Way Oversold, page-39

"As I mention before all the oil producers (OPEC cartel) require oil above 100 to balance their budget"

What a gross generalistation. It's not as simplistic as that, and then some. And most do not need oil above 100. And they can always cut their budgets in any case to meet their revenues (may not be too popular though)

While it may be true that some OPEC members need oil prices to be higher to meet their social agendas (esp Venezuela), some of the larger producers do not, especially Saudi Arabia, where the current cost of extracting the already found oil is $8 per barrel.

I think the larger lower cost producers in OPEC will reassert themselves at the expense of the higher cost producers and eventually force everyone into cuts, but for now the higher cost producers will be allowed to bleed. So there is manoeuvring going on inside of OPEC as well.

It is also true that Russia is getting screwed at the current prices and the Yanks are loving this. This is the main game at present.

The winners will be the USA and China, which are the highest using energy countries. Also some countries (like Indonesia for example) with heavily state subsidised petrol prices, their govt books will look a whole lot better at the current prices.

Let us not forget that the oil situation is a two way street. For every $1 revenue lost, it is saved somewhere else.