Saudis Mess Up Oil Strategy Big Time. Oil Prices Now At The Mercy Of Iran

In the previous post I have highlighted the fact that many large companies in Saudi Arabia have not been able to pay the salaries of their workers, especially their expat workers for up to TWO YEARS.  PLUS they are NOT allowing EXIT VISAS for these workers to return home to their countries. This is SHAYTAN behaviour. These people are kuffar.

But you do not see this news in our local TV, radio or newspapers like Utusan Meloya, Berita Hairan, TV3suku, RTMO1 and such. So the Malay people are kept in the dark about what really goes on in the 21st century world. Jadi lagi bodoh lah. 

They exist in a false, make believe world that everything in the Islamic countries is fine. Pi dah mabuk.

Folks, here is another story of Saudi stupidity. Pak Unta ini bodoh tahap nak mampos. This is a literally correct statement. The stupidity of the Saudis is now about to cause them their heads.     This is from Yahoo News  here . 

(Reuters) - 

Saudi to reduce oil production if rival Iran caps output 

Riyadh tries to curtail supply,  boost prices.

Riyadh ready to cut if Iran freeze production

Saudis ready for cut but Iran must agree to freeze 

offer   rejected by Tehran  

Oil prices 4% lower as hopes of agreement faded.

Previously, Saudis refused to discuss production cut

Riyadh orchestrated current OPEC policy in 2014 

refusing to cut output to support prices 

chose to defend market share against rivals 

fall in oil price to $30-$50 

Saudi strategy caused rift in OPEC 

poorer members faced budget crisis, unrest. 

tighten belts after decades of spending.

At US$46 per barrel, below budget needs of OPEC countries
Saudi output drops in winter, spikes during hot summer months

(cheating) attempt by Riyadh to present natural decline as cut.
Iran to boost output to 4 million bpd 

production in past three months at 3.6 million bpd

Riyadh's production record high in July 10.67 million bpd 

first attempt at production pact collapsed in April 

Riyadh insisted Tehran participate. 

Iran will not join any agreement 

My comments :  It is the Saudis who caused oil prices to crash when they refused to cut production two years ago. The morons do not seem to understand the oil business. Or any other business.

They insisted on maintaining high production levels "to maintain their market share".  This is ILLOGICAL even if you are calculating VOLUME ie million barrels of oil. Because shale oil has appeared and is also taking up market share.  Plus in 2015 the US became a net exporter of oil.  Even Israel is now an exporter of gas to Egypt. Oil and gas are shooting out of the sea almost everywhere around the world. So what arket share are they talking about.

It definitely makes NO SENSE if you are calculating your DOLLAR earnings or PRICE PER BARREL because prices dropped so low that your earnings are less EVEN if you export more VOLUME of oil.

I think the real reason the Saudis started pumping oil in large quantities was at the behest of the US.  To suppress oil prices to punish Russia and Iran - which depend on oil money to sustain their economies.

Saudi oil production got entangled with the Sunni - Shia bullshit and the US - Russia 'cold war'.   They thought that low oil prices could cripple Russia and Iran. Saudi oil production became a political tool. An instrument of policy.

Wrong on both counts.  Russia is still resilient and is becoming even more resilient.

Instead the plunge in oil prices have affected US shale oil producers more than Russia or Iran. Even then US shale oil can still reach the market.

The Saudis are "fighting" the Iranians through proxy wars in Yemen and Syria. They are losing in both countries. The Shias have already taken control of Iraq - a Shia majority country.  Shias are also becoming restive in Bahrain - another Shia majority country at the Saudi doorstep. It is unlikely that the Saudis will be able to defeat the Shias in Yemen or Syria. 

Saudi Arabria is now seriously short of cash. This country can go bust. Just like the Malaysian gomen can also go bust.

The Saudis are now proposing to Iran to cut oil production to boost oil prices. They want Iran to "freeze" their output at 3.6 million bpd. Iran has said no.   I think Iran has already shown the Saudis the middddle finger. 

Here is something someone told me. The Iranian cost of production is about US$13 per barrel of oil. The Saudi Arabian cost of production is about TWO TIMES or more. So even at US$46 a barrel, the Iranians make US$33 profit. Plus the Iranians are not embroiled in wastage and corruption like the Saudis.

Whatever the Saudis make PER BARREL is first divided with the American and British oil companies that help them dig the oil. Then the balance has to be shared among the corrupted princes in the House of Saud. Plus a few others. Only the left over reaches the ordinary Saudi.  

If the Middle East does cut production and oil prices shoot up, it simply means that shale oil from Canada, USA, Russia and even China will become more viable and profitable. Shale oil will start flowing in volume. This will depress oil prices again.

OIL IS A SUNSET INDUSTRY. 

Mothers and fathers, tell your kids to look at other industries for the future. Oil and gas is dying.

Saudi Arabia is dying too.   

Utusan Meloya, Berita Hairan, TV3suku, RTMO1 learn to tell the truth to the people.  Suka sangat ke tengok orang kita makin bodoh, bangang dan bengong? 

Tak tahu benda yang betul. Tak tahu berita yang benar. Tiap hari makin bodoh.  Lepas tu nak salahkan orang lain pula.