Washington Eyes Crackdown On OPEC

[Osama + 248]

Here is a good "point to ponder":

"On Thursday, the House Judiciary Committee passed a bill that would allow the U.S. Justice Department to sue members of OPEC for manipulating the oil market. The so-called “NOPEC” bill would remove sovereign immunity, exposing member countries to antitrust regulation.

The bill has appeared in the past under prior administrations. But previous presidents from both political parties have opposed taking punitive action, fearing damage to the U.S.-Saudi relationship.

Times have changed. President Trump has repeatedly posted angry tweets about OPEC, blaming it for high gasoline prices. That led to a revived push for the NOPEC legislation. The murder of Saudi journalist Jamal Khashoggi may have also been a turning point, erasing a lot of goodwill for Saudi Arabia in Washington."

LINK: https://oilprice.com/Energy/Energy-General/Washington-Eyes-Crackdown-On-OPEC.html

 

THE QUESTION: Now that things are finally going smooth what is the point of the bill? Saudi's did what Trump said. Now, irked, they might go defiant? Or not?

@Tom Kirkman, @William Edwards, @Dan Warnick, @Jan van Eck, @Jan van der Meer, @Keven Tan(Where are you these days?), @ATK

[Justin Hicks + 162]

Could very easily irritate Saudi Arabia.

And suing for oil manipulation?? What would we collect, and how?

[Tom Kirkman + 8,860]

Trying to impose U.S. norms against OPEC is pretty much useless, and will likely cause more harm than good.

[NWMan + 89]

Really interesting that this is taken seriously.  It is again all about the dislike of OPEC.  Those Arabs have all the oil, they live in tents, they don't need oil, they should just give it to us for free.

OPEC are currently producing close to maximum at the request of the U.S president.  So is the current oil price due to manipulation by the U.S. president.  Maybe his assets should be frozen. 

OPEC claim they don't manipulate the price, they try and manage supply.  Does America really want an even more unstable oil market.  Do they really think that will bring cheaper oil.

And where does this confidence to tell OPEC what to do come from, energy independence based on oil shale -really!

[cbrasher1 + 272]

I think this just needs to not be voted on and the idea just go away...As @Tom Kirkman and @NWMan put it this could have a more negative impact on a lot of issues short list: middle east policies, oil markets etc. good point on the President, brings up a good case...

[Tom Kirkman + 8,860]

On the other hand, don't underestimate Trump.

This is hilarious, I am still laughing my butt off about the 5 story tall trolling statue, and costumed people dancing in the streets.  Watch the video, because MSM sure as heck won't show you this:

WATCH: Huge ‘God Emperor Trump’ Statue Rises Over Italian Carnival

 

 

Screencap:

 

/edit  here's a better video, it's in Italian, though.

God Emperor Trump | YouTube

 

[Tom Kirkman + 8,860]

8 hours ago, mthebold said:

 

What negative consequences do you two foresee? 

Expect less cooperation from OPEC - and Saudi Arabia in particular - if the U.S. proceeds with trying to apply Western norms against price fixing to the Middle East.

[Tom Kirkman + 8,860]

2 minutes ago, mthebold said:

What "cooperation" do we get from them, and do we still need it?  E.g. if they decide to play games, what's to prevent us from wrecking them now that we don't need their oil?  They're dependent on us for defense; we own them. 

The last time Trump tweeted demanding lower prices from OPEC, Saudi Arabia complied, then got burned.

I have long viewed Saudi Arabia as one of the worst absolute dictatorships in the world.

My ranking used to be North Korea the worst dictatorships, with Saudi Arabia and Iran and number 2 and number 3.

North Korea has improved.  Saudi Arabia and Iran, not so much.

I tend to think both of the current regimes of Saudi Arabia and Iran will be overturned domestically by their own hapless people, before Trump leaves office.

[Tom Kirkman + 8,860]

14 minutes ago, mthebold said:

I agree, but that doesn't address my point: SA can't survive without us.  They'll comply whether they like it or not, and they'll be grateful they're still alive. 

