What's a good investment vehicle for broader energy transition?
UAE to leave OPEC
291–300 of 750 posts
Re: UAE to leave OPEC
#292is there a vested interest for usa and our war partner ?
Re: UAE to leave OPEC
#293Earlier quoted context omitted.
Cheap and plentiful fossil fuels. We’re rolling back CAFE standards too.
CAFE standards were always a stupid idea. If we want to reduce fuel usage then increase the tax on fuel instead of punishing manufacturers for selling vehicles that consumers want to buy.
Vehicle emission and fuel efficiency standards are a great idea. The stupidity was allowing a "light truck" exception at all. It made the manufacturers turn to manufacturing and promoting what should be work vehicles to rich idiots who need nothing larger than a regular car (but can easily be upsold on something they don't need)
America is already fucked, given how awful its urban sprawl is. Trucks used for commuting and not haulage just makes it double fucked.
Re: UAE to leave OPEC
#294Earlier quoted context omitted.
>UAE announced this week they might start selling oil in yuan I have read this headline dozens of times in the previous 30 years.
I don’t think the gulf is in same as always mode right now
They kind of are. Iran has been attacking everyone in the Middle East for decades, occasionally seizing or destroying ships in Hormuz, and funding internal dissent. Things are worse right now, but not that much worse, and the short-term pain might very well be worth it for the long-term reduction in Iran's capabilities.
Re: UAE to leave OPEC
#295Earlier quoted context omitted.
It's a good question. Let me answer the question this way: OPEC is the biggest single factor for the inflation shock of 2020 to 2022 yet weirdly hardly anybody talks about it. Let's rewind to March 2020 and the start of the pandemic. For a very brief period, April oil futures went negative . Technically, this was an extreme contango market. Oil producers were running out of places to store oil and nobody was buying.…
OPEC doesn't adjust production. They set production targets, and then most of the members cheat. For geological reasons it's not even really possible to significantly reducing production on many oil wells without damaging them. Saudi Arabia generally has more freedom to throttle production up or down than other OPEC members.
It looks like for the May-June 2020 cuts, the rest of OPEC+ (excluding Russia and Saudi) accounted for 48% of the cuts. [0]
While I like the parent's provided information, I feel like the pandemic, fiscal stimulus, and wars were bigger drivers for inflation!
[0] https://www.reuters.com/article/business/healthcare-pharmace...
Re: UAE to leave OPEC
#296> The UAE's exit from OPEC represents a win for U.S. President Donald Trump, who in a 2018 address to the U.N. General Assembly accused the organisation of "ripping off the rest of the world" by inflating oil prices. I can't see how it is actually a win for Trump. OPEC has mostly been a big partner with the US. They are the ones that have mandated using the dollar as the baseline currency for buying and selling OPEC…
In fairness to the UAE, of all the nations of the world, they're the ones who have lost the most economically speaking in the current unpleasantness. It's kind of unfair. If they can recoup some of those losses selling outside the system in Chinese currency, (or even in US currency), I have to imagine that would provide some ameliorative relief. It won't make them whole. They've got a lot of problems right now. But I…
Of all the nations of the world, the one that has lost the most (at least in the short term) is clearly Iran.
On the other hand, from the longer term point of view, it looks like big part of the business model of UAE/Dubai (a safe, luxury place for rich) has been shattered and I don't see it coming back.
In the short term, they might want extra revenue, but in the long term, creating extra tensions with their neighbour can't be good.
Re: UAE to leave OPEC
#297Earlier quoted context omitted.
Everyone has a unique "..." and a nuance here and a nuance there. UAE has a unique yada yada and also ended up with a surprisingly remarkably free economic index despite being a theocratic monarchy. As did the monarchy Lichtenstein, British controlled Hong Kong, and the one-party state of Singapore (technically democratic, in practice it functions like a recallable monarchy). Also of note the three richest countries…
> one-party state of Singapore (technically democratic, in practice it functions like a recallable monarchy). This is untrue. It would be more accurate to say that the same party has been in power since independence from the UK. Each election in the last 30 years has slowly moved the needle -- fewer and fewer of seats held by the majority party (PAP). I guess there will be a non-PAP prime minister in the next 20 year…
I'll yield that it isn't a pure one party state. There is some room for difference of opinion whether you want to characterize it as one or not.
But let's not play the bullshit and borderline xenophobic, ad-hominem attack that it's just "outsiders" who "just don't understand." Or try and distinguish that it's people 'imposing their worldview' (something every human does no matter what they are arguing).
But don't take my word for it. Read what Lee Kuan Yew had to say himself[0]:
The PAP represents the broad middle ground in society and attracts the best and brightest people into Government, LKY said last night. He therefore did not see a two- or multi-party system emerging in Singapore soon.
This and other points, documented by Yeo Lay Hwee (Senior Fellow, Singapore Institute of International Affairs) , who even if she flip flops between suggesting Singapore is a one-party state, lists quite a few reasons why it is a reasoned viewpoint from an understood observer [1].
[0] https://eresources.nlb.gov.sg/newspapers/digitised/article/s...
Re: UAE to leave OPEC
#298OPEC has long been Saudi Arabia reducing output, and everyone else selling everything they can. They haven't had much power since the 1970s, but that they exist means they are a threat that if everyone else actually stuck to the agreement for a change. This is the common problem for cartels: everyone has inventive to cheat on the deals made. By selling a little more than your share you get more money, while because e…
Isn't the solution in game theory when there are multiple turns to just repeat the move the previous person made. So if the other side overpumped by x1 amount then you pump an extra x1 the next turn / year (maybe multiplied some reference production factor as they don't all have the same absolute limits).
Simple game theory doesn't work in the real world. In the short term most OPEC+ members other than Saudi Arabia have very limited technical ability to significantly increase or decrease production. It's not like they have a big valve that they can open or close at will. For many oil wells, restricting flow would actually damage the geologic substrate. And drilling new wells (including all of the supporting infrastructure) can take years.
Re: UAE to leave OPEC
#299This is how peak oil happens. Without a healty cartel, oil is doomed. Solar, wind, geothermal, hydro, nuclear. These are more than ripe to disrupt energy into the 21st century.
> Without a healty cartel, oil is doomed Why/how? Without a healthy cartel, wouldn't prices go down? Cheaper oil means less adoption of alternate energy sources.
The prices would go down too much, and then infrastructure would rot as production slows down. Then, prices would skyrocket, and so on.
Oil production and distribution is basically infrastructure, like energy or internet. It can't really follow free market dynamics without eating itself.
Re: UAE to leave OPEC
#300Earlier quoted context omitted.
Cheap and plentiful fossil fuels. We’re rolling back CAFE standards too.
CAFE standards were always a stupid idea. If we want to reduce fuel usage then increase the tax on fuel instead of punishing manufacturers for selling vehicles that consumers want to buy.
Increasing prices doesn't effect demand right? $10+ per pack cigarettes in California hasn't had any affect on smoking rates.