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Oil Prices 101

Blog by | January 15th, 2015

Oil Prices 101:

Prices are down because demand is down. Demand is down because the prices were too high for too long. Supply is up because of US shale oil and new oil production. Decreased demand, increase supply = low prices.

False conspiracy theories: Saudi Arabia is losing money keeping current production at $60 a barrel but taking 2 million barrels per day off the market will cost them more. Would you rather lose a whole lot or a little? The choice is simple...take the lesser of two evils.

FYI - Saudi Arabia did meet with Russia before the November OPEC meeting and proposed a production cut by everyone. Russia is the one who said no. Next OPEC meeting is in June.

You're not going to see oil prices go up before June = take your road trips now while you have cheap gas!

Final word of advice: never trust someone whose TV is bigger than their bookshelf.