The alternative is that we could let a massive war erupt in the Middle East.  Russia and the US - the only two countries capable of interfering - would greatly benefit from increased oil prices.  Meanwhile, these dictatorships would be facing oblivion.  What's not to love? 

Heh heh, probably better if I don't comment any further.

Meanwhile:

[NWMan + 89]

11 hours ago, mthebold said:

The alternative is that we could let a massive war erupt in the Middle East.  Russia and the US - the only two countries capable of interfering - would greatly benefit from increased oil prices.  Meanwhile, these dictatorships would be facing oblivion.  What's not to love? 

How would the worlds biggest consumer of oil (America) benefit from high oil prices.  If that is the case why is Donald bitching at OPEC anyway.  He wants lower oil prices as he introduces oil sanctions against Russia, Iran and Venezuela. 

 

[Justin Hicks + 162]

4 hours ago, NWMan said:

How would the worlds biggest consumer of oil (America) benefit from high oil prices.  If that is the case why is Donald bitching at OPEC anyway.  He wants lower oil prices as he introduces oil sanctions against Russia, Iran and Venezuela. 

 

Never have understood that reasoning.

[Chase Mitchell + 2]

USA can control oil prices using our own oil rigs, increase the production if OPEC cuts their production, no one is stopping USA from doing that.   We should be more concerned about rising electricity and water cost other wise tap water would become more expensive than oil.

[Tom Kirkman + 8,860]

41 minutes ago, Chase Mitchell said:

USA can control oil prices using our own oil rigs, increase the production if OPEC cuts their production, no one is stopping USA from doing that.   We should be more concerned about rising electricity and water cost other wise tap water would become more expensive than oil.

The "safety relief valve" for the U.S. tight oil industry production, currently has a pressure set point of around $50 for WTI.

●  WTI below $50, production decreases, eventually (lag time of about 1 Quarter)

●  WTI above $50, production increases, eventually (lag time of less than 1 Quarter, closer to just a few weeks) 

[John Foote + 1,135]

On 2/11/2019 at 8:36 PM, Tom Kirkman said:

I tend to think both of the current regimes of Saudi Arabia and Iran will be overturned domestically by their own hapless people, before Trump leaves office.

The Arab Spring scared the bejeezus out of two sets of key people in Arab lands (Iran is not Arab for this discussion). First and foremost, the rulers. By in large what replaced the previous dictatorships was a more ruthless version. Leaders have become more brutal. Second folks in countries like Saudi Arabia who saw the Arab Spring from the sidelines, hoped for one outcome, saw another, and while they might not have it good in the KSA, they have it a hell of a lot better than the others. They are too scared, and still have it too good, to revolt, fearing a much worse outcome. 

Iran's leaders mucked up a country that in it's nature is civilized and educated. Those current rulers are nothing if not resilient. We've been projecting their demise since mid-1979 and we keep getting it wrong.

 

[Osama + 248]

On ‎2‎/‎11‎/‎2019 at 11:56 AM, Tom Kirkman said:

Trying to impose U.S. norms against OPEC is pretty much useless, and will likely cause more harm than good.

Indeed. Creating unnecessary noise!

[Osama + 248]

On ‎2‎/‎12‎/‎2019 at 7:25 AM, mthebold said:

What "cooperation" do we get from them, and do we still need it?  E.g. if they decide to play games, what's to prevent us from wrecking them now that we don't need their oil?  They're dependent on us for defense; we own them. 

It is not that black and white as well.

In the contemporary world, we all need everyone else. TO twist the meaning of Huxley's lines in Brave New World---we all belong to each other. This diplomatic promiscuity, if you may call it, is now part and parcel of international relations.

