Saudi Arabia refuses to bow to pressure to cut oil production

Saudi Arabia refuses to bow to pressure to cut oil production



Here is a very good article about why we cannot be overly optimistic about a turn-around in oil prices.  Nobody knows for sure what the Saudis will do.  When some OPEC members talk about $80 per barrel being a fair price for oil, this does not mean Saudi Arabia will accommodate by reducing production.



So, we don't really have a long trade in oil yet, and it might not happen until next year.  As the article mentioned, the Saudis are really hurting themselves as much as others by reduced income from oil.  They would be better off just giving up some of their business at a higher oil price.  In the meantime, whenever oil dips below $40 per barrel, there might be an optimistic bounce from that level to $48, and a nimble trader might get a quick 20% profit if he acts fast.