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Oil price plunges as OPEC decides against cutting output despite world glut

Friday, November 28th 2014 - 06:23 UTC
Full article 18 comments

Brent and US crude oil plunged as much as 6.50 dollars a barrel on Thursday, the steepest one-day falls since 2011 following on OPEC's decision against cutting output despite a huge oversupply in world markets. Read full article


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  • CabezaDura2

    Venezuelan Foreign Minister Rafael Ramirez said he accepted the decision as a collective one and hoped that lower prices would help drive some of the higher-cost U.S. shale oil production out of the market.

    ”In the market, some producers are too expensive,” he said.

    Delusional wishful thinking, these guys have being defeated in OPEC by the Saudis and still look at excuses to throw a dart at the US shale revolution.

    Nov 28th, 2014 - 09:42 am - Link - Report abuse 0
  • ChrisR

    Meanwhile we in Uruguay are still paying the highest fuel prices in SA.

    The cost could fall to zero and the price would probably still go UP!

    This is what you get when you have an old murdering commie bastard in the presidency. At least this coming January we won't see a unilateral 10% rise in all fuels on his dictate, followed by “No Money Pepe” asking why inflation suddenly shot up.

    Nov 28th, 2014 - 10:03 am - Link - Report abuse 0
  • Captain Poppy

    How long until the bus driver is parked in a garage?

    Happy belated Thanksgiving to most all. It may not be your holiday but we can always find reason to be thankful.

    Nov 28th, 2014 - 06:15 pm - Link - Report abuse 0
  • Troy Tempest

    Meanwhile... Maduro is probably realising that his position is unsustainable...

    Nov 28th, 2014 - 06:18 pm - Link - Report abuse 0
  • pgerman

    The price of oil above crumbling .... and Argentina, and the Latam continent, so close physically but politically so far the Islands ... the hope of a better future fades ....

    Nov 28th, 2014 - 06:56 pm - Link - Report abuse 0
  • Captain Poppy

    As the Bimbo of Buenos Aires indicates that all is well in Oz:

    Oil is crashing through the floor and Petrobas and YPF is taking the markets broader index into a slide:

    Troy.......the 45 % monthly raise to the Army gives him a monthly lease on life....his

    Nov 28th, 2014 - 07:20 pm - Link - Report abuse 0
  • Troy Tempest

    Captain Poppy

    I suspect he has his bags packed for Havana.

    Um, perhaps not - being VP under The Chav was one thing.

    As the President, he's gonna be the Fall Guy, anybody could see that, a year ago!

    Piano wire... lamp post... etc.

    Nov 28th, 2014 - 09:54 pm - Link - Report abuse 0
  • ilsen

    Calm down everybody, Maduro (Mas-burro) has a plan in the face of the oil-price crash.
    So, the plan is to print money, borrow money, and lie.
    Hopefully the evil Ramirez is running out of rope...
    ”The meeting was lapidary for the Revolution’s pretension to continue in its failed model. If $100-per-barrel oil is gone for good, [Vnzla] will need to adapt. [Vnzla] cannot continue living on exploding budget deficits, massive state bureaucracy, enormous subsidies, and restricted imports to sort-of make ends meet. Good luck with that.

    This is the beginning of the end for the regime, ALBA, Petro-Caribe and all the other alliances won't care when Vnzla goes broke, the rats will be jumping into the arms of who-ever will take them. The 'Bolivarian Brotherhood' is a myth, a dream and a charade built on the false promises and utter fanatasies of Chavez.
    However, the Venzuelans are going to suffer a lot more before this is over.

    Nov 28th, 2014 - 11:35 pm - Link - Report abuse 0
  • Klingon

    Well Petro Caribe will come out shining. They struck the deal with Chavez when the oil was high and now when Mad burro is gone they can but cheap oil direct on the market.
    The Saudias have a stock pile of $$ So they will ride this out and let the high cost oil producers die off then try to force the market back up again.

    Simple supply and demand.