[Uduak + 22]

12 hours ago, mthebold said:

 

#2 is particularly interesting.  Trump doesn't necessarily want lower oil prices; he just benefits from railing about them.  The people think he wants prices bottomed out when, in fact, he wants prices to float in a happy middle: high enough to keep shale alive, but low enough to make OPEC suffer.  That's where we're at right now.  To accomplish this, Trump decided to turn OPEC into involuntary swing producers.  He need only look at current market conditions and, when sufficient production capacity exists, attack the next enemy.  If prices go too high, he could feasibly ease off one of his enemies.  He's in control of this process now, and he knows it.  The only actions that could wrestle control away from him would be major wars, and that would only give him more ammunition to expand domestic production. 

Heads he wins; tails they lose. 

Brilliant!! This is exactly what I think is going on.

[John Foote + 1,135]

11 hours ago, mthebold said:

The US can produce anything it needs domestically.  Even after decades of globalization and terrible domestic policy, only 10% of our GDP involves foreign trade. 

I thinks a bit north of 10% but the basic truth overwhelming our GDP is spend within the country. Of course 35% or so of this is just the size of government, state, federal, local, etc. And this is very industry sensitive. American oil companies, are very much international and oil services companies tremendously benefit from overseas business. Airplanes, industrial tools in high tech, software, military hardware. Those industry would be depressed almost overnight if we retreat to our own sandbox. Biggies like construction, agri-business, mostly would be fine with the US market. And of course the service sector, a huge part of our economy, is mostly internal. Consumer goods, the transition could happen back to US, though I'd like see what Walmart would stock. Same for autos, we could transition to internal only. In today's world of semiconductors imbedded everywhere, hohoho on thinking the USA can exist on an island. You can't produce the cheapest car in the country today, let alone one loaded with sensors. The qualification time for an automotive application is about 4 years. New semiconductor fabs are billions each, and each one a potential superfund site. 

It took years to build our dependence on the world. Changing things will take quite a while todo . And it's nice to think you can tell China to take a hike, but most of our trading partners play along, we'd have a leaky business wall. Nixon did us no favors if you don't like China. 

And yes, we are overdue proper controls with China. But naive to think we can quickly exist on our own without catastrophic results.

[Osama + 248]

19 hours ago, mthebold said:

The US can produce anything it needs domestically.  Even after decades of globalization and terrible domestic policy, only 10% of our GDP involves foreign trade.  The rest of the world needs the US to maintain their interdependent economies, but the US has no need for the rest of the world. 

The standard line of "we're all in this together" is a lie the world tells US citizens because, quite frankly, the world profits from our benevolence.  When we finally tire of wasting our blood and treasure maintaining the globalist system, everyone else will be in trouble. 

Unfortunately for the world, about half the US population has already decided where y'all can shove that lie.  Personally, I'll get a good chuckle out of watching the ingrates of the world suffer. 

Well, once again I am surprised at the narrowmindedness of this argument.

It is not about the ability to produce things domestically but to produce it at an effective and efficient rate/way.

 

From U.S.' benevolence you say? Well....I would leave it here. Just a reminder the benevolence was not only confined to positive/useful things.

 

In any case---I think we have digressed. But I stand by what I said.

Edited February 14, 2019 by Osama
spelling

[NWMan + 89]

19 hours ago, mthebold said:

The US can produce anything it needs domestically

Any country can produce anything it needs.  So Europe could go around shouting "Europe first" and ban any European company from buying or renting an American plane, or allowing American oil companies to obtain oil licences etc..  The idea that America has been tricked by the rest of the world into looking after them is strange.  Americas position in the world is what America wanted it to be and if it wants to change and be more insular then that is up to America. 

Obviously someone else will fill the void.  This process is already happening in the Middle East with Russia's presence in Syria and the co-operation between OPEC and Russia.

Russia and China obviously are trying to influence Venezuela.  They are investing at a loss in this country but they are not claiming that they have been tricked into it.  They want to do it.

And this is the point, you have countries like Saudi Arabia, China, Russia who have long term goals and strategic desires and then you have Trump who lies to his allies to get past the mid term elections.

 

[Tom Kirkman + 8,860]

14 hours ago, NWMan said:

Any country can produce anything it needs. 

