Economy 52,837 Posted August 7, 2015 Share Posted August 7, 2015 http://www.telegraph.co.uk/finance/oilprices/11768136/Saudi-Arabia-may-go-broke-before-the-US-oil-industry-buckles.html Saudi Arabia citizens pay no income tax and business taxes are almost non-existance. 90% of Government revenue comes from oil. Oil Prices just fell today to $44/barrel. At the current rate of over-spending, Saudi Arabia will have exhausted its cash reserves in 2 years. Despite oil prices atm being almost 1/3 of what they were at peak of last year ($115/barrel) the glut is not disapearing... This past week stockpiles of refined products rose yet again and storage hubs of oil remain very close to full To make matters worse, private companies have fought hard to bring down production costs to adapt to lower prices by increasing efficiency and improving extraction technology. US Shale costs for instance have dropped to $55/barrel and may fall to $45/barrel by next year With private companies WW adjusting to lower prices so they can keep pumping, the daily oversupply will not go away anytime soon and a major price rebound seems unlikely anytime soon Link to post Share on other sites More sharing options...
Yves 1,891 Posted August 7, 2015 Share Posted August 7, 2015 No Income tax? Business taxes are non-existent? - Oil is a non-renewable resource. They took it for granted. Link to post Share on other sites More sharing options...
wiltedbliss 915 Posted August 7, 2015 Share Posted August 7, 2015 Hopefully it's ****ed up government can go with it. Link to post Share on other sites More sharing options...
Economy 52,837 Posted August 7, 2015 Author Share Posted August 7, 2015 No Income tax? Business taxes are non-existent? - Oil is a non-renewable resource. They took it for granted. well they still have so much for so long that if they kept building up their savings in the future in 50 years lets say they could totally have invested in another economy when the time came i guess they didnt expect the tight oil supply situation and high prices to last only 1 decade. Everyone thought it would only get worse... no one expected the rate of demand growth to slow so quickly (demand rising no more than 1.5% per year now) and for unconventional oil reserves to become extractable on such a mass scale with our new technologies... 10 years ago few took non-liquid oil seriously... Everyone thought oil sands and shale from rock would always be produced in small amounts, but the technology advanced far more than those pessimists would have expected Link to post Share on other sites More sharing options...
Raikou 1,169 Posted August 7, 2015 Share Posted August 7, 2015 Is there too much oil? Link to post Share on other sites More sharing options...
The Professor 1,060 Posted August 7, 2015 Share Posted August 7, 2015 hmmmm, should've diversified your economy Link to post Share on other sites More sharing options...
Economy 52,837 Posted August 7, 2015 Author Share Posted August 7, 2015 Is there too much oil? yes. The world is currently producing about 3 million barrels (94.5 million gallons) more oil than it is consuming Many storage hubs where oil is stored are getting full, in some areas they have resorted to filling up tankers with oil to use as extra storage space They thought the low oil prices would correct the situation by encouraging more demand, and reducing production... but because of slowing China and still weak global economy, demand is rising very slowly... at the same time companies are adapting to lower prices with more efficiency so for the moment production wont reduce Link to post Share on other sites More sharing options...
Economy 52,837 Posted August 7, 2015 Author Share Posted August 7, 2015 hmmmm, should've diversified your economy its what happens when u put all eggs in 1 basquet lol Link to post Share on other sites More sharing options...
HANZ 4,380 Posted August 7, 2015 Share Posted August 7, 2015 I'm glad My Favs = Lady Gaga, Janet Jackson, Ricky Martin, AKB48 Link to post Share on other sites More sharing options...
Economy 52,837 Posted August 7, 2015 Author Share Posted August 7, 2015 I'm gladthey have a pretty large population that will suffer... ur glad?????????? Link to post Share on other sites More sharing options...
Jjang 2,262 Posted August 7, 2015 Share Posted August 7, 2015 Saudi Arabia is ruled by a self - serving monarchy. The vast majority of the lives there are in a bad financial state, dictatorship is to blame really - idiotic, vile leaders. People tend to believe that Saudi is financially stable because it contains a significant amount of the richest people in the world and figures of high class, but that's surely not the case.Anyway, as sad as it may sound, this was predicted to happen sooner or later. Some would argue the same about the United Arab Emirates but Dubai capitalized on tourism and attracting tourists (where Saudi Arabia relies on selling their oil and resources) , as a matter of fact it aims to triple it's income by 2020. Very smart. Link to post Share on other sites More sharing options...
