OPEC, on a mission spearheaded by Iran and Venezuela, managed to cut production by 1.5 million barrels a day. Saudi Arabia actually refused to cut production and, in fact, is pushing for the reduction to be stopped. But despite their best efforts, oil prices continue to plummet. After Iran’s oil minister said (and I quote), “the era of cheap oil is finished,” oil stocks continued to drop today. They settled at less than $64 a barrel.
They’ll meet again in December to revisit the issue and decide whether they want to cut production even more, but as I said, Saudi Arabia is against the cut in production. I hate to sound like a broken record, but with the massive spike in prices over the last year, they gave us a taste of a life we have no desire to live. We’re not willing to give up everything else to be able to drive gas-guzzling SUV’s. Now the Iranian oil minister is all smiles, thinking they’re gonna get what they want after trying to proverbially slash our throats with the prices we were paying? He’s joking, right?
When gas hit $4.10 a gallon here in Phoenix, I read Bill Hennessey’s blog and he predicted a collapse. I told him not to tease me, but I agreed that with the pain induced by filling up our tanks oil prices could only drop or else people would just stop driving and cease the need for oil and gas. Prices are continuing to drop not nearly as much because of the financial crisis (the dollar is getting stronger, folks) as it is because they forced us to figure out ways to cut back on our need. Now that we know what they want, let’s drill and start studying chemistry like it’s going out of style.