Quote:
Originally Posted by xoxoxoBruce
The Russian budget was fixed on oil staying at $100.
|
Appreciate significance of that fact. For example, Venezuela oil could be profitable at $30 or $40 per barrel. But the economy has been so corrupted that Venezuela suffers losses with oil at less than $120 per barrel.
Russia has a similar problem due to how Putin has corrupted and manipulated his oil industry as a tool for government policy.
Many want to blame Saudi Arabia for intentionally harming the market. Saudis have a long history of using their oil to bring sanity back to this market. It is not obvious what their objectives are this time. Putin, of course, accuses the Saudis of acting as an American tool to harm the Russian and Venezuela. However, also potetially hurt will be American fracking operations that need oil to stay well above $60 per barrel.
See Chesapeake Oil stock to appreciate what oil prices have done.