'Axis of love': Saudi-Russia detente heralds new oil order

[demmiblue]

Source: Reuters

A meeting between the two men who run Russia and Saudi Arabia's oil empires spoke volumes about the new relationship between the energy superpowers.

It was the first time that Rosneft boss Igor Sechin and Saudi Aramco chief Amin Nasser had held a formal, scheduled meeting - going beyond the numerous times they had simply encountered each other at oil events around the world.

Their conversation also broke new ground, according to two sources familiar with the talks in the Saudi city of Dhahran last week who said the CEOs discussed possible ways of cooperating in Asia, such as Indonesia and India, as well as in other markets.

The sources did not disclose further details, but any cooperation in Asia between Russia and Saudi Arabia - the world's two biggest oil exporters - would be unprecedented.

Read more: http://www.reuters.com/article/us-oil-opec-russia-saudi-idUSKBN18S3Y3?utm_source=twitter&utm_medium=Social

[lark]

1. And drumpf is cozying up to both parties.

Interesting!

[Egnever]

2. Happened right after he was just there

Here look I will sell you the guns you want but you gotta talk to my pal Vladimir about the oil situation...

[Sunlei]

3. why doesn't anyone buy from south america or africa? they would sell for $10 a barrel and its sweet

it's sweet crude, highest quality crude and very, very easy to drill/gather. Those countries need the money.

The world doesn't need PRICE SETTING corporations for dinosaur era juice.

[LongTomH]

5. No, but Putin, Trump and the Koch Bros do.......

[Sunlei]

6. USA has so much crude we export a LOT. We should NOT need to import any & use our domestic.

PUT THE AMERICAN PEOPLES BEST INTERESTS FIRST FOR ONCE REPUBLICANS!

[IronLionZion]

9. The US exports Alaskan oil to Asia because we get higher price for it

Asia needs oil and doesn't have much.

US gets a lot of domestic oil (North Dakota, Texas, Louisiana, etc.) as well as from our friendly neighbors to the north and south.



http://www.npr.org/2012/04/11/150444802/where-does-america-get-oil-you-may-be-surprised

Plus, let's not forget the US crashed the global oil market through fracking and shale drilling efforts in places like North Dakota. It's great for us, but it destroys Venezuela and other high cost oil producers which are often small developing countries with less to invest in technology.

[mr_lebowski]

11. Well, one could argue that OPEC crashed the market in response to our increase in production ...

They drove the price down by opening up their spigots and flooding the marketplace with their oil in order to maintain their market share. They can produce oil at a lower cost than the frackers can and thus calculated this move was in their best interest overall.

I think it was very short-sighted myself.

However they HAVE indeed caused a lot of fracking outfits to close up shop and our domestic production over the past few years has been falling as a result. That was a big goal of theirs when they decided to ramp up production even at a time of sluggish or even negative economic growth in the world at large.

Also, I believe worldwide demand has not grown as much as was expected, so that's played a role in keeping prices on the low side (well, vs. what we were getting used to, circa 2008).

[IronLionZion]

12. OPEC has less market share than they used to

It's not that they opened up the spigots, it's that they didn't decrease production to maintain high prices like they had in the past. Many OPEC countries depend too heavily on oil revenues for that.

So if anything, the decrease in oil prices over the last 3 years or so has showed that OPEC has less power than they used to. And that is by design.

The low oil prices benefit most everyone who uses oil. The world has shown it is willing to sacrifice Venezuela and Nigeria and apparently screw Russia and Brazil too.

Canada is diversified enough that they have other industries even though oil is screwed for now.

Worldwide demand has increased tremendously, especially in Asia. While it has leveled off or decreased in many western countries which have invested in fuel efficiency.

[mr_lebowski]

10. Um ... I'm afraid you're way off base here in terms of the US not needing to import crude ...

The US produces (i.e. pulls from the ground) a quantity that's only a bit over 1/2 of what we consume on a daily basis. We're not even close to being self-sufficient. And the low worldwide prices have shut down a significant portion of the newer production capacity by driving the 'fracking' companies out of business (costs too much to pull it from the ground for it to be competitive in the marketplace).

[IronLionZion]

7. Venezuela wants high prices and are a founding member of OPEC

Some of the African countries also need high prices to make it worth the cost of extracting it. They also have a higher sulfur content and it costs more to refine it and they get less gasoline from each barrel.

http://oilprice.com/Energy/Crude-Oil/A-Detailed-Guide-On-The-Many-Different-Types-Of-Crude-Oil.html

Buying oil from poor countries doesn't necessarily benefit the people that live there if there's a lot of corruption as we've seen in some African countries.

Somebody is buying oil from ISIS. That needs to stop.

[Sunlei]

8. perhaps Venezuela should get out of OPEC and they'd be richer than the Saudis by now :P

[LiberalLovinLug]

4. The new axis of evil?

Russia

Saudi Arabia

USA