Marco
OPEC and Russia had a meeting to reduce production and ....
Tuesday, March 10, 2020, 16:21

try to keep the price of a barrel of oil up. This "Cervesa Sickness" had reduced consumption. Russia gets 25 percent of its GDP from oil and can not afford to reduce production. No agreement could be reached. OPEC will now increase production, flood the market and try to wait out Russia. That's the reason for the drop in the price of a barrel. Russia's cost for on-shore is $18 per barrel, OPEC, $3. Not good. But the worst part is US shale oil production is $73 a barrel. That industry is going to take it in the shorts. This could take some US producers from BBB to junk. That would be around $400 billion dollars about 11% of the bond market. Putin wants to take down the credit and financial system, I think that is his goal, and he may have found a way. This is all about Russia, not Saudi Arabia. He's also moving to get out from under the Petro Dollar valuation. Also, Russia has been stock piling gold. 2019 figures are 2241.86 Tonnes vs. Saudi's 332.1. Russia could hang on longer. Yes the House of Saud does have more fiat currency than Russia. Saudi riyal to the ruble is 1 to 18.99 so we will see how this plays out. Short answer: probably going to suck for US.