It's a moving target but the currency was down over 20% earlier today and 56% YTD. The collapse in oil prices coupled with tighter sanctions has led to a currency crisis that seems now to be self-fulfilling.
Last night the RCB raised rates from 10% to 17% but obviously that didn't help.
Putin certainly doesn't seem like the all powerful dictator people were making him out to be only a few months ago.
Is there anything the country can do at this point to prevent a total collapse of their economy and currency?
Bullshit. All is not well in the Gulf, but they're plenty happy to see the collapse of the Russian and Venezuelan economies in the short term because they're in it for the long term.
Too bad, start hocking missles and tanks.
They'll bounce back when the financial turmoil begets questions over Russia's economic and political stability.
Meanwhile everyone else is going full speed ahead at their own pumps.
Meanwhile everyone else is going full speed ahead at their own pumps.
There is still a point at which it ceases to become profitable, and if OPEC really decided it wanted to kill shale in its, umm, toddlerhood it would keep the prices consistently low long enough to run those companies under. But other countries, Russia for instance, don't have a medium and long-term outlook and so can't endure that. I think the more likely outcome is that the Gulf more or less accepts that demand has risen enough that a stable supply of moderately priced oil is in our interests and theirs, and that the Venezuelas and Russias of the world are problems for a variety of reasons.
And the decline in the ruble actually helps the Russian oil industry...
Full-scale currency collapse that could cause broad social upheaval and abandonment by the elites?
Not looking forward to his response.
I think Phil has nailed this. Oil is an engine that runs on consumer purchases, and those have been notoriously poor recently.
I do wonder whether low oil prices will create instability in the Middle East. Many of these countries have been using oil profits for large domestic spending programs that to some extent placate the population. There will be less money for that as oil revenue declines.
For now, the decline is operating as something like a $60B tax cut for Americans. I also think now is a good time to invest in oil. This is still the dominant fuel going forward.
I do wonder whether low oil prices will create instability in the Middle East. Many of these countries have been using oil profits for large domestic spending programs that to some extent placate the population. There will be less money for that as oil revenue declines.
For now, the decline is operating as something like a $60B tax cut for Americans. I also think now is a good time to invest in oil. This is still the dominant fuel going forward.
Right now you've got some serious challenges from Tesla and the electric cars, among other things, and that technology will presumably come down in price as it becomes scalable and waystations are developed. The last oil price spike created some behavioral changes too, changes likely to continue or even accelerate if it spikes again. The Gulf countries have smart people at the helm and substantial currency reserves, they know they are better off with moderately priced oil than with trying to extract the most they can in a 5-10 year period of high prices.
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There is still a point at which it ceases to become profitable, and if OPEC really decided it wanted to kill shale in its, umm, toddlerhood it would keep the prices consistently low long enough to run those companies under. But other countries, Russia for instance, don't have a medium and long-term outlook and so can't endure that. I think the more likely outcome is that the Gulf more or less accepts that demand has risen enough that a stable supply of moderately priced oil is in our interests and theirs, and that the Venezuelas and Russias of the world are problems for a variety of reasons.
Of course there's a point where it ceases to be profitable but that's probably at $40-50 per barrel. Far lower than where it currently is.
And the decline in the ruble actually helps the Russian oil industry...
There's an addendum to that question: what's the true price of oil absent the distortion of China's negative ROIC investment policies? This is the most important question for all commodities and all emerging markets.
The answer is much lower...
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The real question is what is the true price of oil absent the distortion of global QE?
And the decline in the ruble actually helps the Russian oil industry...
There's an addendum to that question: what's the true price of oil absent the distortion of China's negative ROIC investment policies? This is the most important question for all commodities and all emerging markets.
The answer is much lower...
Replace QE in my post with "central bank intervention" and the two thoughts merge:)
Bullshit. All is not well in the Gulf, but they're plenty happy to see the collapse of the Russian and Venezuelan economies in the short term because they're in it for the long term.
Don't forget Iran. In fact, the Iranians are suggesting that the Saudis are working with the US to keep oil prices low to strangle Iran.
Russia, Iran, Venezuela. Bankrupt them all.
It's a nice fuck you side effect, but Phil has been spot on. I'll follow his thoughts.
This seems more like a question than a fact.
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outside of shale states (TX, CO, WV, ND and PA), how many jobs have been created in the United States since January 2008?
This seems more like a question than a fact.
Once answered...douche?
Not Many? (Am I close?)
Headhunter has assured me that the labor market is robust!
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In comment 12037353 Rob in NYC said:
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outside of shale states (TX, CO, WV, ND and PA), how many jobs have been created in the United States since January 2008?
This seems more like a question than a fact.
Once answered...douche?
Oh, I'm going to do with the US losing 32K jobs then. Just a guess.
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outside of shale states (TX, CO, WV, ND and PA), how many jobs have been created in the United States since January 2008?
This seems more like a question than a fact.
Yeah, I don't follow that either.
Private Sector job growth has been positive in all states since the economy bottomed out in 2010. Some better than others. Tracking the same stat from 2008 - not sure what you're trying to prove. That overall, we're basically back at 2008 levels of employment excepting North Dakota?
Congress: Most Recent State by State Report - ( New Window )
I just assumed the question mark was a typo.
Comparing to pre-recession periods is the correct way to attack most of the problems...
I win! (BTW, you left out Oklahoma which is having an oil/gas boom as well)
Does any one have any stats as to how much of the job growth in the past 2 years have come from shale states?
Just a question, not a fact :)
Look at life expectancy, alcoholism rates, child malnutrition figures, and the rate of growth in height of the average Russian.
Russia, right now, is being doomed by a lot of demographic factors.
Look at life expectancy, alcoholism rates, child malnutrition figures, and the rate of growth in height of the average Russian.
Russia, right now, is being doomed by a lot of demographic factors.
Isn't something like half of the adult male population of Russia alcoholics?
I am not sure I see that...
The fact that significant technological innovations, or alternative activities, we're not being done en masse (I.ex, lots of movements towards alternative energies) hints that this is a weak, at best, hypothesis.