    Nov 29th, 2014 - 01:29 am - Link - Report abuse 0
  • ilsen

    Your are correct when you say the Saudis can afford to 'ride this out'. They are looking smug.
    However, the 'petro-caribe' countries have based their economic forecasts on a (false) cheap oil-supply from Vnzla. They are still 'tied-in' to deals with PDVSA, who can't supply, and they are not free to buy 'cheap' oil on the free-market.
    Here is a 10 point breakdown.
    1) they are 'tied-in' to complicated 25-year deals, much of which was advanced in loans, which they are indebted for.
    2) the new 'cheap' oil is still more expensive than their 'loan/oil-buying' deals
    3) for Chavez, it was always about ideological empire-building, not about the true cost of oil
    4) Chavez is dead
    5) his ideological legacy is consumed by internecine corruption
    6) the 'real' oil-price has fallen 30%
    7) the debt/loan arrangements remain
    8) Maduro is just a puppet of Ramirez
    9) Ramirez is the worst of the Boligarchs and will bail-out soon
    10) Venezueala will collapse and all the Petro-Caribe and ALBA countries will take the pain too.

    Just so you know....

    Nov 29th, 2014 - 02:31 am - Link - Report abuse 0
  • yankeeboy

    The Saudis don't have as much money as people think. I told everyone years ago US Shale gas would change how the world works. They're still predicting by 2020 the USA will be energy self sufficient.
    Bye bye OIl Dictators and Mid East Potentates.
    Good riddance
    I hope they go back to nomadic tribes chopping each others heads off over a watering hole.

    Watch Russia crumble quickly too

    Tee hee
    I can't wait.

    Nov 29th, 2014 - 03:00 am - Link - Report abuse 0
  • ilsen

    @11 yankeeboy
    I was just saying that the Saudis can afford to 'ride-out' this particular 'crisis' where-as the Venezuelans and Petro-Caribe/ALBA can not. They new oil price will cause a lot of pain. They have been gambling too long.
    I agree with your statements re: the USA, long-term...
    and I wish you all the best! I look forward to that re-alignment.

    But this article is about the current situation. I personally doubt Vnzla can survive it due to mismanagement, corruption and the enforced implacement of the miltary 'chosen-ones' in essential positions within PDVSA.
    Most actual Venezuelan engineers/scientists have gone to Colombia, or elsewhere. Vnzla no longer has the expertise to produce its reserves.
    This is the true socialist paradise, that they must now drink the oil as they can not provide clean water for the people.

    Nov 29th, 2014 - 03:26 am - Link - Report abuse 0
  • Klingon

    @12 You are correct
    Which ever way this falls Venezuela is going down the drain.

    Nov 29th, 2014 - 11:32 am - Link - Report abuse 0
  • yankeeboy

    12. I don't think this is temporary and there's only so much Opec can do. They can greatly reduce output to drive up price but that means less overall revenue too.
    When you only have 1 way to get U$ and the long term trend is down, possibly way down ( I hear $35/B)
    None of the major producers will be able to keep spending up for very long.
    Either way it works out it is great for the USA.

    I remember Toby and Stevie arguing with me about USA fracking.

    Nov 29th, 2014 - 05:17 pm - Link - Report abuse 0

    It is truly challenging to look through it all. The deceit is so thick that even well educated people are missing the bigger picture. The entire world is unraveling. Shopping has become the undisputed meaning of life. For the privilege to buy superfluous, unnecessary stuff that is manufactured with integrated, planned obsolescence - utilizing fossil fuels, most people seem to cave in to this unchecked consumerism.
    While the souls of the people run empty, substitute satisfaction comes from 'I am - therefore I shop'.

    However, dump sweet crude oil prices will make Keystone XL an insane proposition. Having just left Hawai'i another reason must be factored in: Gas prices have dropped by 25% in little over six month - scores of people are leaving the islands because of severe air pollution from the Lava flows.
    Gas prices in Uruguay are going up because people are addicted to their personal vehicles. In an unrigged market, gas prices must go down when demand ceases. If one needs assistance to understand the deeper interdependence in this, ask.

