Scotland Dodged a Bullet....

[Clinton Huxley]

With the oil price spiralling down, looks like the Scots dodged a bullet by voting "Naw" in the referendum. If the price stays low, the largest industry in the North Sea will be decommissioning oil rigs.

[mistermack]

I think we should have a proper referendum. Across the whole United Kingdom.

Should Scotland be an independent country? Or should they shut the fuck up, close the Scottish Parliament, and be a genuine part of the UK?

That's what SHOULD happen. And I wouldn't like to predict the outcome.

[Hermit]

Low oil prices may result in rigs being mothballed. Before long, though, prices will rise again. North sea oil production will resume with a minimum of fuss.

[mistermack]

I'm surprised that countries like Saudi keep pumping oil, when the price drops to this level.
Surely, they must have enough fucking money by now? If I was in charge in Saudi, I would just close the shop till the price hit 100 dollars again.
The oil isn't going to drain away.

Mind you, this price is going to hit the very thing that caused the price-drop, the american shale-oil industry, too. Does that remain economic at these prices? I have my doubts. You would think that the price is bound to level out higher than the current levels, so you would expect people to be stocking up if they can.

[Hermit]

I'm surprised that countries like Saudi keep pumping oil, when the price drops to this level.

Don't you read any news? The price has dropped because the Saudis have increased oil production. They are doing this to fuck with Iran and Russia.

[mistermack]

I'm surprised that countries like Saudi keep pumping oil, when the price drops to this level.

Don't you read any news? The price has dropped because the Saudis have increased oil production. They are doing this to fuck with Iran and Russia.

Link?
I read the news, but didn't read that.
Every news comment I've heard puts it down the the US shale industry, and falling growth in China and Europe etc., leading to a drop in demand.

I did read that OPEC didn't vote for any change in agreed production levels, but didn't see any report of the Saudis increasing production.

Normally, the production levels are agreed at the OPEC meetings, and Saudi boosting production would be breaking the agreed quota.

[Hermit]

Whoops. My mistake. You are right.

I misremembered the details in this article which reports that the Sudis put the kibosh on a lowering of production rates by the OPEC cartel in order to hurt Iran primarily, and have a swipe at Russia into the bargain. With its cash reserves it could theoretically keep the screws on for years, but I doubt it will keep them on for more than a few months.

[mistermack]

Being that Saudi is practically run by the US, I'm not surprised that they want to hurt Russia.
And of course, they can afford the losses. Or lower profits, rather.
But naturally, it is going to affect the shale industry profits in the US.

If I had invested big money in shale, in the US, I wouldn't be very happy right now, with my government.

[Clinton Huxley]

I wonder what the SNP would be saying about the oil price now, if they'd won the vote. Probably something like, "Oh, it's deffo going to be $200 a barrel next year...."

[klr]

I thought that it was non-OPEC countries - who have an increasing share of global oil production/reserves - who were mostly responsible for keeping production up and prices down.

Also, I wouldn't underestimate the effects of (say) fracking. Not necessarily the actual production, but the possibility of it. And maybe also the global recession. You want people to consume more of your product? Produce more of it, and let the price drop.

[JimC]

...fired by Seth.

Spend some more hours at the range.

[mistermack]

I think the Scots need to be careful now, of pushing it too far.

A lot of people I know are getting sick of hearing about Scotland, and the more we hear, the less investment will go north of the border.

Nobody likes long-term uncertainty, when making long-term investments.
I'm betting that a lot of damage has already been done, but you won't see the results of it for a few years. But if the subject of independence is kept in the news, the damage will keep occurring.

The financial sector will be the first to show the signs. I'm betting the figures will start to look bad in two to three years.