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I guess those factions that we blame for the rise in oil prices we can also thank for the decrease in those prices.
I havent seen prices this low for quite a while.
When prices rise it is corporate conspiracy. When they fall it is government conspiracy. Anything not to credit the marketplace.
Safeway here gives you 80 cents off regular price per gallon with SW card. Brings it down to $2.60.
But worry not. Entire thing is strictly political. Obama threatened Russia that USA will lower oil prices to drive Russia into submission. That's what's going on right now. Oil sheiks did same. Saudis lowered price per barrell - and did not reduce output accordingly, to keep prices at whatever level.
It's all politics, boys and girls.
Also, tells you how much rigged oil prices really are. Has none to do with costs etc. Strictly politics and big oily mace to punish at will. It'll jump back to 5 as soon as this mess is cleared.
Um... price cuts would normally accompany output increases, not cuts - you know, that whole supply-and-demand thing? Maybe you've heard of it?
First, the price has dropped because it was expected that the Saudis would cut production. Instead, the Saudi are lowering the price because of increased U.S. output due to exploiting shale reserves - the market is playing catch-up to that reality. Shale oil is costlier to extract than Saudi crude, so the Saudis are trying to undercut U.S. production (which this year surpassed Saudi production).
So what's causing the price drop is a combination of:
*The market belatedly realizing the Saudi's aren't going to reign in production, and
*Saudi wholesale price cuts, and
*The U.S. shale boom increasing supply
It's not some political conspiracy, it's simple supply-and-demand and market maneuvering.
Here in GA. I can't believe I am shocked that it has dropped below three dollars and I am excited about it. I remember when gas a 1.XX something. So crazy.
It's not some political conspiracy, it's simple supply-and-demand and market maneuvering.
If the price of oil dips too low it could dip beneath the profit line for shale production.
"... Some shale oil producers in North Dakota and Texas may find it unprofitable to keep drilling if prices dip below $80 per barrel (which, in turn, could slow the price decline)"
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