    Nov 30th, 2014 - 10:01 pm - Link - Report abuse 0
  • ChrisR

    @ 15

    You have overlooked the one point that REALLY matters with petrol prices in Uruguay: IT’S A RIGGED MARKET!

    The government OWN the market, the government SET the prices irrespective of market pressures.

    The stupid commie learnt that last January when he unilaterally RAISED fuel prices 10% across the board: even the crook Sendic didn’t know it was coming and then ”No Money Pepe” complained inflation had risen by MORE than 10% extra. What a surprise, NOT.

    It is useless you comparing the US petrol market with Uruguay.

    It sems YOU are the one that needs “to ask”. Sorry about that.

    Dec 01st, 2014 - 12:51 pm - Link - Report abuse 0

    @16 ChrisR

    Okay. Markets are generally rigged. Elections are rigged. Politicians always lie. Nothing new there.
    Here comes the asking, of course.
    Where does the Uruguayan gasoline/fuel come from? How much does the Uruguayan State pay for a barrel?
    One thing about your assessment of the president being a stupid Commie makes me wonder why Cuban gas prices are lower than in Uruguay? Those are obviously real communists.
    I am also confessing that 'Commie' is not a curse word to me. If that is what people want, so be it. It only sucks when it is hoisted on people, like in the former GDR.
    It surely helps to understand how all of this, especially the unmitigated exploitation/destruction of our home planet for a fistful bucks - the capitalists do it, the communists do it - I mean where is the difference? People are super serious, but a large number in the US is committing suicide - why? Because they can't make a living anymore. Uruguayans must focus on equal opportunities and a general sense of community. The WTC 'free' trade zone in Montevideo makes any notion about 'communism' in Uruguay highly questionable. There are doubts here that the exit at the aeropuerto in Havana de Cuba looks like a luxury shopping mall for the rich.
    There is no shame in asking. Not sorry about that. ;D

    Dec 01st, 2014 - 03:22 pm - Link - Report abuse 0
  • ChrisR

    “Okay. Markets are generally rigged. Elections are rigged. Politicians always lie.”

    I come from the UK and can tell you that markets are not rigged, especially fuel supplies. There are strict laws against it and anybody caught acting in concert with other companies are fined HUGE amounts of money which usually downsizes the businesses, sometimes fatally.

    Elections are not rigged in the UK either. I DO agree that all pollies lie.

    I wonder where the latest oil supply comes from. Mmmm, could it be Venezuela? Of course: cheap oil from the idiots of SA perchance. How much does Uruguay pay: TOO MUCH.

    Contracted in May ’13 to be supplied from June ’13 – June ’14 but was extended for an unspecified term in Feb ’14 WHY? Did Sendic not see what was going on in the world? NOT so cheap now, is it?

    I would hazard a guess that Sendic screwed up and FIXED the rate, which is one reason we are paying high prices TGW having to pay for 600,000 “government” employees (which includes ALL the other monopolies).

    “Uruguayans must focus on equal opportunities and a general sense of community.” WHY?

    Do you not realise that many employed people doing REAL jobs (not working for the government and therefore NOT paying taxes) are fed up with subsidising the ‘poor’ who are only poor because they NEVER worked at school and like their parents are NOT working now?

    Why do I hate commies? Because people like me who were poor as a child but worked hard and smart and ran their own businesses and improved the lot for their workers know one thing about handing money to the poor. Before long we are ALL poor.

    “ but a large number in the US is (SIC) committing suicide - why? Because they can't make a living anymore.”

    Do you REALLY believe that nonsense? You MUST be a genuine commie.

    Franly, given that the election has just been held and the Broad Fraud returned, albeit knocked about a bit, I no longer care about the lazy, uneducated and iliterate people who voted for them.

    Dec 01st, 2014 - 04:37 pm - Link - Report abuse 0

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