Topic: Saudi Arabia and OPEC Reveal Surprise Oil Production Cut (Read 230 times)

Man, have you heard about the recent OPEC production cut announcement? It's totally whack, with some countries like Saudi Arabia reducing 1.15 million barrels per day until 2023. The Saudi Energy Ministry is like, "Nah, we're just being precautious," but it's gonna have a massive impact on the global oil market. I wonder how the White House is gonna handle this situation. The US is a big shot in the oil game, so any move by OPEC is gonna have an effect on the US economy. Is the White House even taking this seriously, or are they just letting the world situation spiral out of control?

Recession fears are what pushes OPEC to continue cutting production, although I do not expect Russia to comply with that cut.
Oil prices are below $100, which is what the OPEC countries and even oil producers in the United States want, and it does not seem that there is much opposition to this trend, even in Europe.
The current problem is in gas prices, which is outside the authority of OPEC, but oil prices are now very low compared to inflation and what is happening in the world in terms of apprehensions.

At least that's what we're starting to see. This is probably their response to US and its allies when they didn't listen to OPEC's suggestion not to impose sanctions on Russia because it could create a supply shock ("they don't listen, we shouldn't listen"). Add to that the recent move by China to broker a peace deal between Iran and Saudi Arabia.

Well, there's still a high demand for oil and they can control the supply. What do you think is their production volume per year when combined? It's more than half of US. With more sanctions imposed on Russian oil, OPEC are in a better position to dictate now.

That is true about Joe Biden, but Joe Biden also is not dependent on oil from Saudi Arabia and hence couldn't care less. What if he was the president of a country that is mostly relying on oil for its industry and also for households? If I see this correctly the USA is still heavily relying on fossil fuels, even for the production of electricity. I am sure they are all for renewables and are speeding up the process, but up until shortly ago the US still has been a net importer of oil, but is now very close to being fully independent in terms of the numbers according to the U.S. Energy Information Administration.

But it can't be denied that there are countries in the world that are still fully dependent on oil imports. For them any cut in the provision of oil is bad news, but I assume that the US still doesn't care because they would probably be able to increase production themselves and export it. Though I have no idea whether importing oil from the US is a lot more expensive than importing from the countries mentioned by OP.

In the end what this cut does is it accelerates the development and innovation in the renewable energy sector. The day will come where these oil rich countries won't benefit from their oil anymore, but that is exactly the reason why many of them have been investing their money all over the world in companies and infrastructure and they have done it while almost going unnoticed. I think many of them are all set even when they couldn't sell any oil in 10-15 years from now. It would be interesting to do some further research on how much the oil rich countries already own in the world.

Tesla hasn't even achieved significant adoption yet, and fossil fuels are used in all other forms of transportation - trains, planes, ships. What's worse, it's also used in electricity generation. It's utter madness that not only humanity is not building more nuclear reactors, but they are getting rid of the existing ones. The Chornobyl and Fukushima disasters are used as a FUD against nuclear and the image of nuclear energy became tarnished.

Yes, Exactly I was looking into the geopolitical changes a few days back and how now the power is changing its directions, China is continuously pushing countries with natural resources and labor forces to boycott the USD and trying to implement the Local currency trades and in my observation, this is positive news for crypto look deep into indirect relation with the crypto market. Russia ain't the US supporting Crypto, China supporting crypto even aiming to lead with the Hong Kong crypto hub project, India Wolrds the biggest market supporting crypto on some level, Sudi Arabia holds huge stakes in the crypto market UAE we all know their contribution in the crypto. So all over it, a new block is being created by China that is somehow related to the crypto market and this is why many believe this bull run will be going to be supported by the Asian Market.

I do not see that things have started to get out of America's control in any case, since we must work together to ensure a stable price after stopping production within the framework of OPEC. America will lose control if Saudi Arabia stops using the dollar, and Saudi Arabia's presence in OPEC was one of the most important guarantees for this. In fact, Saudi Arabia stopping production within OPEC affects the global economy, not just the United States.
For its part, Saudi Arabia does not have an interest in entering into a confrontation with the United States, especially since its foreign currency reserves are in dollars.

I think they are all teaming up to rug pull the US here. All part of the obvious and synchronized plan to get everyone off of USD.

This could be their way to preserve its value and their supply, Saudi is actively coordinating with other countries with regards to this and they are slowly leaving the Dollar behind so yeah, US is not in control anymore as many tries to avoid being involve on the current crisis in US. Though i don’t think this will be permanent since US will survive on their crisis and they will rise again, for sure many countries can’t ignore this.

Change is always constant, I am sure about that but the US government no longer in control of the world situation is something I don't know but there are a lot of things going on ever since the Russian President and the Chinese President had a close meeting while the Chinese President made a statement when they are outside that sticking together of them will bring a dramatic change.
I believe the Russian, Saudi, Chinese, South African, and Brazilian presidents are cooking something and we're going to know sooner or later.

