# Saudis Cut Oil Prices to U.S., Which Pressures Domestic Oil Industry



## Denton (Sep 18, 2012)

> Oil prices tumbled to their lowest point in more than two years after Saudi Arabia unexpectedly cut prices for crude sold to the U.S., likely paving the way for further declines and adding to pressure on American energy producers.
> 
> The decision by the world's largest oil exporter sent the Dow industrials DJIA, +0.11% into negative territory for the day amid concerns about the pace of global growth.
> 
> ...


Saudi oil-price cut takes market by surprise - MarketWatch

The prices are falling at the gas pumps, but our own industry will suffer.

Mixed emotions on this.


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## whoppo (Nov 9, 2012)

Also mixed about this, but I've gotta say I'm having a hard time feelin' bad for the big oil companies who've been rear-ending us for all these years. I do feel bad for the small guys with a few dozen pumps rockin' in the south forty... they're going to hurt some on this.


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## Inor (Mar 22, 2013)

whoppo said:


> Also mixed about this, but I've gotta say I'm having a hard time feelin' bad for the big oil companies who've been rear-ending us for all these years. I do feel bad for the small guys with a few dozen pumps rockin' in the south forty... they're going to hurt some on this.


Average profit margin of 5.2% is hardly rear-ending us. That is especially true when you consider the government is making several times that in oil and gas taxes.

http://www.beg.utexas.edu/energyecon/energy-inc/members/Course_Modules/Module_III_RM/API%20profit%20margins.pdf


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## tks (Oct 22, 2014)

Opec is scared sh#tless.We are still their largest, by a wide margin, customer. Between fracking and domestic oil production, we are within a few years of independence from them. If we opened up the oil fields in ND and AK, they'd be screwed and they know it. They are dropping prices in a desperate attempt keep that from happening.


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## Urinal Cake (Oct 19, 2013)

The oil cartel is pissing on each other trying to drive the prices down as a response to the US oil companies..... The U.S companies can wait them out, we will still have our oil as they deplete theirs!
Fok them towel heads!


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## HuntingHawk (Dec 16, 2012)

I completely agree with tks. OPEC is nothing more then a world monopoly on crude oil. OPEC can no longer say, "this is the price, take it or leave it". OPEC countries were getting rich when oil was $50 per barrel so why did they raise it to $100 per barrel other then greed.

And the companies doing the fracking & off shore here are making plenty of money also.

The bottom line is the price at the pump.


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## Inor (Mar 22, 2013)

Not only is it having an effect on the raggies, it is also putting HUGE pressure on Russia which makes me VERY happy. The Russian economy is still heavily dependent on selling oil and gas to Europe. If prices go down too much, they collapse.


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## Camel923 (Aug 13, 2014)

It is also messing with Russian production. This revolves around Syria, pipeline from the oil rich Arabs to send gas to Europe and Russian gas as well as US concerns. Quite a mess. All the big boys are involved.


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## Boss Dog (Feb 8, 2013)

Revelation 6:6
We do live in interesting times.


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## Michael_Js (Dec 4, 2013)

Boss Dog said:


> Revelation 6:6
> We do live in interesting times.


Hmmm...I'm sure it was Olive Oil 

No, not associated with Popeye!


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## Boss Dog (Feb 8, 2013)

Olive oil was used in lamps as well as for food, and could conceivably be used for a small heater. 
What good is olive oil if you cannot afford some kind of meal to make bread or veggies for a salad.


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## thepeartree (Aug 25, 2014)

whoppo said:


> Also mixed about this, but I've gotta say I'm having a hard time feelin' bad for the big oil companies who've been rear-ending us for all these years. I do feel bad for the small guys with a few dozen pumps rockin' in the south forty... they're going to hurt some on this.


Speaking as someone with a tie to a certain local well, I can tell you that the money made from truly local-size wells is about enough to buy a gourmet dinner for 3 at McDonalds. Per year!


