A few months ago, Rashid Abanmy, President of Saudi Arabia Oil Policies and Strategic Expectations Center stated that Arabia will force the price of oil down, in an effort to put political pressure on Iran and Russia. His prediction was correct.
Saudi Arabia is selling oil cheap for political reasons.
In an attempt to pressure Iran to limit its nuclear program, and to change Russia’s position on Syria and Ukraine, the Saudis will sell oil below the average spot price at $50 to $60 per barrel in the Asian markets and North America. The marked decrease in the price of oil in the last three months, from $115 per barrel to $55, was caused by the US and its obedient satellite, Saudi Arabia.
Western press are being told to publish the lie that the Saudis are trying to undermine American oil production. But that is nonsense. Saudi Arabia does what the US tells it to do. They are partners in crime.
The bold move to drop oil prices dramatically was a political move by the west to attempt to topple Russia’s economy. Sanctions weren’t working, so now they are using oil prices in a desperate attempt to hurt Putin and force him to his knees.
Russia, the world’s biggest producer and exporter of oil, is affected greatly by a loss of profit in oil sales. Oil is the base for Russia’s economy. With oil demand declining in Europe and America, due to off-shoring, bad economy, and business shutdowns, Washington DC and Riyadh apparently decided it was an opportune time to force oil down farther in a war-like move to punish Russia and Putin.
The question is, how badly will this affect Russia? No doubt it is hurting … but China’s President has already bolstered Russian stability by agreeing to a $24 billion currency swap to strengthen the ruble and make trading easier between the two partners. PlusChina recently lent Russia $6 billion to help the Kremlin renationalize the key unit of oil major YUKOS underpinning oil-hungry Beijing’s efforts to tap into Russia’s huge energy business. Plus, Russia and China are planning a $25-$30 billion oil-for-loans deal.
China, the world’s biggest oil consumer, is scrambling to satisfy surging oil demand by picking up assets in Iran and Russia. Rosneft is seeking to borrow up to $30 billion from China in exchange for possibly doubling oil supplies, making Beijing the largest consumer of Russian oil and further diverting supplies away from Europe, one of the world’s biggest oil importer. Russian President Vladimir Putin is currently in the process of diverting more energy to Asia.
Rosneft wants to borrow money to complete a $55 billion acquisition of rival TNK-BP to become the world’s largest listed oil producer. As Russia’s leading oil company, controlled by the Kremlin, Rosneft is considering ultimately doubling supplies to China. China sits on over 3 trillion of dollars in reserves and are looking to diversify their investments. China has assured Russia that it is ready and willing to come to their aid should it be needed. This backing assures that Russia will survive the economic and political attack from the west.
Meanwhile, we can enjoy the lower price of gas at the pump, and it will surely have a beneficial effect on our economy.
_________________________________________________________________