"In 2016, we are living in perhaps the first truly free oil market we have seen since the pioneering days of the industry"
OPEC is not a real cartel. A cartel controls an entire market, not a fragmented 40% of a market. Sovereign oil producers running colossal fiscal deficits while liquidating their sovereign wealth funds to pay the bills, are now ALL price takers, across the board. Welcome to free markets bitchez...
The *Free* trade era is ending with a big bang. The NeoCon Supply Side fantasy of a free lunch is ending amidst rampant poverty, out of control deflation, and the first non-normalized *recovery* in U.S. history. Debt is the new "GDP" for generation Madoff. Revisionist historians call all of this "Keynesianism". And if I was born yesterday or desperate to forget about "Voodoo economics", I would be saying the same thing, since all we hear about is how we're bailing out the gaping Titanic with more money printing and borrowing. Cyclical props used to mitigate the mass poverty caused by failed trade policy. Only when the free trade acolytes lose their fake wealth, will everyone be on the same page.
Where was I...The thought that OPEC would bankrupt the U.S. oil industry overnight, was a fantasy...Round 2 of the oil ground and pound will now begin. The oil industry will now demonstrate what happens in a real free market where everyone is a price taker and the price = marginal cost. Meaning the floor for oil will be in the teens or even the sub-10s level. No one can "compete" with global poverty, a lesson that is going to be learned the hard way.
