23 Dec 2014
Russia could be among highest beneficiaries of higher oil prices – BBH
FXStreet (Barcelona) - The Brown Brothers Harriman Team cite the Saudi oil ministers comments that Russians, Brazilians and the US shale oil producers could be the highest beneficiaries if OPEC cut its output, as the price rise may enable them to capture OPEC’s market share.
Key Quotes
“Russia could be among the biggest beneficiaries of higher oil prices. Brent crude oil prices have stabilized around $60 a barrel in recent days. However, the risk is still on the downside. The Saudi oil minister was quoted in the media indicating that its decision not to cut production regardless of the price. "Whether it goes down to $20, $40, $50, $60 is irrelevant." He explained that if Saudi Arabia, or OPEC cut its output, the price will go up and the Russians, the Brazilians, US shale oil producers will take my share”."
“Saudi Arabia clearly wants to reduce the supply of oil by squeezing out the high cost producers. US shale producers, like Canada's tar sands and Brazil's deep water fields are high cost producers. Given the amount of oil being produced, and possibility that US will relax its ban on oil exports, US shale producers are the most immediate threat.”
Key Quotes
“Russia could be among the biggest beneficiaries of higher oil prices. Brent crude oil prices have stabilized around $60 a barrel in recent days. However, the risk is still on the downside. The Saudi oil minister was quoted in the media indicating that its decision not to cut production regardless of the price. "Whether it goes down to $20, $40, $50, $60 is irrelevant." He explained that if Saudi Arabia, or OPEC cut its output, the price will go up and the Russians, the Brazilians, US shale oil producers will take my share”."
“Saudi Arabia clearly wants to reduce the supply of oil by squeezing out the high cost producers. US shale producers, like Canada's tar sands and Brazil's deep water fields are high cost producers. Given the amount of oil being produced, and possibility that US will relax its ban on oil exports, US shale producers are the most immediate threat.”