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OPEC tried to keep prices high by cutting output but Russia instead started a price war which could see petrol drop to AU$1. With Saudi Arabia and Russia battling it out for market share to get past the US it could be consumers who come out on top. This change could affect many markets from agriculture to shipping having impacts across the world.
Petrol prices in Australia are expected to drop — possibly as low as $1 a litre — after Saudi Arabia started a price war with Russia on Monday.
[...] Prices are falling as Saudi Arabia, Russia and other oil-producing countries argue about how much to cut production in order to prop up prices.
The Organisation of the Petroleum Exporting Countries (OPEC) suggested cutting back oil production to stabilise falling prices but Russia, the world's second-largest producer, did not seem to be on board.
It led to Saudi Arabia, the world's biggest oil exporter, slashing its official selling prices and pledging to release more supply onto the market in an attempt to punish Russia.
The price war saw prices for brent crude, which is the international standard, fall by 25.3 per cent to $33.83 per barrel, and the benchmark US crude drop by 26.1 per cent to $30.49.
It's the biggest price fall for oil since 1991.
Also, according to CNBC Oil Nosedives as Saudi Arabia and Russia set off 'scorched Earth' Price war:
Oil prices fell through the floor in early trading Monday, tanking as much as 30% after Saudi Arabia slashed its crude prices for buyers. The kingdom is reportedly preparing to open the taps in an apparent retaliation for Russia's unwillingness to cut its own output.
"This has turned into a scorched Earth approach by Saudi Arabia, in particular, to deal with the problem of chronic overproduction," John Kilduff, founding partner of Again Capital, told CNBC. International benchmark Brent crude was trading at $33.79 a barrel — down almost 50% year to date — at 10:45 a.m. Singapore time, with West Texas Intermediate at $30.72.
[...] Experts are now calling dramatically lower crude prices as major OPEC and non-OPEC producers ready for an all-out price war after failing to reach an output cut agreement Friday, in a sudden U-turn from previous attempts to support the oil market as the new coronavirus hammers global demand.
[...] The comment came as oil prices are down 48% for the year and two days after Saudi Arabia announced massive discounts to its official selling prices for April, between $6 to $8 lower per barrel across all regions. Plunging price forecasts are also coming amid reports of a possible increase in production by the OPEC kingpin from its current 9.7 million barrels per day (bpd) to as many as two million bpd more.
With previously agreed OPEC+ production cuts expiring at the end of March, Saudi Arabia can theoretically pump as much as it wants — up to its capacity of 12.5 million bpd. And Russian Energy Minister Alexander Novak said Friday that essentially the wheels come off next month: "As from 1 April we are starting to work without minding the quotas or reductions which were in place earlier," he told reporters at the OPEC+ meeting in Vienna, adding, "but this does not mean that each country would not monitor and analyze market developments."
(Score: 3, Interesting) by legont on Tuesday March 10 2020, @12:09AM (5 children)
It's another collusion with Russians to bring gas prices down, please American poor, prevent recession, and get Trump reelected.
Putin is stimulating American economy stricken by the virus.
"Wealth is the relentless enemy of understanding" - John Kenneth Galbraith.
(Score: 2) by edIII on Tuesday March 10 2020, @12:52AM (4 children)
Which is meaningless. You can't stimulate an economy by dropping travel prices, while at the same time issuing strong travel advisories. Those that have disposable income to travel, and then stimulate economies elsewhere, also happen to be in the brackets at high risk with this virus. Industrial transportation will be cheaper, and revenue to the 1% Elites will definitely go up, but it don't mean shit when the consumer refuses to travel to spend money, and there is no worker to stock the products. There has already been a run on basic cleaning supplies. No more alcohol, no more hand sanitizer, no more masks, etc.
The White House says one thing, every other official not in the swamp, says another. It's quite striking the difference between Republicans and Democrats these days. Republicans ham it up in gas masks, with their constituents dying of something that they are desperately trying to make into nothing. Democrats meanwhile are talking about measures to combat this virus.
Meanwhile, the virus spreads....
While I could get into it with several more reasons, suffice to say, cheap fuel isn't going to change what's happening to the economy. It's not going to bring back the stock market, it's not going to get the sick workers back to work, or give any confidence whatsoever to people that things are being handled.
Recession is happening one way, or the other. As for Trump being reelected, that is entirely based on whether or not a Trumper will change his mind. Everyone else is already determined to vote non-Trump. After this shithead-in-chief basically told a bunch of Americans to die on the cruise ship so his numbers could stay good, I doubt every Trumper is as solidly a Trumper as they were 1 month ago.
I can tell you this, and it applies to nearly everyone else around me, and that is, we don't give a fuck about the price of gas right now. We've stilled cancelled trips. Which is really funny personally, because some of our Trumpers in the Midwest refused to cancel their trips... until Pence said it was good idea. Finally. Which paints a pretty morbid picture to me, and that is a lot of Trump supporters dying because they were programmed to not take this shit seriously. I'm pretty sure that will affect his electibility.
Trump will have been the main reason a lot of American's parents and grand parents die this year. Entirely on him. I don't think cheap fuel is going to save him. Especially if dumbfuck keeps kissing flags :)
Technically, lunchtime is at any moment. It's just a wave function.
(Score: 2) by dry on Tuesday March 10 2020, @02:21AM (2 children)
The Trumpers are likely happy to have those elites on the cruise ship die.
(Score: 2) by edIII on Tuesday March 10 2020, @06:41PM (1 child)
You think it's Elites on the cruise ships? Not even remotely dude. There's like maybe 10 cabins on a cruise ship suitable for Elites. The two biggest suites on the cruise ship I was on, were about as a big as a normal hotel room. With the exception of the bathroom, which was about twice as big as a hotel bathroom. It wasn't super ass pricey either, I've seen trips to Europe dwarf the costs, and the costs of my trip to China over 10 years ago were greater.
Normal rooms on a cruise ship for the regular passengers are for people who do not suffer from claustrophobia at all. It's Hong Kong style, and I could barely fit into the bathroom. The whole point of the rooms is that you are not in them at all, but elsewhere on the ship spending money. That's like over 90% of the passengers on a cruise ship.
If cruises are for Elites, then who the fuck is Disney World for? I see a lot of normal families going there, and cruises are no different. 2 weeks at Disney World is going to be several times more expensive than a cruise ship.
What Elites do is rent small yachts for $150,000 for a week or so, or they get invited onto the super yachts with Bill Gates and the like. I've seen pictures of George Clooney on a lot of yachts, but never a cruise ship. There is something like a cruise ship for Elites, except it doesn't have regular passengers at all. Rooms are the size of New York penthouses, and $5-10 million lets you own a permanent mobile home that goes around the world.
If *that* ship was quarantined with the virus, then yes, I would have far less sympathies for them. They're already 10 times better off then the poor fucks doomed on the cruise ship.
Technically, lunchtime is at any moment. It's just a wave function.
(Score: 2) by dry on Tuesday March 10 2020, @07:31PM
It's all relative, to an out of work coal miner, or a Walmart worker, just being able to take the time and spend the money to go on a cruise makes one an elite. Same with Disney Land, takes money and time that so many don't have.
(Score: -1, Flamebait) by Anonymous Coward on Tuesday March 10 2020, @10:40AM
> Which paints a
pretty morbidpleasingly ironic picture to me, and that is a lot of Trump supporters dying because they were programmed to not take this shit seriously. I'm pretty sure that will notaffect his electibility in the least because Trump voters are drooling fucking idiots who are as deep in denial of reality as their crooked orange idol.