Ayatollah Ali Khamenei, Iran’s supreme leader, sharply criticized Saudi Arabia the next day, saying the Sunni Muslim kingdom will be punished by God for the act.
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This led to Riyadh suspending diplomatic ties with Iran later that night.
Ali al-Naimi reached his 21st year as Saudi Arabia’s petroleum minister, but it could be his last. At current prices, Venezuela will have to use more than 90 percent of its crude-export revenue to make debt payments, Barclays economist Alejandro Arreaza said in the report.
“While the pace of stock-building eases in the second half of the year as supply from non-OPEC producers falls, unless something changes, the oil market could drown in oversupply”, said the Paris-based adviser to industrialized economies.
Saudi Arabia produced 10.2 million barrels per day in 2015, according to the estimates of the US JP Morgan bank.
“We need a production cut that allows, for now, a stabilization of prices”, Del Pino added.
Whether that will work – given that private-sector growth is tied closely to state spending – will define Saudi Arabia’s economic future, and may determine whether it will eventually revert to its past policy of trying to defend oil prices.
Less than two months after OPEC nations sparred over oil policy in Vienna, they resumed the debate at Davos. Outside the 13 OPEC nations, the United States is set to see the steepest production declines later this year as domestic shale drillers trim oil spending by 40 percent compared to 2014 levels.
The current battle between Iran and Saudi Arabia is not just a sectarian conflict between the Shi’ites and the Sunnis, but also a battle for supremacy in the Islamic world, which coincidentally also pumps out the greatest amount of oil.
Unfortunately for Russian Federation, signs are not encouraging. It would give the appearance that it was ready to mount a rally, but that rally would fade, and oil prices would drift lower. However, things have been different this time.
The International Monetary Fund (IMF) cut its growth forecast for Saudi Arabia as low Crude Oil prices continue to batter the Kingdom’s economy.
This could put even more pressure on oil prices, given that all three will increase production to cope.
When you have about 60 percent of the oil and gas production that come only from one field, “Ghawar” which is today close to its peak, it is easy to understand that Saudi Arabia will soon have some problems. With new investment in the USA shale oil industry having fallen sharply, there are unlikely to be enough new wells being drilled to compensate for the drop-off of existing reservoirs. In fact, some are turning back to the old gas-guzzlers certain to eventually fuel a rally in oil prices.
Jeffrey Currie, global head of commodities research in Goldman Sachs’ Global Investment Research Division, predicted oil at $20 a barrel at an oil market-related conference in London last autumn.
Aramco’s Mr Al-Falih brushed aside the threat from renewable energy and the COP21 deal to cut carbon emissions. Curie’s prediction clearly shows a dramatic shift in market expectations, since Goldman made a call for oil at $200 prior to the global financial crisis. But considering that a barrel of oil was selling for around $98 when the channel was launched, and is now selling for under $30, it is reasonable to assume that Qatar could not simply throw money at its effort to gain a foothold in the established USA media market.
“[Islamic State militants] transport oil and provide security as well for certain middle men”.
Two small bullish factors; MACD’s putting in a series of higher lows, and so they are diverging from the price of oil and RSI is holding steady; it has not dipped to new lows yet.
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It is not the price collapse that worries the IEA: it is the prospect of a global shock when the Saudis have flushed out rivals and the market springs back violently.