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## Ripon (Dec 22, 2012)

I don't know about Maine. But for those in California I do know the government makes about 21% on the cost of a gallon of gasoline. This while the government doesn't have to invest in exploration, drilling, or pay anyone. Meanwhile those evil corporations pay a 35% profit tax on their 5 or so percent profit.



whoppo said:


> Also mixed about this, but I've gotta say I'm having a hard time feelin' bad for the big oil companies who've been rear-ending us for all these years. I do feel bad for the small guys with a few dozen pumps rockin' in the south forty... they're going to hurt some on this.


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## OC40 (Sep 16, 2014)

This was a theory a few years back before FRACKing really took off. OPEC is going to get strangled out of the market, but due to politics the USA made the mistake of tying itself tightly to a world energy market / economy. Because of this, they, the smaller companies will get caught between the Big 5 and the USA oil price fight will get squashed. These are the smaller companies that carry a massive debt load from start up. Between the EPA, and Taxes these smaller companies found themselves betting on a longer term before the "crunch" started between USA oil/Fracking and OPEC price adjusting. 

Rumor has it the USA of could be energy independent as early as 2017 if not sooner. The problem comes with the markets that are tied to it, mainly plastics and technology products. IF we (USA) can return to making these products state side we have a chance to distance ourselves from the world markets as a consumer and return to a place of supplier. Its going to be a hard road ahead for many of the smaller companies that's for sure, though when you post 93 Billion in profits its hard to feel bad for OPEC/BIG 5 oil companies. 

Food for thought and a reason why the USA needs to distance itself from the world market from a consumer point of view.


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## Ripon (Dec 22, 2012)

If someone can prove me wrong I'd be glad to hear it, but in my estimate its the strength of the dollar (due to the lack of strength in other currencies) that has helped force oil back to reality. $80 a barrel - who'd have thought you could buy oil for the same fiat currency you could 8 years ago today? Only reason why is the dollar is still king out there; nothing competes with it, nothing even close.


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## jro1 (Mar 3, 2014)

yup, seen that today, we are almost below a $1/L here in Alberta, havent seen that in quite a few years


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## cdell (Feb 27, 2014)

We are $1.11/L in Sask, lowest in a long time. While I'm happy to see my fuel bill drop I am concerned about how this will affect the economy and my own company. A lot of the work we do relates directly back to the oil companies and I suspect a sustained lower price will cause them to start tightening up and reconsidering projects.


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## jro1 (Mar 3, 2014)

cdell said:


> We are $1.11/L in Sask, lowest in a long time. While I'm happy to see my fuel bill drop I am concerned about how this will affect the economy and my own company. A lot of the work we do relates directly back to the oil companies and I suspect a sustained lower price will cause them to start tightening up and reconsidering projects.


Natural Gas drilling is still strong here! might affect oil drilling over the winter, but it's hard to say cause all the Service companies are hiring like crazy, usually they know whats coming down the pipeline before anyone else, And it looks like Harper has been making deals with china over the last year, also there is going to be billions in foreign investment coming into Alberta over the next year, I think Harper made some smart deals whith the Chinense to keep us from falling into recession when it hits the US! The only problem is that we will be working for the Chins, BUT, we will be working nonetheless!! So don't sweat it Bro!


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## jro1 (Mar 3, 2014)

Inor said:


> Average profit margin of 5.2% is hardly rear-ending us. That is especially true when you consider the government is making several times that in oil and gas taxes.
> 
> http://www.beg.utexas.edu/energyecon/energy-inc/members/Course_Modules/Module_III_RM/API%20profit%20margins.pdf


Exactly, it's OPEC who decides whos getting raped! Big oil isnt so big anymore, Big guv has the final say now!


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## bigwheel (Sep 22, 2014)

Inor said:


> Not only is it having an effect on the raggies, it is also putting HUGE pressure on Russia which makes me VERY happy. The Russian economy is still heavily dependent on selling oil and gas to Europe. If prices go down too much, they collapse.


Right right. Bad news for Pooty Poot is good news for us..not that Bathouse Barry could figure out how to work it to the advantage of the good guys..since only commie muzzie homos are good in his eyes. We have a sick situation going on here.


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## aboole71 (2 mo ago)

This was a theory a few years back before FRACKing really took off.


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