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From last June but still relevant:
Oil-Price.net
Oil-Price.net
Saudis lose US clout over oil price war
By STEVE AUSTIN for OIL-PRICE.NET, 2016/06/20
In an event that went largely unnoticed, we have, in fact, passed the point in human history where OPEC's key member Saudi Arabia can dictate oil prices any longer. No one seems to have taken in the momentous occasion if not comprehended its historical significance. Much hasn't been said or written, it has to be added.
Long time readers of oil-price.net will recall how as early as 2012 we had not only predicted the takeover of the entire region by ISIS, but also anticipated in 2013 that a surge in oil price volatility was on its way. In addition, we carried a comprehensive analysis, just weeks before the oil price collapsed.
Today we are at a similar turning point of a major milestone clustered with many defining clauses. Consequently, there are some drastic geopolitical implications for all nations from the producers of the Middle East to western democracies; from consumers in Asia to Europe. The world is about to change.
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Now, for the details.
The day OPEC lost grip on oil prices
Respectable leaders lead by example and by breaking the golden rule of 'supply control' and by demanding others to obey, 'leader' Saudi Arabia not only harmed other OPEC member countries, but also lost all its credibility. And, reputation is one that is difficult to salvage once lost. Saudi Arabia did what it did, but the effect was felt by all. Breaking the rules of OPEC caused extreme hardships for other OPEC members. For example, Venezuela and Nigeria's oil payments contribute more than 90 percent of their total revenue from exports. Now, after Saudi's ill timed move, both countries are not only crumbling under massive revenue loss because of low oil prices but are also on the brink of famine and civil war.
Ever since then, OPEC hasn't been able to act in a cohesive coordinated way. So much so, OPEC meetings nowadays beget mayhem as members don't respect quotas any longer and are just happy to 'get something' for their oil. OPEC's clout has crumbled. The cartel has lost the cohesion that once made it strong.
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