Economy 52,837 Posted August 7, 2015 Author Share Posted August 7, 2015 Saudi Arabia is ruled by a self - serving monarchy. The vast majority of the lives there are in a bad financial state, dictatorship is to blame really - idiotic, vile leaders. People tend to believe that Saudi is stable financially because it contains a significant amount of the richest people in the world and figures of high class, but that's surely not the case. Anyway, as sad as it may sound, this was predicted to happen sooner or later. Some would argue the same about United Arab Emirates but Dubai capitalized on tourism and attracting tourists, as a matter of fact it aims to triple it's income by 2020. Very smart. i dont know about that... even optimists didnt expect unconventional reserves to become as big a thing and to flood the oil market as much as it has and what ur saying isnt quite true, people there dont live in poverty... in fact their population has started growing quickly past several years because people are having way more children because they can now afford it... theres places that sell gold everywhere, everyone has their car, theres AC like everywhere (thats why in the hottest season their electricity consumption surges) and the cities are very vibrant Their fast growing oil consumption is another indicator... true they use a lot of oil for everything but consumption wouldnt be growing unless their economy was too... often their GDP growth is of over 4% per year. I dont know where your getting the idea that the average person there doesnt live well. True it stinks to be a woman there but that has nothing to do with economy Link to post Share on other sites More sharing options...
Jjang 2,262 Posted August 7, 2015 Share Posted August 7, 2015 i dont know about that... even optimists didnt expect unconventional reserves to become as big a thing and to flood the oil market as much as it has and what ur saying isnt quite true, people there dont live in poverty... in fact their population has started growing quickly past several years because people are having way more children because they can now afford it... theres places that sell gold everywhere, everyone has their car, theres AC like everywhere and the cities are very vibrant I dont know where your getting the idea that the average person there doesnt live well. True it stinks to be a woman there but that has nothing to do with economy I exaggerated to make a point and I apologize for my non - accurate claims. I was just trying to emphasize on the fact that there's a huge gap in society there between poverty and high class. Also bare in mind that statistics are showing great signs of rise in poverty. It's only mind bending because it's a rich nation with a significant amount of poor people. Unemployment and booming population drive growing poverty. Basically what I was trying to say ; It's not the golden, rich country everyone thinks it is. (citizens wise). Just wait till it runs out of its' resources. Link to post Share on other sites More sharing options...
Economy 52,837 Posted August 7, 2015 Author Share Posted August 7, 2015 I exaggerated to make a point and I apologize for my non - accurate claims. I was just trying to emphasize on the fact that there's a huge gap in society there between poverty and high class. Also bare in mind that statistics are showing great signs of rise in poverty. It's only mind bending because it's a rich nation with a significant amount of poor people. Unemployment and booming population drive growing poverty. Basically what I was trying to say ; It's not the golden, rich country everyone thinks it is. (citizens wise).im sure theres plenty of poverty... many "rich countries" have surprisingly high levels of poverty... but u kind of made it sound like everyone besides the top wealthy were living like slums... not the case. The number of people that live well is quite high there... and i know not just from statistics but also from people who i know that lioved there My neighbour didnt like living there because as a woman she said she had few rights... but economically life for most people was easier than here in Canada. Unless your unemployed there, you dont get taxed, you keep everything, and the Government does pay for quite a few services Also what you said about growing population and poverty is actually a myth... During times of rapid population growth is when you have the most active economies and lots of business investment... I can give you a 2 page long explanation of why people got it all wrong when they think more retired people or shrinking population leads to more job opportunities but i can assure u its quite the opposite. There historical data and life examples that even prove it. if u really wanna know PM me and ill gladly explain The only exeption is in really poor lands where people cannot feed their families... in such cases, more children leads to even mroe poverty. but that occurs more so in unindustrialized 3rd world nations as that person likely wont get a producing job. Link to post Share on other sites More sharing options...
Woolfsmck 2,763 Posted August 7, 2015 Share Posted August 7, 2015 but because of slowing China and still weak global economy, demand is rising very slowly... at the same time companies are adapting to lower prices with more efficiency so for the moment production wont reduce Don't forget that many EU countries and the U.S. are paring their growth with renewable energy. Demand for oil goes up with population increase, but new fuel efficiency standards and governments adding incentives to reduce energy are slowing the demand down too. like a cat in a sil, I observe life, moving and still. My words give a clue,look inside to see whats true Link to post Share on other sites More sharing options...
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