Seeking Alpha

"We don't really understand why the prices are behaving the way they are," says Saudi oil...

"We don't really understand why the prices are behaving the way they are," says Saudi oil minister Ali Naimi, vowing to boost the kingdom's oil output 25% if necessary. He dismisses comparisons to the price surge in 2008, saying supply was far firmer then. At the moment, he says, there are no customers asking for additional crude. USO -2.1%.
From other sites
Comments (14)
  • Eighthman
    , contributor
    Comments (213) | Send Message
     
    Has anyone raised any questions about the ability of the Saudis to do this? I thought that they were having output issues.
    20 Mar 2012, 05:00 PM Reply Like
  • DaLatin
    , contributor
    Comments (1522) | Send Message
     
    They have the abilty. A 125 bucks for that thick crap they'de pump 3 times more sludge !
    20 Mar 2012, 05:29 PM Reply Like
  • untrusting investor
    , contributor
    Comments (9951) | Send Message
     
    The Saudi's are probably under political pressure from numerous countries to try and talk the oil price down.
    20 Mar 2012, 07:31 PM Reply Like
  • DaLatin
    , contributor
    Comments (1522) | Send Message
     
    ui, no way !!! OPEC wants higher prices ! They all have big social payouts now and need to drive oil higher. Saudi's are being pressured by members to keep it where it is and who is currently OPECs leader ? Yep IRAN
    20 Mar 2012, 07:38 PM Reply Like
  • untrusting investor
    , contributor
    Comments (9951) | Send Message
     
    D,
    Of course OPEC wants higher oil prices. Don't they always? The point is Saudi Arabia has stated they are prepared to increase production. Why would they do that? The obvious answer is political pressure. Doesn't mean they will or even can increase production much. It's just a political statement by the Saudis and perhaps an attempt to talk down the price somewhat. In the final analysis the Saudi's will be more than happy to accept higher oil prices as well, just as any producer will be.
    20 Mar 2012, 08:06 PM Reply Like
  • redqid
    , contributor
    Comments (11) | Send Message
     
    Saudi Arabia wants oil as high as possible without damaging the world economy. If oil prices go too high, a recession will follow reducing demand and prices.
    20 Mar 2012, 09:20 PM Reply Like
  • untrusting investor
    , contributor
    Comments (9951) | Send Message
     
    R,
    And what is that price that will cause a recession? Just last year sometime the Saudi's were touting the fair price of oil as about $75. And it did trade at around there for a very short while. Well from $75 to $105 is about a 40% increase from the lows last year. Is that enough to cause recession? What about Brent Oil which is another $15+/barrel higher yet?

     

    And given the many many trillions of dollars printed and eased by the Fed, ECB, UK, Japan, not to mention massive easing by China, is there really any reason why oil should not be even higher yet? Why should oil producers or any other real asset producer NOT just keep jacking up their prices indefinitely to cover the obvious devaluation attempts by world central banks?
    20 Mar 2012, 10:45 PM Reply Like
  • DaLatin
    , contributor
    Comments (1522) | Send Message
     
    ui, what your saying seems logical... to you and the typical US or EU person,but i'm from the region an Saudi ALWAYS cheats an always has. They actually have been over pumping at max for 9 months all along. Now they can just declare it all and can convert more of the $s into bullion. And, that is what their doing ! They have the NY Fed holding more an more gold for them. They don't want $ 0s added to the digital balances !
    20 Mar 2012, 08:12 PM Reply Like
  • untrusting investor
    , contributor
    Comments (9951) | Send Message
     
    D,
    That might well be, but global oil supply vs. demand seems to have more than sufficient supply to meet current demand levels. It is a wonder why anybody who sells any type of real good or service would not be demanding more dollars or more euros, or more of virtually any currency. It is clear that all major currency issuers are intent on debasing all major currencies as much as they can.
    20 Mar 2012, 09:09 PM Reply Like
  • WMARKW
    , contributor
    Comments (10383) | Send Message
     
    Geeze...you would think the Saudis would be anxious to flood the market at these prices.
    20 Mar 2012, 09:23 PM Reply Like
  • untrusting investor
    , contributor
    Comments (9951) | Send Message
     
    WM,
    Why? What's going to hold it's value any better than oil? What does one do with more trillions in continually devaluing currency that will do as well or better than having oil in the ground and available as an investment?
    20 Mar 2012, 10:49 PM Reply Like
  • DaLatin
    , contributor
    Comments (1522) | Send Message
     
    Oil is holding it's value because Ben is working hard to devalue the US dollar and that continues. And, the Saudi are pumping full bore. The tankers are still sitting waiting to unload.....

     

    I think the oil boys hope Iran keeps jawboning for years !
    21 Mar 2012, 05:18 AM Reply Like
  • Eighthman
    , contributor
    Comments (213) | Send Message
     
    Some years ago, the WSJ published an article to the effect that the Saudis have carefully manipulated oil prices to avoid alternative energy development and recessions. Supposedly, they take a longer term view than others.

     

    I still wonder about rumors that their fields are drying up.
    21 Mar 2012, 01:36 PM Reply Like
  • DaLatin
    , contributor
    Comments (1522) | Send Message
     
    Saudis are among the world leaders in alternative energy an desalination to. They invest their money well. Except the dumb Price buying Citybank an a few other blunders,but, the King hasn't beheaded him yet. he is a great front on CNBC !
    21 Mar 2012, 01:42 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Tools
Find the right ETFs for your portfolio:
Seeking Alpha's new ETF Hub
ETF Investment Guide:
Table of Contents | One Page Summary
Read about different ETF Asset Classes:
ETF Selector