The US shouldn't have messed with Saudi Arabia. Biden was soooo rude during his last visit to Saudi Arabia he even insulted the prince himself. Besides there are rumors the prince is a good friend of the president of Chechnya, the notorious Ramzan Kadyrov. As a result, it seems Saudi Arabia is switching sides and will be way more friendly towards Russia and China.

Not just soon, we are already gradually losing interest in crude and its end product. Thanks to this era of great technology, which is rapidly spreading in every sector of life, Tesla has already developed vehicles that we can drive around without needing any form of petroleum, which is a moving development. We also have solar systems as a backup power supply, which is also less time consuming, less stressful, and in some countries, less expensive. Currently, we also have generators that regenerate powers and store them for later use. 

Let them try to manipulate the oil market as high as they want; it will only affect us and a few other citizens who are not exposed to the latest technology, and in those areas where we can't actually do without the need for petroleum. 

Not every country has this opportunity. The US has been supplying a lot of weapons to Saudi Arabia and Saudi Arabia has had conflicts with Iran since 2015. American politicians used this conflict to achieve their goals. Now China and Russia are entering the game, and before they kept aloof from this country. Geopolitics is starting to change.
What kind of human abuse are you talking about? If you read the facts about Guantanamo Prison, it is not clear who is more cruel.

The US always had a rather tenuous grasp of the situation and were able to work with the previous ruler of Saudi Arabia much more closely. It's a different era now though, Saudi Arabia has been growing richer all this time and the new ruler MBS is looking out for himself only. He was probably very annoyed to be embarrassed after killing that journalist inside the embassy in Turkey, showing he is not beyond stooping to new lows in seeking to punish people who he thinks have wronged him - this put him directly at odds with democracy.We also saw that he is mending ties with Iran now, probably as a method to get more leverage in the region and is tilting towards China - who have a big appetite for energy resources and no moral qualms getting in the way due to their equal authoritarian stance.

The United States contented itself with declaring that OPEC's decision to cut oil production is not advisable at the present time!!!

I can clearly see how the intensity of the American statements has changed from the previous one. It seems that Saudi Crown Prince Mohammed bin Salman is not satisfied with the Americans and is trying to get rid of the American hegemony.
Are the US authorities no longer in control of the global situation?

So far, we cannot say that, but I think that the signs have begun to increase clearly, and there is a great common desire among many countries to get rid of the US control over the global situation. There are many countries, including Saudi Arabia, that are not satisfied with the policy of the United States of America.

Wasn't this a news already a few months ago? I was surprised to see that this is still a news today or the news that I've read before was just the plan of cutting the production and it has just came into reality this time?

I thought that we're already gonna see a shed of light that the prices were already cut down for the past months. But then, just like the usual thing to be expected, it won't be forever at the low and now is the time for them to increase the price through this cutting off.

Oh my, 2023. There's also the news that Saudi Arabia is planning to go with the BRICS. That might be another factor for us to see whether it'll be a positive or negative impact to the oil prices.

The U.S. never had control of OPEC. Trump was probably able to garner a bit more control than Biden had but Biden's fully embraced green climate activism and instead of negoatiting more oil production, he'll double down on unreliable renewable energy sources.

Per the bloomberg article:


The White House is giving themselves credit for reducing the price of gasoline from a peak that was created by themselves. Utterly shameless. The U.S. economy ought to be in recession if not already, and energy prices are going up. Bad combination.

I think you missed the point, he was being sarcastic.

Interestingly enough, I think the reaction of the White House would have been different if the current administration was a Republican one, for someone who does not like the Oil as dominant source of energy on the Planet, Biden indeed is quite interested and pays much attention to the news on oil production and the impact it can have over the American politics and economics.

He has already tried to keep the gas prices down, so can save his popularity among the citizens, he may be scared OPEC timing could play against the incoming presidential elections in the United States.

Thanks to Elon Musk for taking the bravery of developing cars that do not require fuel to function. However, this does not deter existing oil countries from being frightened about Elon's Tesla cars. The introduction of Tesla vehicles by Elon Musk does not imply that the world will immediately adopt them. Tesla cars are even more expensive than oil-powered vehicles in many, if not all, parts of the world.

I love the idea of having an alternative to fuel, but let's be honest: the use of gasoline in automobiles isn't going away anytime soon. The US dollar will continue to have an infinite supply, whereas oil will not, but the new regulations will undoubtedly affect the price of the dollar in the global economy market.

Every country is using the resources at its disposal to protect its national interest. Joe Biden administration is not pleased with the human abuse that is spearheaded by the Saudi government headed by Mohammed bin Salman Al Saud. The crown Prince is gradually tilting toward Russia and China to seek partnerships. The cut in oil prices is spearheaded by Russia and other oil-producing nations because they want the price of oil to go high so that they can make more money. I am sure that the members of BRICS such as China and India will still enjoy discounted crude. But this influence will not last for too long because crude oil will soon become obsolete.