Saudi Arabian Oil Price manipulation could sink the Russian Economy

[Mercenary]

Saudis are using their oil power to undercut Russia and Iran for their support of Assad in the Syrian Civil War.

Not sure how the Russians will react? Could sell Iran more advanced weaponry or a major arms shipment to Syria.

Things are taking a turn for the worse.

Saudi Arabia's Oil Price 'Manipulation' Could Sink The Russian Economy - Yahoo Finance Canada

Saudi Arabia's Oil Price 'Manipulation' Could Sink The Russian Economy
By Tomas Hirst | Business Insider – Mon, 13 Oct, 2014 6:13 AM EDT

The vice-president of Russia's state-owned oil behemoth Rosneft has accused Saudi Arabia of manipulating the oil price for political reasons. Mikhail Leontyev was quoted in Russian media as saying:

Prices can be manipulative. First of all, Saudi Arabia has begun making big discounts on oil. This is political manipulation, and Saudi Arabia is being manipulated, which could end badly.

The news comes as Reuters reports Saudi officials have been privately admitting to oil market participants that they are comfortable with lower oil prices. According to the news service, the Organization of the Petroleum Exporting Countries (OPEC) is willing to accept prices as low as $80 a barrel for as much as the next two years.

Falling prices are of particular concern to Russia. Russia needs high oil prices to buoy its economy. The country has seen its economic performance slow under the weight of sanctions over Ukraine and weakening domestic demand. The Russian Central Bank forecasts growth over 2014 to be a meager 0.4%, improving marginally to between 0.9%-1.1% in 2015.

The problem is that Russia's latest budget requires oil prices to average at least $100 a barrel in order to cover the government's spending promises. The government already needs to borrow around $7 billion from foreign investors next year and as much as 1.1 trillion rubles ($27.2 billion) from domestic investors. Given the country's sanctions-imposed isolation from international bond markets, any additional borrowing would be a big concern for policymakers in Moscow.

Finance Minister Anton Siluanov has already acknowledged that the budget forecasts for both Russian GDP growth and oil prices are "optimistic." During the Reuters Russia Investment Summit in September he was quoted as saying:

There are risks to economic growth rates. It is a rather optimistic forecast; there are risks to the oil price. Without a doubt, this and the next year we will have to try very hard to ensure the planned growth rates.

If the forecast growth fails to materialize and the oil price continues its slide it could force the Russian government into an embarrassing retreat on spending commitments and increase the country's economic woes.

 

[SanjeevaniButi]

That is good news for India thought. Cheap oil and that should also push down the price of PAK FA.

 

[general_yermolov_stalin]

Russians should fire a few kh-101 stealth cruise missiles on Saudi oil processing facilities,refineries and oil terminals.That will be enough to send Saudi Arabia into chaos as its population will rebel once the oil funds dry up and Al-Saud will fall.

 

[flamer84]

Russians should fire a few kh-101 stealth cruise missiles on Saudi oil processing facilities,refineries and oil terminals.That will be enough to send Saudi Arabia into chaos as its population will rebel once the oil funds dry up and Al-Saud will fall.

Lol at the butthurt just because the Saudis can affect Russia from far away while the "superpower" can't do anything about it.No "polite green men" in the desert huh ?

@al-Hasani @Arabian Legend @JUBA @Bubblegum Crisis

 

[general_yermolov_stalin]

Lol at the butthurt just because the Saudis can affect Russia from far away while the "superpower" can't do anything about it.No "polite green men" in the desert huh ?

@al-Hasani @Arabian Legend @JUBA @Bubblegum Crisis

No butthurt.simple methods with no identification. A few well-placed hits on saudi oil infrastructure by the Bars and Severodinsk stealth subs via kh-101 stealth SLCM's and we have enough chaos for months/years combined with a potential mass revolt in Hejaz shia region which is oil bearing .The Al-sauds prefer American mercs companies as their elite guards.
Mercenaries Inc.: How a U.S. Company Props Up the House of Saud - by William D. Hartung
That speaks volumes to me.

Second, Russia is mainly dependent on gas revenues. Oil is secondary. There is enough pain with EU's bargaining power as a buyer ,hence the diversification to China .

 

[UnChosen]

Unlike the Cold War era Saudi Arabia no longer has more oil than the world can find uses for, and its economy is far bigger than it was back then. It's political structure has also grown to depend on oil money to keep the people happy.

There's no way the Saudi can keep this up for long unless it wants to turn its economy back years and risk a backlash from its people just to have a price war with the Russians. Even then, with China and India no longer out of the picture like it was 30 years ago, you can be sure they will try to stockpile, so don't expect the price to stay low.

 

[Belew_Kelew]

Russians should fire a few kh-101 stealth cruise missiles on Saudi oil processing facilities,refineries and oil terminals.That will be enough to send Saudi Arabia into chaos as its population will rebel once the oil funds dry up and Al-Saud will fall.

and in return the saudi should get some of these nukes pakistan holding for them, wrap it around some so called lunatic suicide bombers and let it rip in moscow and other russian cities and call them terrorists. what world do you live in buddy these days bigger countries can get hurt harder than small one's.

 

[Lux de Veritas]

Saudis are using their oil power to undercut Russia and Iran for their support of Assad in the Syrian Civil War.

Not sure how the Russians will react? Could sell Iran more advanced weaponry or a major arms shipment to Syria.

Things are taking a turn for the worse.

