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Saudi Instability
Another Thing to Rock Our World
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  • Matt B

    I’d like to understand how suicide bombers in the kingdom raises the possibility of an oil supply disruption. Seems like quite a chain of events would have to occur.

    • Observe&Report

      Ask yourself what might happen if one of the bombers successfully destroys a section of pipeline running from oil fields in the east through the Arabian desert to ports in the west of the country, or detonates a bomb at a oil refinery causing enough damage that the place has to be shut down.

  • FriendlyGoat

    This relates to a question I have been asking myself. Is it more expensive to pay the Middle East “too much” for oil, or is it more expensive to deal with the chaos proceeding from many of those countries when they are economically, then politically destabilized? The current world oil prices do not support Saudi Arabia in the manner to which it had become accustomed. Will they (can they) keep a lid on their own crazies?

    • JR

      The answer is blindingly obvious. They just need to confiscate wealth above a certain level and watch that solve all their problems. I’m surprised you haven’t picked up on that.

      • Jim__L

        Actually Saudi Arabia is a country where all the wealth (oil) goes to the government first, then gets doled out as the government sees fit.

        It should lead to a paradise on earth, no?

        • JR

          OMG, Did you hear that FG? I think this is true of most petro states, including Russia. What a wonderful world those countries live in. I will make sure FG have heard about it. I’m sure being a fact-based fellow that he is, he will totally let this new evidence affect his thinking…

  • PKCasimir

    Whoever wrote this article has absolutely no idea as to what he is talking about. It must have been a long July 4th weekend to write this nonsense. The world is awash in oil and natural gas and there is spare production capacity more than sufficient to cover any pipeline damage in Saudi Arabia. Bombing a pipeline or two in Saudi Arabia will have only a marginal effect on world supply. American frackers are especially nimble.

  • Jacksonian_Libertarian

    “With the world economy already slow and central bankers holding interest rates to historical lows, an oil price shock is the last thing we need.”

    Ridiculous! America and the World are 8 years into “Great Depression 2.0”. If you don’t believe me explain how the Fed can print $4.5 Trillion over a 5 year period (Quantitative Easing) without generating Hyper-Inflation? Or explain how the negative interest rates many Central Banks are now trying are even possible? Deflation means falling prices for all products, as well as falling wages, while any income producing property like stocks and bonds rise in value. Saudi Arabia and the OPEC countries are a parasitic burden on the Global Economy, anything which reduces this burden is of benefit to mankind.
    Back of the envelop calculation: OPEC production 30 million barrels per day x $100/b = $3 billion/day x 365 = $1.095 Trillion/year, at $50/b that reduces the burden on the Global Economy by $1.095 x .5 = $548 billion/year. Since the World Economy is a little over $100 Trillion/year the fall in oil prices alone reduces the costs on mankind by .5 percent. To give you some perspective, the US Economy has been barely growing at 1% per year, and keeps getting revised down as time goes by.

  • Angel Martin

    I’ve been hearing about the likely demise of the Saudis since forever.

    I’m starting to believe the Saudis are like the Portuguese Empire, which was decrepit by the early 19th century, but persisted for decades after the overseas empires of the other european countries had collapsed.

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