These 6 Countries Will Be Screwed If Oil Prices Keep Falling - Business - Nairaland
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| These 6 Countries Will Be Screwed If Oil Prices Keep Falling by jpphilips(m): 2:40pm On Oct 17, 2014 |
The collapse in oil prices is already a major cause of concern for countries heavily reliant on exports of the commodity. For some, it could be a matter of avoiding a severe recession. Here's why: For governments in oil-exporting countries to meet their spending commitments they need oil to remain above a certain price. With oil prices under $87 a barrel, countries that rely on high oil prices, including Venezuela, Russia, and Saudi Arabia, may have a reason to be concerned. This chart shows the price per barrel that the six most exposed countries need to meet their national budgets. Remember, the price Friday is a piffling $87: View photo . oil price breakevens Deutsche Bank estimates Venezuela literally needs the price of oil to double to keep its house in fiscal order. If the price remains depressed, these countries will either be forced to borrow more to cover the shortfall in oil tax revenues or backtrack on spending promises. Cutting back on spending pledges would be highly embarrassing for these countries' governments. In the cases of Russia and Venezuela, tapping bond markets for financing could be very expensive as both countries are currently regarded as highly risky by international investors. The problem for the Organization of the Petroleum Exporting Countries is that it may no longer be able to control prices (as it has in the past) to avoid these problems. Previously, OPEC members would agree to cut oil production if falling prices posed a threat. That may now have changed because of the shale oil boom in the US, which has dramatically increased supply. As Goldman Sachs wrote in a recent note (emphasis added): [There is a] realization that the OPEC reaction function has changed and that the US shale barrel is now likely the first swing barrel ... When Saudi Arabia cut prices to Asia for November delivery it was interpreted as a shift in the Saudi reaction function to a focus on market share. This should have not been a surprise in the new world of shale that has flattened the supply curve, as economic game theory suggests that they should not be the first mover and that the US shale barrel should be the new swing barrel given how easily it can be scaled up and down. This may explain Saudi Arabia's unusual hints to market participants recently that it was comfortable with sub-$90-a-barrel oil prices — it doesn't want to admit that its power to shift the price has been eroded. Courtsey; Yahoo news |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by jpphilips(m): 2:43pm On Oct 17, 2014 |
It is so laughable when Nigerians keep quiet as senate increase oil benchmark yearly, I pity civil servants when the country goes broke, Greece in Africa will be the new slogan. For those of you warming up to vote Jonathan 2015, continue.......... 1 Like |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by SMALLPENIS(f): 2:44pm On Oct 17, 2014 |
Only one thing to do then! Turn to Agriculture!  Like the days of old. |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by Princecalm(m): 2:45pm On Oct 17, 2014 |
With what i just read Nigeria can never get into that list. |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by jpphilips(m): 2:46pm On Oct 17, 2014 |
Princecalm: It is one thing to read, it is a diff ball game to understand 4 Likes |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by jpphilips(m): 2:53pm On Oct 17, 2014 |
Interesting that oil prices have never been this low for decades and how oil prices used to spike as soon as there is a problem in the middle east even though most of the oil consumed in the usa is produced in the usa. Now that the objective is to bring Russia to its economic knees all of a sudden the price just keeps falling even as ISIL continues its rampage in the middle east something that would have spiked the price of oil in the past and give the oil barons gargantuan profits. The beauty of Economic war, the US of A is truly a world power!! Lets see how the Rocker fellers will respond to the US shale oil buisness. 1 Like |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by dgitrader(m): 2:59pm On Oct 17, 2014 |
jpphilips: u got it twisted the finance minister appointed by GEJ has persistently fought for lower benchmarks, lower than 75$ /barrel. Google is ur friend. Theres nothing political about the slump in oil price, as the conspiracy theorist claim. Why would the west use a strategy that break the back of S/arabia , canada, etc just to hurt russia? Oil price crash is purely economics, more supply plus lesser demand coupled with u.s production. This development has been long anticipated. And yes... nigeria will be seriously battered by it. FGs revenue will start crashing sooner than expected. |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by Princecalm(m): 3:01pm On Oct 17, 2014 |
jpphilips:first of all the countries you mentioned were not up to six,secondly,it will only affect countries who are heavily reliant on export and Nigeria don't fall to that group. |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by jpphilips(m): 3:10pm On Oct 17, 2014 |
