OIL – THE COST OF EVERYTHING – ON GOING REPORT
So what IS going on OUT there?
Once upon a time boys and girls, there was a private club of oil producers. This club a long long time ago controlled about 2/3 of all the energy the world could ever use. For decades they priced the energy responsibility. Gasoline at the pump, in a world drowning in oil, where there is far more oil renewing, than the world needs, was priced artificially high but not too high.
The OPEC producers began to invest in developing their nations, and in defense and in wars, between themselves, like Iraq and Iran, and the result was they needed more money. They began to price oil irresponsibility.
The Opec all boys club, was seeing its MARKET SHARE move from 2/3’rds down to 1/3 of energy to the world. And the fall in MARKET SHARE was on going so by the year 2050 Opec and its all boys club would control less than 20% of all the energy. It was harder and harder for the all boys inside club to place a hidden tax upon the world, holding oil per barrel prices up as legal thieves to 140 dollars a barrel when the world is drowning in oil and gas.
Boys and GIRLS by the time we reached 2020 the OPEC nations had priced their budgets for their countries where they could not operate in the black – or break even – without oil priced at 70 dollars a barrel – which blocks most peoples of the earth from becoming self reliant and prosperous.
As oil suppliers owning the 2/3rds of oil by 2017 could produce enough oil that if Saudi the evil leader of the all boys inside oil club with the highest need to move out of red ink in their nation – now funding their annual budget by DEBT – elected to cut their customers in September of 2017 off of any supply from them – as the OPEC leader by 10% further to cuts they already made.
This plan by Saudi the evil leader of the all boys inside club trying to maintain a hidden tax on the cost of everything to all the people’s of the world – so they themselves could prosper as the few against the many economics – by a CARETL ILLEGAL PRICE MONOPLY in energy the core asset – conducted a desperate last ditch summer 2017 ploy – to cut their best customers off by 10% what DO YOU THINK HAPPENED BOYS AND GIRLS?
Yes Alice you had your hand shoot up?
Thats RIGHT ALICE.
Nature abhors a vacuum.
Yes that is also true.
So your both right children.
The summer market is the peak drive market of the world. Use of Gasoline was down from a year ago world wide ( again ) and summer stocks in the peak vacation month of August rose in the USA for Gasoline while crude stocks went down during peak season all predictable.
Oil largely due to North Korea “fear factor” went up a bit in August during the peak Fear Week between the USA and North Korea ( a passing energy to oil prices not a real event ) during annual American South Korea stepped up – regular war games against North Korea. We are so ready to make fused glass of a tiny nation. If you kick a super power enough times under the table eventually that doggie WILL MOVE folks. Super Powers are their name because why?
Yes. The Super Power kicked enough times will use it’s super powers and has used them in the past. Bam.
So President Donald Trump understands that FAT BOY in North Korea the cult dictator of his cult criminal drug dealing nation – does not understand diplomatic talk. So Donald Trump now speaks FAT BOY so he can understand in his own language the consequence of crossing a new Presidents Red Line. The consequence will be a power hour of NO MORE North Korea. Hopefully the grown ups in their intelligence and military understand “overwhelming” SUPER POWER ” against cap gun forces? The answer is one and their done or they and millions are done. DO THE MATH children. We think North Korea Will.
Now back to oil and the all boys Opec Club with its market share and global influence to illegally steal from nations of the world – as their market share plunges from 66.33% to under 1/3 % in a single generation of insane oil market mistakes.
Yes that is right too. For 25 years the world has been in a MARKET SHARE WAR and Saudi has allowed the OPEC members to lose more market share – more customers – more buyers – FOREVER than any group economically has ever self destroyed in 10,000 years of human history. Why?
That is right children. The change in markets was so fast that the OPEC community in its arrogance and ignorance developed POLICIES ( always the worst choice and always the common choice ) of THAT IS THE WAY WE HAVE ALWAYS DONE IT.
My new book Children – HOW TO PROSPER IN SUPER CHANGE – defines we live in the new AGE OF SUPER CHANGE. The new capital is CURRENCY. Leaders who have capacity to more rapidly learn, in Super Change, to unlearn in Super Change and to RELEARN in Super Change. This is the new qualify definition of the new educated. Not a brain educated by Harvard or by Stanford. No children. Super Change Brains will populate tomorrow C suite using the failed OPEC and Failed Saudi old brains as an example of loosing economies – losing trillions of dollars of market share, and doing all those loses to yourself.
So OPEC minority nations having lost so much market share by 2017 were now totally desperate. They have no way to finance their growing debts and they are sinking into distressed economics. To off set this their only option is to see oil prices soar for their remaining dwindling market share as demand is falling – demand peaked – and new supplies are discovered all over the world.
Opec has failed with its failed team of obsolete policy makers boys and girls as they adopted a policy in 2016 and 2017 from very silly inside brains – in the middle of SUPER CHANGE – where they paid billions upon billions upon billions of their precious economics and dollars – to lose customers to the oil winners controlling 2/3 rds of the world market and soon 80% of the world markets.
