We can thank Saudi Arabia for much of the 52 percent drop in oil prices since late June, according to Richard Fisher, president of the Dallas Federal Reserve.
"The Saudis have engineered" the move, he said in a speech this week, CNNMoney reports.
Saudi Arabia led OPEC to reject production cuts, and the nation has offered price reductions to its customers.
Presumably the Saudis are trying to drive high-cost suppliers, such as U.S. shale oil producers out of business.
"We are a huge supplier of energy. The Saudis took a while to realize what was going on," Fisher said, referring to the growth of U.S. output, which has hit its highest level in at least 31 years.
Low oil prices also cause pain for Iran, Saudi Arabia's hated neighbor, he noted.
Given Saudi Arabia's policy, Fisher doesn't expect oil prices to rebound back to $100 anytime soon.
More
DelMarVa's Premier Source for News, Opinion, Analysis, and Human Interest Contact Publisher Joe Albero at alberobutzo@wmconnect.com or 410-430-5349
4 comments:
Richard Fisher is a real brainiac. He's just now figuring out that Saudi Arabia controls the supply therefore the price of oil. Could have told him that back in the 70's. Amazing that these are the people in charge of our banking system and money supply. No wonder the world is going to heck.
Oilmen in this country are trying to make us self supporting on oil but liberal democrats keep trying to stop them,It's like they want foreign oil to continue to run us.
They pulled off 9/11, fixing gas prices is a walk in the park.
Earlier sessions gave some hope to the oil industry when the crude price got 1% boost and prices raised to above $62 ....but US stock data forced the prices to fall under $61 ... why dont they maintain constant value for the crude for the time being irrespective of the stock???
Post a Comment