Oil Prices Crash - Please Avoid Cartel Behaviour. It Does Not Work - Mukah Pages : Media Marketing Make Easy With 24/7 Auto-Post System. Find Out How It Was Done!

Malaysia recently cut our oil production by 15,000 barrels a day. This was a 'political decision' after consultation with the OPEC Arabs. This is why that Saudi foreign Minister dropped by for a quick visit.

The decision to cut our oil production was the only occasion where Azmin Ali the Minister of Economic Affairs made a Press Statement about an important economic matter in over seven months as the Minister of Economic Affairs.

Yesterday the oil price went down again.

Oil dropped 1% Tues, extending losses

big climb in U.S. inventories

record shale output stoked oversupply

Brent futures $58.95 per barrel down 66 cents, or 1.11%

West Texas Intermediate (WTI) down 40 cents at $49.48 per barrel

Both U.S. crude and Brent shed > 30% from early Oct

amid swelling global inventories

OPEC reducing production to rebalance

However, data still shows oversupply

production from 7 major U.S. shale basins to hit 8.03 million (bpd) for first time

we see prices will maintain low levels through 2019," said Sydney-based Frame.

Supply curbs by OPEC might not work

U.S. output increasing, Iran keeps pumping more oil

Russian output record-high of 11.42 million (bpd) in Dec

high suspicion if Russia will fill their commitment

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My comments :

High suspicion if Russia will fulfill their commitments to supply cuts?

US shale oil hits a record 8.03 million bpd?

Russian production hits a record 11.42 million bpd?

Iran (an OPEC member) is pumping like crazy?

I remember long ago in 1983 my economics professor explaining clearly why the infamous (and since then periodic) oil production cuts by the OPEC oil cartel eventually collapsed. After the 1973 Oil Crisis.

There is always cheating.

Plus new sources of supply pop up.

This is happening until today. Iran is pumping full steam.

Russia (non OPEC) has such a huge production. They are the new Saudi Arabia.

The king of the hill is US shale oil. Now at a fantastic 8 million bpd.

Oil is becoming a sunset industry. More importantly it has less opportunities for super profits. Oil will make normal profits - like any other business. Or losses.

My advice is avoid any cartel type of behaviour.

Let the financial managers decide if production should be increased or decreased based on cost and revenues.