Saudi Arabia's Oil Price 'Manipulation' Could Sink The Russian Economy - Yahoo Finance Canada

Saudi Arabia's Oil Price 'Manipulation' Could Sink The Russian Economy
By Tomas Hirst | Business Insider – Mon, 13 Oct, 2014 6:13 AM EDT

The vice-president of Russia's state-owned oil behemoth Rosneft has accused Saudi Arabia of manipulating the oil price for political reasons. Mikhail Leontyev was quoted in Russian media as saying:

Prices can be manipulative. First of all, Saudi Arabia has begun making big discounts on oil. This is political manipulation, and Saudi Arabia is being manipulated, which could end badly.

The news comes as Reuters reports Saudi officials have been privately admitting to oil market participants that they are comfortable with lower oil prices. According to the news service, the Organization of the Petroleum Exporting Countries (OPEC) is willing to accept prices as low as $80 a barrel for as much as the next two years.

Falling prices are of particular concern to Russia. Russia needs high oil prices to buoy its economy. The country has seen its economic performance slow under the weight of sanctions over Ukraine and weakening domestic demand. The Russian Central Bank forecasts growth over 2014 to be a meager 0.4%, improving marginally to between 0.9%-1.1% in 2015.

The problem is that Russia's latest budget requires oil prices to average at least $100 a barrel in order to cover the government's spending promises. The government already needs to borrow around $7 billion from foreign investors next year and as much as 1.1 trillion rubles ($27.2 billion) from domestic investors. Given the country's sanctions-imposed isolation from international bond markets, any additional borrowing would be a big concern for policymakers in Moscow.

Finance Minister Anton Siluanov has already acknowledged that the budget forecasts for both Russian GDP growth and oil prices are "optimistic." During the Reuters Russia Investment Summit in September he was quoted as saying:

There are risks to economic growth rates. It is a rather optimistic forecast; there are risks to the oil price. Without a doubt, this and the next year we will have to try very hard to ensure the planned growth rates.

If the forecast growth fails to materialize and the oil price continues its slide it could force the Russian government into an embarrassing retreat on spending commitments and increase the country's economic woes.

Lol at the butthurt just because the Saudis can affect Russia from far away while the "superpower" can't do anything about it.No "polite green men" in the desert huh ?

@al-Hasani @Arabian Legend @JUBA @Bubblegum Crisis

@al-Hasani @Arabian Legend @JUBA @Bubblegum Crisis
@vostok

This article is entirely BS. A low oil price will sink Saudi faster than Russia.

Oil producing nations in the Middle East and elsewhere have used bulging oil revenues of the last few years to placate their people. No place is this more true than Saudi Arabia, which has subsidized housing, health care, gasoline and a host of other things to the tune of hundreds of billions of dollars since the Arab Spring protests began in 2010.

As a result, Saudi Arabia now needs oil prices close to $100 a barrel just to balance its budget. If oil prices fall, it may have to cut social spending. In a country that's been a reliable oil exporter to the global market for over half a century, yet has both a restless segment clamoring for reform as well as extremists in the ranks, the repercussions could extend well beyond OPEC.

Saudi Arabia is in the middle of a public-spending boom—$400 billion through 2013 for infrastructure, and more than $100 billion for jobs, housing, bonuses and other programs.

On 2013, its finance minister, Ibrahim Al-Assaf, told Al Arabiya television that Arabia would tweak its spending plans if crude-oil prices were to drop below $80 a barrel. 2011, the kingdom needed about $60 a barrel to cover its spending.

 

[UnChosen]

The Saudi also needs to build up a reserve fund to diversify its economy when oil production drops, so they are in no position to waste any more money when its already wasting a lot on its religious adventures in the Middle East, on domestic subsidies, and on the ridiculous wealth of its nobility.

The Saudi had been threatening to increase oil output and slashing prices against other countries for years but always backtrack when reality strikes.

 

[Khalid Newazi]

Russia has gas too you know. Biggest gas and oil reserve. Russia can increase gas prices and it will put EU economies into inflation. Also Saudi Arabia alone can't meet global oil demands and Iran has sanctions too.

 

[UnChosen]

I will be really pissed if Saudi actually tries this suicide tactic because of US pressure.

It will kill off the Canadian economy faster than Russia's when our oil sand is already less economical to start with and we are already having a lot of problems persuading the natives to allow more pipelines and increasing oil production.

 

[mike2000]

Russians should fire a few kh-101 stealth cruise missiles on Saudi oil processing facilities,refineries and oil terminals.That will be enough to send Saudi Arabia into chaos as its population will rebel once the oil funds dry up and Al-Saud will fall.

ahahahahhaha............are you kidding?

and in return the saudi should get some of these nukes pakistan holding for them, wrap it around some so called lunatic suicide bombers and let it rip in moscow and other russian cities and call them terrorists. what world do you live in buddy these days bigger countries can get hurt harder than small one's.

Are you really erithrean bro?
I have been to Ethiopia, but not Erithrea yet. I admire Afwerki alot(well the past one, not present.lol)

 

[Arya Desa]

I will be really pissed if Saudi actually tries this suicide tactic because of US pressure.

It will kill off the Canadian economy faster than Russia's when our oil sand is already less economical to start with and we are already having a lot of problems persuading the natives to allow more pipelines and increasing oil production.

Anything below $80/barrel and it becomes more expensive to produce than it does to sell.

 

[Kabira]

Good news for oil importing countries.

 

[Chakram Indian]

That is good news for India thought. Cheap oil and that should also push down the price of PAK FA.

how will cheap oil push down the prices for pakfa ?