefing-opec-can-respond-to-excess-oil-supply-algerian-official <![CDATA[Commodities Briefing :- OPEC can respond to excess oil supply: Algerian official]]> Article Link]]> 11400266 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11400264/commodities-briefing-how-low-can-oil-go-strategists-warn-brent-could-tumble-further Wed, 22 Oct 2014 07:49:07 +0100 http://www.hedgehogs.net/pg/newsfeeds/hhwebadmin/item/11400264/commodities-briefing-how-low-can-oil-go-strategists-warn-brent-could-tumble-further <![CDATA[Commodities Briefing :- How low can oil go? Strategists warn Brent could tumble further]]> Article Link]]> 11400264