dgitrader: Did you hear yourself? who told you the minister fought? I am talking about the benchmark approved by the president as submitted by the minister? use your head before using google, the Senate always approve in line with what comes from the presidency, for the past 5yrs, it has always been an average of +/- $5/bbl. What do we need $75/bbl for when we cannot make a single investment in infrastructural development? when all the institutions have failed? when you have more ghost workers than real employees? when you allow the MP's to increase their wages as they like? feed the president and family with the national budget of Cape verde? I dont blame you shaa, |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by dgitrader(m): 3:11pm On Oct 17, 2014 |
Princecalm: nigeria wasnt list am sure in error, but we r chief on the list. |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by jpphilips(m): 3:14pm On Oct 17, 2014 |
Princecalm: Ya! because you are dumb enough not to realize that you are not reading the whole article. [url]http://finance.yahoo.com/news/6-countries-screwed-oil-prices-110424494.html [/url] |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by dgitrader(m): 3:17pm On Oct 17, 2014 |
jpphilips: the blame here, is on the person who ignorantly didnt know the fg benchmarked $72? Per barrel, but ur legislators jecked it up. Believing oil will always be above $100pb as in the previous years. |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by jpphilips(m): 3:19pm On Oct 17, 2014 |
dgitrader: what do you know? It is about who holds the key to change the dynamics of oil prices! |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by jpphilips(m): 3:25pm On Oct 17, 2014 |
dgitrader: Common sense says, that the Government is wasteful as such does not need the $72, they could not justify it and Iweala was too retarded to put up a convincing argument with the senate. when the FG throws a $72 card on the table, the senators form a benchmark from there, the reason they jerk it up. I don't know why most of you hardly understand anything. |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by dgitrader(m): 3:29pm On Oct 17, 2014 |
jpphilips: how long do u think big players can manupulate oil price? And what what cost? And has it ever occure in history? Go and ask the almighty opec. My bro, its purely dd and ss. btw, i know a little enough because i earn a living from trading oil, commodities and equities. |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by dgitrader(m): 3:34pm On Oct 17, 2014 |
[quote author=jpphilips post=27222635] [color=#000099]Common sense says, that the Government is wasteful as such does not need the $72, they could not justify it and Iweala was too retarded to put up a convincing argument with the senate. when the FG throws a $72 card on the table, the senators form a benchmark from there, the reason they jerk it up. I don't know why most of you hardly understand anything. read your post again |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by dgitrader(m): 3:47pm On Oct 17, 2014 |
Mr Russia and isis, as far back as april the global refinaries were over producing, inventories were over stocked, new supplies were increasing, what do u expect? Indications that Oil will be the Next Commodity to Crash By Dian L. Chu| Mon, 01 July 2013 The Free Oilprice.com Energy Intelligence Report gives you this and much more. Click here to find out more. We have seen how Gold and Silver were viciously attacked by the shorts this past week, and surprisingly Oil escaped the carnage which is interesting because in April Oil was taken down to the $86 level during the last attack on the Gold and Silver markets. This is even stranger considering the fundamentals for the Oil market are even more bearish than they were in April from a supply standpoint as exemplified by the latest EIA report on Wednesday on this week. There is little doubt however that since the easy money is gleaned from the Gold attack, the Feral Hogs will start looking for their next target, and the Oil market will be high on their list in the upcoming months as the summer driving season winds down, and bulging supplies start to weigh on trader`s sentiments. This week`s EIA report identifies the problem with the Oil market as we had refineries running at the highest utilization rate of the year at 90% and yet there still wasn`t a draw in crude supplies. There have only been like 4 or 5 draws the entire year in Crude supplies. With Oil inventories above 390 million during the strong part of the year for oil demand, what happens to supplies when the slower part of the demand cycle kicks in for petroleum products? |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by jpphilips(m): 3:48pm On Oct 17, 2014 |
dgitrader: |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by Princecalm(m): 6:48pm On Oct 17, 2014 |
jpphilips:because you are so stupid and lazy not to post the whole article |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by dgitrader(m): 8:42pm On Oct 23, 2014 |
^^Dont mind the dude. He posted incomplete article because he was in a hurry to play baseless politics and argue blindly Princecalm:. |
| Re: These 6 Countries Will Be Screwed If Oil Prices Keep Falling by Truckpusher(m): 12:40am On Nov 14, 2014 |
jpphilips:Yes the US of A is a world power and they are using it as a weapon against Kremlin to come back to her senses,even as Kremlin demands to be treated with equal respect and dignity. The Rockers Fellers are well aware ,it is just a game,Govt will simply mortgage the future of a nation more to them,because they hold the Govt by the balls ......Only this time for Kremlin,the Brits and the Yankees seems to be holding all aces |
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