paladisious wrote:Crusader wrote:The Saudis are forcing the price down to increase the pressure on the US domestic production of shale oil
This part is exactly what I heard from an Exxon exec in a conference I worked on, so I believe it, although it seems more likely that the motivation for it is purely commercial.
For about two years they have forced it to remain just below the production cost of US shale oil, lowering the price as US efficiency improved. The point is to prevent companies that cannot afford to maintain losses from entering the market and to ensure that it does not become a viable export.
Just as importantly it keeps the Iranian economy in recession which places internal pressure on the Mullahs who are forced to justify the costs of supporting Assad, Maliki, Hezbollah and the Houthis to an angry populace. The effect that this has upon Iran, Russia and Venezuela is why the US does not object to their erstwhile ally undermining their energy sector, it is a cost both nations are willing to bear in order to achieve strategic goals.
Oil is the Saudis major strategic weapon and they use it well.