Saudis set to boost oil production capacity
Allahpundit
Enjoy it; it’s the only good thing that has come or will come from Iran building nukes, explanding its influence, and generally scaring the shinola out of Sunnis. On the great Wahhabist roulette wheel o’ arch-enemies, their number’s suddenly come up — much to the relief of American motorists.
Someday that mullah mushroom cloud’s going to spout over Manhattan, but I promise you this, my friends: by the time it does, gas will be at 35 cents a gallon.
Crude oil fell to a 19-month low as Saudi Arabia, OPEC’s biggest producer, said it will increase production capacity.
Saudi Arabia has 3 million daily barrels of spare capacity and will push ahead with projects to expand output, Oil Minister Ali al-Naimi said today. Prices plunged yesterday after al-Naimi said he saw no need for an emergency OPEC meeting to consider further cuts in output. Prices have plunged 17 percent this year on speculation OPEC members won’t comply with production cuts…
Have The Saudis Declared Economic War On Iran?
Ed Morrissey
Noticed a drop in prices at the gas pump of late? After approaching or even topping $3 a gallon for gasoline, the prices have steadily fallen in recent weeks; stations here in Minnesota had it at $1.89 per gallon over the weekend. The decline at the pump comes from an unexpected glut in the market, and some OPEC producers had hoped to force a round of production cuts to bolster crude prices. However, Saudi Arabia announced today that it had 3 million bbls/day of spare capacity, and it intends to start using it (via Hot Air):
Prices fell in early trading after Saudi Arabia's Oil Minister, Ali al-Naimi, said his country has 3 million daily barrels of spare capacity and will push ahead with projects to expand output. Oil futures plunged yesterday after al-Naimi said he saw no need for an emergency OPEC meeting to consider further cuts in output.
``The Saudis are saying that they don't want to be the swing producer,'' said Bill O'Grady, director of fundamental futures research at A.G. Edwards & Sons Inc. in St. Louis. ``The Saudis have made substantial cuts, unlike a lot of the other OPEC members. Oil in a $40 to $50 range suits the Saudis much better than oil at $70.'' ...
This will hurt those producers whose efficiency cannot match the Saudis, which primarily means Iran and Venezuela. It's doubtful that the Saudis care much about Hugo Chavez and his determination to nationalize the Venezuelan energy industry, but the Saudis care a great deal about Iran and its radical Shi'ite mullahcracy. The Iranians have a big economic problem at the moment, and their only hope is to keep oil prices high enough to cover their gaps. If oil prices continue to drop, it slices off most of the margin the Iranians can capture from oil sales, their only export of any significance. ...
