Free market or Freeloading off the work of others?

[UNC12345 + 171]

Perhaps it's been commented on in other discussions (I don't read them all), and educate me if I'm off base, but Trump's/USA's unwillingness to take part in the discussions about curbing oil production to me seems ironic.  He doesn't want to intervene so the free market can work itself out, even though the free market won't work itself out unless or until others intervene to save it?

What am I not seeing?  It just seems incredible that in such a key industry, the players are just left to destroy each other, and will only be saved by the work of other countries.  Isn't some supply management warranted, in these extraordinary times?

[BLA + 1,666]

2 hours ago, UNC12345 said:

Perhaps it's been commented on in other discussions (I don't read them all), and educate me if I'm off base, but Trump's/USA's unwillingness to take part in the discussions about curbing oil production to me seems ironic.  He doesn't want to intervene so the free market can work itself out, even though the free market won't work itself out unless or until others intervene to save it?

What am I not seeing?  It just seems incredible that in such a key industry, the players are just left to destroy each other, and will only be saved by the work of other countries.  Isn't some supply management warranted, in these extraordinary times?

Russia will cut 1 mm bbls if U.S..  BFD

Doesn't help when demand drops at least 20 mm bbls.

It's a race to sell as much as possible before storage capacity fills.   Nothing helps until Covid under control. 

Too much oil before Covid.  

Russia and Saudis have to learn to compete in Free Markets. 

U.S. consolidation will take place then we get stability

 

[UNC12345 + 171]

"Russia and Saudis have to learn to compete in Free Markets. "

Are you being serious with this statement?  I guess this just shows what I was referring to above.  You get the irony?

[Douglas Buckland + 6,308]

21 hours ago, UNC12345 said:

Perhaps it's been commented on in other discussions (I don't read them all), and educate me if I'm off base, but Trump's/USA's unwillingness to take part in the discussions about curbing oil production to me seems ironic.  He doesn't want to intervene so the free market can work itself out, even though the free market won't work itself out unless or until others intervene to save it?

What am I not seeing?  It just seems incredible that in such a key industry, the players are just left to destroy each other, and will only be saved by the work of other countries.  Isn't some supply management warranted, in these extraordinary times?

The free market only works when all players are playing by free market rules. National oil companies and cartels do not play by these rules.

[Ward Smith + 6,615]

23 hours ago, UNC12345 said:

Perhaps it's been commented on in other discussions (I don't read them all), and educate me if I'm off base, but Trump's/USA's unwillingness to take part in the discussions about curbing oil production to me seems ironic.  He doesn't want to intervene so the free market can work itself out, even though the free market won't work itself out unless or until others intervene to save it?

What am I not seeing?  It just seems incredible that in such a key industry, the players are just left to destroy each other, and will only be saved by the work of other countries.  Isn't some supply management warranted, in these extraordinary times?

Don't know what country you're from Mr. 12345, but there are actual laws in this country prohibiting collusion (monopolies and oligopolies). The USA isn't some monolithic producer, in fact at last count there were well over 6500 oil and gas production companies in the US. It isn't like telling Pemex to turn down the spigot. But in point of fact, the "free market" has spoken and multiple producers are "doing the right thing" and shutting in production if they can. My little production company is taking advantage of these market conditions to rework our wells and further implement technology we were considering before. 

Meanwhile OPEC is a defacto oligopoly, whose whole stated purpose was to control pricing via swing production. Their intent was to drive prices higher as all good monopolies do, but first they needed to take a page out of Standard Oil's playbook, and sweat the competition, until they are competition no more. There's a good reason this country doesn't allow monopolies and why Standard Oil is the poster child for them. 

[ralfy + 55]

Intervene so that a free market will work out. Say what?

 

[UNC12345 + 171]

I completely understand what you've written here and agree for the most part, but I guess what I'm referring to is the fact that we are in a once in a lifetime event here.  You don't think there would be severe negative consequences to just allowing all these producers to just go bankrupt, and allowing the supermajors to step in and consolidate the industry?  You don't think they are going to raise prices and control price after this happens?  I understand these things happen over time, but the severity and speed here is unprecedented.

I'm glad the industry as a whole has willingly cut production and I hope you understand that I was simply not proposing to changing the nature of a free market system entirely.  I'm talking about an intervention in highly unusual circumstances and in a key national industry.  It appears Trump doesn't need to get involved, if it's true production has been severely curtailed.  I hope we gain some stability soon.