Insiders to the failed policy in OPEC see what you children have reported in our lesson today. They see the insanity of paying to give market share away. So they are cheating. They are simply not paying attention to an OPEC that is an old boy hand shake with no enforcement or real monitoring possible at all. They attend Royal Meals and enjoy lavish grand discussions of failed idiotic theories about oil cartels and monopoly world price fixing which in hindsight they see as darn silly really. Today the world is in global TRADE WAR with every nation for themselves. Trust and Cooperation broke down in 2007 and has never returned from abuse of the system and financial crashes that took place world wide. Shocking the old model into SUPER CHANGE going on now.
Today all the capital is consolidating to software trading using what we call AI that is stage one program improvements in Super Change Markets. Real Artificial intelligence of self aware new species being created today will follow and further consolidate capital. The result can become the largest world economic melt down and loss of circulation in human history taking place in an hour or a day versus weeks and months in the past. Too fast for lines at banks. Total melt down from software itself.
But children that is another story for another day as that fairy tail is being written by nations as we read the OIL PATCH fairy tale.
So once upon a time there was a small club of boys who tried to make trillions by taxing the world for energy when they lost control of the market share.
Then the boys trying to raise the price on the entire world, took supply desperately relied upon by nations for their peoples, away from their best most loyal customers. What do you believe happened when Opec did that in September 2017 children?
Ah you children have got this. Your both right.
Yes the math works for you. The oil rising supplies rising and soaring in output from the NOT IN THE OLD BOY OPEC TINY CLUB of producers – rushed in and supplied the 10% that OPEC took out of the market.
Ben is right too that the Summer Peak use market falls off in the fall and the stock supplies of oil rise again and the price Opec thought would stay about 50.00 dollars a barrel – fell again. Only as MARKET SHARE for OPEC plunged forever as they now paid double to loose these customers another event happened.
Why your like Alice in Wonderland Alice your so right.
The nations cut back by 10% from OPEC old boys to just artificially jack up their bills and price – rushed to move most of their business finally and forever from OPEC. The OPEC market share wars were lost a long long time ago as you have seen in my chart children.
But in 2017 OPEC made 2018 the biggest loss of OPEC MARKET SHARE in their entire history EVER. You got that ALICE.
The customers watching the TUG OF WAR – OPEC cuts supplies and raises prices – the rest of the world rushes in and over fills the supply and lowers the price. This TUG OF WAR market share war has gone on a long time now. Opec has lost this war so badly that very soon the price of oil will plunge down into the 30.00 dollar range as OPEC members opt to be OUT OF OPEC which is their economic choice to PRESERVE AND PROTECT MARKET SHARE in the oil supply patch.
PRESERVE AND PROTECT MARKET SHARE at any and all costs is the only economic sanity in the market driven by demand and supply. OPEC seeking to return to the 1970’s is a bit insane speaking economically. The advice the members of OPEC should have gotten if you children could advise them in 2010 is what children?
All hands up up. Ok all of you shout it out?
THAT IS RIGHT – LEAVE OPEC – you children have got this.
Opec is a train wreck.
A few bankrupt nations who fail to cut back their outflow of expenses to match their adjusted inflow of income – thinking Newton was wrong and income would go up and Up and UP and UP UP and never come down – defies gravity in economics. All events start and stop. All events go up and go down.
No event continues to go up forever. None.
You children on this?
( All hands go up and heads nod )
So if you children ADVISED OPEC versus the billion dollars they have spent with idiots costing OPEC trillions – you could have done a better job?
Yes children in my opinion as past chairman of a global, publicly traded, large investment banking firm like Smith Barney, with thousands of brokers and analysts and experts – and as an economist myself I agree with YOU children. I think you are giving OPEC better advice than all their advisers world wide combined together.
Desperate boys often use war as their final card. So we worry more about Saudi going to war with Iran or other wars in the oil patch to artificially tax the price up for the world, because why Children?
Yes your right. OPEC is not focused on obsession as to what they can do more to assist and serve their customers. They are obsessed with how they can illegally steal maximum tax on all peoples of the world for their own greed need. They don’t care how many nations they hurt in doing so and they don’t care if they kill a lot of their own in a preventable war to do so. They just want the higher price.
Their last card is war.
We have predicted as they run out of all other options they will go to war? Why?
Yes Alice . Oh you again . You see in the LOOKING GLASS and ten you get it.
If rulers like a small Royal Family see the economics of their nation sink and sink and fall – into ever larger failure economics – and red ink – then the people the many will rise up against the few. The rule of the few against the many will end and the start of the rule of many for the many will rise. To protect themselves from death and destruction they would go to WAR first and kill many of the many for the preservation of power and wealth for the few.
Alice you saw the future in the looking class.
Now you children all know what?
( they all scream it laughing )
IT IS ALL JUST ECONOMICS ….FOLLOW THE MONEY.
Well I think you all deserve a lunch break now and a recess to have some play. You are my economist of tomorrow children.
Each and everyone one.
The OPEC Fairy tale is over for today – THE END.
Berny Dohrmann – NOW RUN AND PLAY IN THE OIL PATCH