saudis were pumping nearly 8.3m bbls per day - and are to cut back 800k to 1m /day
so for sake of discussion a cut back of 1m @ $60/bbl - is a loss of $60m/day
but they are still pumping 7.3mbbl/day, which then only needs an increase in the oil price of $8.5/bbl to offset the prod cut
so ever since the last cut back a couple of years - and the oil price going from approx 30 to $80/bbl you can see how successful this is in making more money for oneself and in many ways this simple maths seems to make a mockery of the huff and puff by the individual OPEC members, non members and in fact any oil producer about prod cuts. the volume of cuts are quite small and reflect i suggest the quite tight balance of supply/demand going on even with all that USA ultra light crude which is not suitable for straight refining into todays refineries - crikey - think of the world today without the oil shale revolution, even though much of it has not been profitable - would have OPEC/the world been able to keep up to the world demand of now 100m bbls/day. And that is the interesting thing - all the headline news and historically looking back at GFC,s etc etc - the worlds demand graph is nearly as straight as an arrow moving upwards to now over 100mbbls/day but with only minor pertubations as a result of such ructions as the GFC etc etc. No doubt there are periods of slower demand but in the scheme of things it soon returns to the upward trajectory.
so the question i would wonder is the electrification of vehicles, ( which use dominantly coal fired power stations atm to recharge and hence impinging on current global warming policies and ramifications), gasification of vehicles going to beat the oil shale revolution - ie will there be enough electrification/gas of vehicles to replace the loss of oil shale production in the future to keep the oil prices at reasonable levels given all other things equal. Of course any systemic rise in oil prices will surely only accelerate change to electric vehicles - but of course this cannot be done instantly. My recent visit to Paris was interesting to see on the footpath charging stations for vehicles, it is coming - the motivation is clearly there.
interesting times but one would have to believe at least 2 or three oil crises in supply over the next decade or two before alternatives ( of any type) gain a foothold.
