{"id":11616,"date":"2015-08-30T06:22:08","date_gmt":"2015-08-30T11:22:08","guid":{"rendered":"http:\/\/olduvai.ca\/?p=11616"},"modified":"2015-08-30T06:22:08","modified_gmt":"2015-08-30T11:22:08","slug":"opec-divorce-and-self-destruction-thanks-to-saudi-oil-strategy","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=11616","title":{"rendered":"OPEC Divorce And Self-Destruction Thanks To Saudi Oil Strategy?"},"content":{"rendered":"<h3><a href=\"http:\/\/oilprice.com\/Energy\/Energy-General\/OPEC-Divorce-And-Self-Destruction-Thanks-To-Saudi-Oil-Strategy.html\" target=\"_blank\">OPEC Divorce And Self-Destruction Thanks To Saudi Oil Strategy?<\/a><\/h3>\n<p><em>\u201cIf you are the world\u2019s leading energy economy, you produce energy, that\u2019s what you do.\u201d<\/em><\/p>\n<p><em>\u201cA government can stay irrational longer than it can stay solvent.\u201d<\/em><\/p>\n<p><em>\u201cEven in the short term, you\u2019re dead, if you commit suicide.\u201d<\/em><\/p>\n<p>The first quote modifies a\u00a0<a href=\"https:\/\/www.youtube.com\/watch?v=3v1wFKKWMCA\">GEICO commercial<\/a>\u00a0describing a free-range chicken (If you\u2019re a free range chicken, you roam free, that\u2019s what you do), the second, the famous John Maynard Keynes quote about markets (<em>The market can stay irrational longer than you can stay solvent<\/em>), the third, another famous Keynes quote (<em>In the long run, we\u2019re all dead<\/em>).<\/p>\n<p>Together, the three quotes provide a framework for analyzing Saudi options heading into the December 4 OPEC meeting in Vienna and its choices vis-\u00e0-vis the OPEC outsiders (all members but Saudi Arabia and its Gulf Arab allies, Kuwait, UAE, Qatar)\u2014<a href=\"http:\/\/oilprice.com\/Energy\/Crude-Oil\/Saudis-Could-Face-An-Open-Revolt-At-Next-OPEC-Meeting.html.\">reconciliation, separation, or divorce<\/a>.<\/p>\n<p><strong>If You\u2019re a Free Range Oil Producer\u2026<\/strong><\/p>\n<p>Despite low oil prices, Saudi Arabia is maintaining its investment in its oil industry. Saudi Aramco Chairman Khalid Al-Falih indicated in March that Saudi Aramco<a href=\"http:\/\/www.bloomberg.com\/news\/articles\/2015-05-06\/there-s-one-part-of-the-world-where-the-oil-industry-is-booming\">would not cut investment<\/a>. James Crandell, a Cowen &amp; Co. oil analyst cited in this article, who has tracked oil companies\u2019 budgets for many years, estimates that Aramco and its Kuwaiti and UAE counterparts will increase their investment in oil exploration and production in 2015 by 4.5 percent to $38.1 billion. (If proportional to output, the Saudi share would be $24.5 billion).<\/p>\n<p>On it\u2019s website, the Saudi Arabian General Investment Authority (SAGIA) identifies Saudi Arabia as the\u00a0<em>world\u2019s premier energy economy<\/em>, describes the outlook for the Saudi energy sector as never having\u00a0<em>been brighter or more secure<\/em>and\u00a0<em>poised for unprecedented growth, diversification, and profitability, and asserts that the high oil revenue environment has spurred a boom in both oil and non-oil development projects.<\/em><\/p>\n<p>&nbsp;<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>OPEC Divorce And Self-Destruction Thanks To Saudi Oil Strategy? \u201cIf you are the world\u2019s leading energy economy, you produce energy, that\u2019s what you do.\u201d \u201cA government can stay irrational longer than it can stay solvent.\u201d \u201cEven in the short term, you\u2019re dead, if you commit suicide.\u201d The first quote modifies a\u00a0GEICO commercial\u00a0describing a free-range chicken [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2,3],"tags":[458,3102,1775,600,701],"class_list":["post-11616","post","type-post","status-publish","format-standard","hentry","category-economics","category-energy-2","tag-john-maynard-keynes","tag-oil-market-share","tag-oil-price-collapse","tag-opec","tag-saudi-arabia"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/11616","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=11616"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/11616\/revisions"}],"predecessor-version":[{"id":11617,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/11616\/revisions\/11617"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=11616"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=11616"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=11616"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}