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In the “Oil War”, Washington Blinks First to Survive

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The “oil war” started by the Saudis (and the US) has, within a matter of weeks, already led to a change in the narrative from purportedly establishing ‘shale oil dominance’ to ‘energy market management’ and avert a crisis that could ultimately destroy the very shale oil industry of the US. This resulted in the US president holding a phone conversation with Russia’s Putin aimed at discussing ways and means of ‘better managing’ the on-going crisis. The “oil war” that was triggered by Saudi Arabia’s refusal to continue and extend the previously agreed OPEC formula, which was instrumental for maintaining stable oil prices for years, has already led to the oil prices plummeting massively, going down to record lows of the last two decades. For the US, the oil war, whereas its initial purpose was to force an unwanted change on Russia and reduce its oil production to give way to an increase in the share of US shale oil on the global markets, could now potentially destroy over half of its shale oil industry, disrupting the very base of the US ‘super-power’ status.

Earlier in October 2019, Trump told US shale producers that the purpose of expanding the oil industry was not just to reduce and end dependence on oil supplies from “foreigners”, but to establish “American........

© New Eastern Outlook