EconAir

Saudi Oil Minister Introduction: The Fall in Oil Prices in 2015 Crude oil prices temporarily rose because Saudi Arabia signaled that it would cooperate with OPEC and non-OPEC producers to “stabilize” oil prices.   Nothing specific was mentioned.   At the current price and for political reasons, it is unlikely Saudi Arabia and its Persian Gulf allies will cut production or negotiate joint production cuts with other large producers.   The comments are probably an indication that Saudi Arabia might be part of a global reduction in crude oil production if prices go much lower and the political situation in Syria changes. Until recently, Saudi Arabia was seeing the results it wanted.   Some are economic, having to do with the current and future price and production of oil.   The economic targets were shale production in the U.S and tar sands production in Canada.   The geopolitical targets were Iran and Russia.   But unexpected economic and...

Middle East Oil Wells OVERVIEW Outside of the United States and Canada, most of the world’s oil and natural gas is owned and produced by governments or government-dominated companies with minority shareholders. Two examples of the latter, public companies with stockholders, are Petrobras in Brazil and Gazprom in Russia.   But government officials, especially the president, control management and make the important decisions. Production and investment decisions are not made based on financial criteria alone.   Often, internal political or foreign geopolitical factors are more important. Many countries' economies and government budgets depend critically on oil and natual gas revenue from exports. Maintaining internal peace and welfare programs are more important than rational economic considerations. What this means is that production and distribution decisions in these countries are made using different criteria than by private companies in the United State...