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Gold/Mining/Energy : Strictly: Drilling and oil-field services
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To: The Ox who wrote (69117)7/4/2000 11:25:23 AM
From: Fun-da-Mental#1  Read Replies (1) of 95453
 
Re Saudi extra output: here's another article with a bit different spin:

siliconinvestor.com

The first article said they are doing this in desperation to keep the price from going to $40. However this article says they will bring it down to $25 in short order, and that they are allied with the US, not OPEC.

I think this news may bring a pullback in the OSX short-term, although even $25 oil is fine for the drillers long-term.

As for the Saudis, I think they are probably caught in the middle between US and OPEC pressure and they're trying to reach a compromise. They are a small group of people fortunate to hold title to an enormous resource, and they're probably terrified it will be taken away from them at some point, either by the US or their OPEC neighbors.

I take this latest news as a sign that the US is not willing to let OPEC completely take control. I understand that the US still has a large number of troops stationed in Saudi Arabia. At the time of the Gulf War there were half a million. There are less now, but I think a large fraction are still there - somebody correct me if I'm wrong. At the same time there have been acts of terrorism in Saudi Arabia by groups which are sponsored by other OPEC countries. This latest news brings the US and OPEC a little closer to open conflict. JMHO

Fun-da-Mental
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