RE:Saudi death blow comingGashole1 wrote: They will not agree to any freeze or cut. They can outlast this for another 6 to 8 months... I believe they will drive oil down to low 30's again, and wait for production to fall off the cliff. then they will enjoy higher oil, but only after there are more companies go under and more production off the table.
I somewhat disagree. I think they are satisfied with the amount of carnage they caused US production. Production will continue to fall until oil prices are high enough to induce more spending that will allow companies to start new wells/fields to combat the decline rate. I think that price is around $60/barrel. Until then, US production will continue to fall rapidly. I agree that they can withstand low prices for longer but really don't want to continue blowing through their sovereign wealth fund like they have been. They are hurting big time and want to put an end to this madness. Otherwise, why even post any bullish comment whatsoever? If they were fine with the price in the low $30's, they would just spew bearish comments that would keep the price down and not hold meetings discussing production freezes. That would delay US rigs coming back online and cause an even faster decline in US production. I think they've had enough and want a freeze. But like I said in an earlier post, they aren't willing to freeze without he key players on board or else they give up market share they fought so hard to get back. All that pain they endured would be for nothing.