Isn’t Russia The Enemy?

Isn’t Russia The Enemy?

Not only is Russia hosting “the beautiful game” the 2018 FIFA World Cup, but while Saudi Arabia’s football team is on the field the titans of the oil world are discussing how they will dominant global oil markets, including the pricing mechanism.

Russia and Saudi Arabia have de facto accepted responsibility for the stability of the global oil market by working out an agreement which may pave the way for a new global oil market and oil price regulation mechanisms, Russian analyst Dmitry Lekuh said. Source

If you control both the price and the majority flow of any product you have complete control of that market. Oil is the most used commodity on the planet and it could be argued the most important strategic asset to any nation. If you are Russia, and dominant oil production, then you are in fact a key nation in any and all discussions where global trade is concerned. Let the flow of Russian oil dry up and let’s see what happens.

He noted that Russia and Saudi Arabia intend to offer other oil producing countries — including Canada, Mexico, Kazakhstan and the US – the opportunity to join the global oil production curbing agreement.

“Of course, no one is going to force them to join. It’s worth mentioning, though, that the combined oil production capacity of Riyadh and Moscow is enough to regulate the global markets purely for the sake of their own interests and not just for everyone’s benefit,” Lekuh remarked, adding that “under certain circumstances” oil prices can fall just as well as they can rise. Source

It could also be argued the oil market, since it is probably the second most important global market being second only to the US Bond market, is one the most heavily manipulated global markets. The “paper oil” contracts that fly around pushing the price of oil in one direction or another is a serious problem for the people at ground zero and the people that are actually dealing in oil based products. If you must have oil, the price can become secondary. This fact is not lost on Russia and Saudi Arabia as they are reaching out to non-OPEC oil producing nations like Canada, Mexico, Kazakhstan and the US to offer these nations an opportunity to join the global oil production curbing agreement. Sounds like more manipulation, just not on the price but on the flow of oil as well.

“Of course, no one is going to force them to join. It’s worth mentioning, though, that the combined oil production capacity of Riyadh and Moscow is enough to regulate the global markets purely for the sake of their own interests and not just for everyone’s benefit,” Lekuh remarked, adding that “under certain circumstances” oil prices can fall just as well as they can rise.

As he explained, this extension may allow this “powerful organization with a more formalized coordination center” to manipulate the market more efficiently and to affect both oil and natural gas prices. Source

It sounds like this rhetoric is aimed squarely at Wall Street and The City of London which are both well known for market rigging, price manipulation and, in general, making up the rules as they go. If you have the largest oil producing nations in agreement that something has to change, there is a good chance things will change.

I find it interesting that Russia, the sworn enemy of the U.S., is meeting with one of the strongest ally’s of the U.S., Saudi Arabia, to discuss the production and flow of one of the most important, if not the single most important, strategic assets on the planet.

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The Daily Coin

Rory Hall, The Daily Coin. Beginning in 1987 Rory has written over 1,000 articles and produced more than 300 videos on topics ranging from the precious metals market, economic and monetary policies, preparedness as well as geopolitical events. His articles have been published by Zerohedge, SHTFPlan, Sprott Money, GoldSilver, Silver Doctors, SGTReport, and a great many more. Rory was a producer and daily contributor at SGTReport between 2012 and 2014. He has interviewed experts such as Dr. Paul Craig Roberts, Dr. Marc Faber, Eric Sprott, Gerald Celente and Peter Schiff, to name but a few. Don't forget to visit The Daily Coin and Shadow of Truth YouTube channels to enjoy original videos and some of the best economic, precious metals, geopolitical and preparedness news from around the world.