5 Reasons Why Saudi Arabia Is Driving Oil Prices Through the Floor

From Millie Dent writing at Business Insider:

1. Saudi Arabia is plotting against Iran.

Now that the sanctions against Iran have been lifted and Iranian oil can return to the world market, some people are wondering if Saudi Arabia is trying to sabotage Iran by holding down oil prices. Iran is poised to re-enter the global economy with a highly educated and young workforce and a strong manufacturing base and Saudi Arabia may be maneuvering to prevent Iran from reasserting itself and gaining more influence in the Middle East.

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2. The U.S. and Saudi Arabia are punishing Russia.

Both Saudi Arabia and the U.S. are at odds with Russia. Russia is supplying Syrian President Bashar al-Assad with billions in weaponry and military support, placing it in conflict with Saudi Arabia, which vehemently opposes Assad’s regime. Putin’s territorial moves in the Ukraine have angered the U.S. government, as well as leaders of the European Union.

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3. Obama is at war with the U.S. shale oil industry.

One theory suggests that President Obama is working with Saudi Arabia to flood the global oil market, killing the U.S. shale oil industry in the process. One of Obama’s key concerns is the environment and the shale oil boom could slow the development of renewable energy.

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4. Saudi Arabia has overthrown OPEC.

Every member of the cartel has indicated a willingness to meet and implement a unilateral OPEC production cut — except for Saudi Arabia.

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5. Saudi Arabia is at war with the U.S. shale oil industry.

Largely due to the boom in the shale industry, U.S. oil production increased sharply after 2011. Production surged to 8.7 million barrels a day in 2014 , up from 7.5 million barrels a day the year before, and has only kept growing since then.  The U.S. now pumps around 9.5 million barrels a day, or roughly 10 percent of the world’s oil supply, making it the third-largest producer in the world.

Read the rest of the story at Business Insider.