Good Morning Mermaids , Just looking forward to the OPEC meeting on Thursday in Vienna . It is thought that the Saudis will claim that there policy of flooding the oil market is working and will bully other members to stay the course . Well here is why it is not working and eventually will collapse in a pile of debt and misery . Firstly the Saudis claim that they can go on forever with this policy and that they don't care if the price is $30 or $70 . Well we know that to balance their budget they need $106 pb , and even with the massive amount of debt build and bond sales their reserves will dwindle another $100 bl this year ( more than half the worlds debt has been issued to the Arab oil States ) Other than Saudi Arabia , Kuwait , E.A E. , and OMAN , other OPEC Countries have very little reserves , or none , or are already in depression , or worse . Iran is desperate to see higher prices and have publicly stated they need $85 pb. Russia ' not an OPEC member ' about the same , Angola , Libya , Algeria , are all in dire straights . And as their debts build so do their costs . In fact all OPEC countries are haemorrhaging funds at an alarming rate . Sooner than later they will have to slow the pumps and rebalance the market . But the dilemma for them is , at $70 and above , non conventional oil will return ( $ 70.wont cut it for the Saudi's either ) Common sense wont win the day , but time will . Furthermore the Saudis have made more enemies , many more than they can cope with , The US congress bill to allow Americans to sue Saudi Arabia over compensation for 9 / 11 , will be very interesting indeed . We will watch and see how it all unfolds .........Cheers
MRM Price at posting:
42.5¢ Sentiment: Hold Disclosure: Held
