Happy consumerism day! I’ll be celebrating it differently than most people… http://en.wikipedia.org/wiki/Buy_Nothing_Day
We will produce 30 million barrels a day for the next 6 months, and we will watch to see how the market behaves,” OPEC Secretary-General Abdalla El-Badri told reporters in Vienna after the meeting. “We are not sending any signals to anybody, we just try to have a fair price.
Yes, “fair price.” That’s definitely what this is all about. OPEC, the cartel designed to ensure that small, oil-producing countries maintain a monopoly on oil, has always been interested in doing what’s fair for the world oil market. If you believe that, I have a bridge to sell you. It’s located in the US so it’s structurally deficient and likely to collapse any day because Republicans are too busy giving rich people tax cuts to be bothered with spending money on infrastructure. Anywho… Brent January contracts are trading around $72.60 a barrel as I write this. That’s a $6/barrel crash from their price just before Thanksgiving.
OPEC’s policy will spur a crash in the U.S. shale industry, Leonid Fedun, a vice president and board member at OAO Lukoil, Russia’s second-largest oil producer, said in an interview in London before the group’s decision.
“In 2016, when OPEC completes this objective of cleaning up the American marginal market, the oil price will start growing again,” said Fedun. “The shale boom is on a par with the dot-com boom. The strong players will remain, the weak ones will vanish.”
Yes, I know. I said that three weeks ago and I’m not even the VP of Lukoil like Fedun is.
That’s it. OPEC has thrown down the gauntlet. Your low gas prices are here to stay and will likely go much lower. Now all the clueless people claiming low gas prices were due to the elections can go into hiding. The slightly more intelligent people who claimed OPEC didn’t have the necessary influence to drive down oil prices can now start backpedaling.