Monday 12 January 2015

Stop looking for grand design in the oil price crash | The National

Stop looking for grand design in the oil price crash | The National:



"As the oil price has fallen past US$100 per barrel, then $80, now $50, one major newspaper has decided to stop talking of “psychologically important barriers”, which seem to be bypassed as easily as the Maginot Line.



Despite plenty of muttering about plots, in fact neither of the key players in this oil price crash actually did anything voluntarily to cause it. Unlike their actions in 1986 and 1998, the Saudis have not increased production sharply; rather they have trimmed it slightly but not made major cuts, active only in masterly inactivity.



And a cursory examination of the vagaries of US energy policy should dispel any idea of a coherent grand strategy. The thousands of individual shale oil producers are in cut-throat competition, not collusion."



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