 

3 hours ago, mthebold said:

No, they can't.  Europe can't produce it's own oil, the Middle East can't produce much of anything aside from oil, I'd love to see Central/South America attempt advanced aerospace & semiconductor products, and Africa - for all its natural resources - is hopeless.

^

[NWMan + 89]

The model put forward is one of isolationism.  Europe does have North Sea oil but it is to expensive to produce profitably when you can buy oil on the open market.  Europe unlike America is not producing oil at a loss.  If Europe was isolated it would produce oil at a loss because it had to - There is Norwegian Gas and Europe would have to build Nuclear power stations.  So it could produce energy.

South America are a major source of planes and in a world of isolationism these countries would produce what they need (maybe not anything).  Other people can produce semi conductors.

But again the main point is ignored - America is where it is because it put itself there.  Nobody tricked it.  It is a major source of Globalization.  If it want to change to isolationism then so be it. 

"If the world wants an unstable, interconnected economy that's too big to fail, they're more than welcome to try it on their own."

Again the big bad world has done something bad to poor little America!!

[Osama + 248]

6 hours ago, mthebold said:

I've noticed that foreigners call me "narrow minded" almost exclusively when they want me to pay for something. 

Unfortunately, y'all lack even the ability to keep yourselves afloat.  Therefore, your opinions don't matter. 

OK

[AcK + 50]

On 2/12/2019 at 12:05 AM, Justin Hicks said:

Never have understood that reasoning.

Wish it were that easy. US doesnt have the largest oil reserves (not even among the top-10). At the current pace of prod, US shale will start declining in another 5-7years. Sooner if the production accelerates led by opec production going offline. US might even be an exporter of oil, but for a very briwlef time period. You want to take on Saudi - no problem. But you cant take Iran, Venezuela, Saudi all on at the same time. Not to mention aligning with whom - Russia - who has a very poor track record of international relations (remember Crimea). Beware what you wish for...

[specinho + 440]

On 2/15/2019 at 1:55 PM, NWMan said:

The model put forward is one of isolationism.  Europe does have North Sea oil but it is to expensive to produce profitably when you can buy oil on the open market.  Europe unlike America is not producing oil at a loss.  If Europe was isolated it would produce oil at a loss because it had to - There is Norwegian Gas and Europe would have to build Nuclear power stations.  So it could produce energy.

South America are a major source of planes and in a world of isolationism these countries would produce what they need (maybe not anything).  Other people can produce semi conductors.

But again the main point is ignored - America is where it is because it put itself there.  Nobody tricked it.  It is a major source of Globalization.  If it want to change to isolationism then so be it. 

"If the world wants an unstable, interconnected economy that's too big to fail, they're more than welcome to try it on their own."

Again the big bad world has done something bad to poor little America!!

 

18 minutes ago, AcK said:

Wish it were that easy. US doesnt have the largest oil reserves (not even among the top-10). At the current pace of prod, US shale will start declining in another 5-7years. Sooner if the production accelerates led by opec production going offline. US might even be an exporter of oil, but for a very briwlef time period. You want to take on Saudi - no problem. But you cant take Iran, Venezuela, Saudi all on at the same time. Not to mention aligning with whom - Russia - who has a very poor track record of international relations (remember Crimea). Beware what you wish for...

It has been a common acknowledgement that the trendy and advanced video games have been rather violent. It teaches nothing but fire and kill................. with friends........... Reminded me a very old game........."mickey mouse fetching eggs"...... For those who are not familiar here's the brief: Mickey Mouse has to be moved left or right to collect the falling eggs in sequence. The higher the falling speed of eggs.... the faster one has to move the mickey mouse........... until enough eggs are broken and game over............ ....... the point is......... while we are busy fetching eggs that are abundant left and right already why not let others be busy with their egg collecting farms?? In case we do not have egg farms........... common sense dictates we can always buy from the farm offering the lowest price................ For world peace........... dear commies (friends of community)....... let's fetch some eggs with mickey mouse.................