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‘At It Again’: OPEC Deal Postmortem
We know prices in the three digits were causing instability. I can tell you that as we approach that range of prices, we feel that instability would be back.
That's from Saudi Oil Minister Khalid Al-Falih speaking on Friday and it marks an amusing contrast with reports out earlier this year that suggested Riyadh was angling to push oil prices as high as $100/bbl.
The about-face (which manifested itself first in a series of comments on May 25 indicating that Saudi Arabia and Russia would move t
While President Dennison would like to be king of the US, what he seems to be achieving is to be the “King of the Rock and the Hard Place (RAHP).” If he is successful shutting down immigration, he will also shut down a key source of labor force growth needed to support economic growth. If he drives down oil prices, consumers will be happier and once again remember he gave them these very expensive tax cuts. Trouble is, lower oil prices will kill the revival of the US oil business, causing bankruptcies and major junk bond credit problems, besides hurting the Saudi economy. They too have RAHP problems. High prices enable Iran and US competition which hurts the Kingdom, on the one hand, while helping the Kingdom’s economy and the value of ARAMCO on the other. Tricky this economics stuff. Wharton apparently didn’t cover it well enough for the POTUS just when these guys need it the most. Look at the tariffs. Now there is a thorny nexus of RAHP issues. Raise tariffs on car imports and the European car companies move to the US. Problem is, they can’t find enough workers (see 1 above) and the normal export markets for those cars have put retaliatory tariffs on cars emanating from the US. There are so many RAHP scenarios for tariffs they are too numerous to mention here. H has covered that very well. Too bad the government in Washington suffers from a significant lack of serious adult supervision. These days it’s more like a rowdy pre-school on Friday afternoon than a source for the leadership of the free world, as it were.