Saudi stocks slump as minister warns of ‘painful’ measures ahead
41–50 of 88 posts
Re: Saudi stocks slump as minister warns of ‘painful’ measures ahead
#42Looks like Saudi regime is in big trouble. They won't be able to balance their budget with oil prices so low and they won't be able to make payments to thousands of their princes. I did some searching and found few interesting data points: > For dozens of oil producers, the plunge in oil prices is devastating. No major oil producer can balance its budget at prices below $40; according to the International Monetary Fu…
Thousands of princes will go hungry. Even prince Mohamed "bone saw" might lose a few pounds. Bad news everywhere...
Re: Saudi stocks slump as minister warns of ‘painful’ measures ahead
#43Yes the oil industry is going to take years to recover from 2020.
And when it does there won't be much demand for it anyway imo
Re: Saudi stocks slump as minister warns of ‘painful’ measures ahead
#44The image caption used in this article, and in many similar pieces, is honestly somewhat scary: > Why Now Is the Time to Be Buying Big Oil Stocks This is dangerous advice given most investors, never mind casual investors, don't understand how the oil market works. Last I checked, there is no convenient way to invest in the spot price of oil eventually going up. People who buy "oil ETFs" like USO hoping to cash out if…
How is investing in oil majors or low-leveraged midstream a bad idea? Not only do many of these companies have a good balance sheet, but they're 4-6X undervalued if you're long on the investment. Furthermore, these companies are at price points where the dividend yield is 30-60%. You could put a percentage of your yearly salary in and retire on passive income when the market returns to normal. Having a passive income…
I don't follow, dividend yields on the 6 oil majors range from ~5-12% as far as I can tell. It's a far cry from 30-60%. Also many oil companies especially outside of the majors are notorious from having huge debt loads.
Re: Saudi stocks slump as minister warns of ‘painful’ measures ahead
#45Looks like Saudi regime is in big trouble. They won't be able to balance their budget with oil prices so low and they won't be able to make payments to thousands of their princes. I did some searching and found few interesting data points: > For dozens of oil producers, the plunge in oil prices is devastating. No major oil producer can balance its budget at prices below $40; according to the International Monetary Fu…
Can you explain what it means to balance the budget? Is it like break even price for the industary?
In countries like Saudi Arabia they fund their government budget via oil revenue.
Re: Saudi stocks slump as minister warns of ‘painful’ measures ahead
#46Looks like Saudi regime is in big trouble. They won't be able to balance their budget with oil prices so low and they won't be able to make payments to thousands of their princes. I did some searching and found few interesting data points: > For dozens of oil producers, the plunge in oil prices is devastating. No major oil producer can balance its budget at prices below $40; according to the International Monetary Fu…
>Probably a few wars too. Not sure how you're gonna fix this with wars given that every oil producer is underwater. Even if you capture someone else's oilfields...then what? Produce oil there at a loss too?
Modern wars aren't fought out of rational calculation that they'll improve the situation. They're fought when existing conflicts have their flames fanned just a bit too much, or when factors holding them in check suddenly change. I think the smart money is that oil prices will recover soon - but if they don't, we'll discover a whole world of conflicts which were previously suppressed by the reliable invariant of a rich Saudi government.
Re: Saudi stocks slump as minister warns of ‘painful’ measures ahead
#47Looks like Saudi regime is in big trouble. They won't be able to balance their budget with oil prices so low and they won't be able to make payments to thousands of their princes. I did some searching and found few interesting data points: > For dozens of oil producers, the plunge in oil prices is devastating. No major oil producer can balance its budget at prices below $40; according to the International Monetary Fu…
I'm an Iranian who moved to the U.S. only a few years ago. Something most people here in the U.S. don't understand is that countries like Iran have a far different threshold of pain. Iran, as a result of sanctions had already entered starvation-levels of economic collapse. There are people who are sleeping in open graves. Yet, the regime is not backing down in any way. It hasn't change course at all.
What does sleeping in an open grave mean?
While you were in Iran, were you involved in what the US called the Arab Spring? Was it really spread by Twitter? Did it seem like the regime might topple?
Re: Saudi stocks slump as minister warns of ‘painful’ measures ahead
#48Can the Saudi government survive a reduction in services? Their economy is largely built around the distribution of oil sale proceeds, I’m worried that cutting benefits might destabilize that regime.
Regimes like this often underestimate their own stability. There are tons of useless princes and government workers that are not really in a position to revolt if they get less money. Unless there is a serious rift in the top level elites, they can survive.
The history of Saudi Arabia is the history of factional infighting in the Said family. MBS is not yet King and his rise & rule have ruffled a lot of feathers.
That said, the system of keeping the royal family fat and happy with lavish stipends is entirely by design.
Re: Saudi stocks slump as minister warns of ‘painful’ measures ahead
#49Earlier quoted context omitted.
Well US troops are there to be a check on Iran, China and Russia. Terrorism is a rare side effect.
The presence of US troops in Saudi Arabia was a primary motivation for Bin Laden and 9/11.
This is nothing new, the US has been there since WW2.. Before that the UK. People forget history.
Re: Saudi stocks slump as minister warns of ‘painful’ measures ahead
#50Earlier quoted context omitted.
That's what the US troops are there for. The US needs the Saudi dictators to maintain their influence in the region.
Needed, past tense. US foreign policy used to be shaped around our need for Saudi oil, and IMO hasn’t properly adjusted to the fact that America is energy independent again. The realpolitik question now isn’t “how can I secure Saudi oil” But rather “what’s the least I can do to reduce any risk of terrorism”.
The Saudi’s have burned through generations of radicals by exporting them to other conflicts. Afghanistan, Balkans, Chechnya, Somalia, Indonesia, Libya, Iraq, Syria and Yemen.
With an ever increasing population and shrinking pot of gold, I’m thinking Syria Part II once the current regime in Washington DC is removed.
For neoliberals, like neocons, Terrorism is a feature - not a problem. Neither have had a seat at the table for the last 4 years, but they’re not going to let this opportunity go to waste.
And we’re going to pay for it.