Climate Strutting

The climate agreement between China and the United States might amount to something.  It's certainly a good way to tick off Republicans.  But Patrick Smith suspects that President Obama needed to show some kind of success at the summit.  This agreement helped overshadow the news of Chinese-Russian energy contracts--in the face of U.S. efforts to tank the Russian economy by getting the Saudis to increase oil production and lower prices.  Smith sees a lack of vision on the part of the U.S. regarding the decline of American dominance.

We can start to connect the stars . . . and identify the costs of a consistent pattern of destructive behavior on Washington’s part . . . [but being] [n]ostalgic for the period of primacy known as the American Century, the U.S. cannot accept its passing.

Update (November 28):  I suppose many factors are behind the drop in oil prices.  A Russian oil executive says the OPEC decision to maintain production in the face of dropping prices is an effort to drive American shale oil producers out of business.

Update (December 1):  This discussion suggests the Saudis may be trying to hurt both Russian and American producers--anyone with high marginal costs.

Update (December 4):  Russia is in a recession and more about the impact of falling oil prices.

Update (December 6):  The fracking boom may be coming to an end.

Update (December 13):  An Australian shale drilling company has gone bankrupt.

Update (December 15):  Winners and losers in the oil price drop.

Update (December 17):  The Russian ruble is crashing.

Update (December 18):  Apparently the ruble is stabilizing, but the Russian economy is heading for a recession.

Update (December 21):  Richard Heinberg gives his take--that demand is softening and low prices for oil should not be mistaken for resource abundance.

Update (December 31):  Dan Steffens speculates that Saudi Arabia may be putting pressure on Iran to end their nuclear enrichment program.  But eventually, low oil prices will hurt us all if it leads to supply shortages.  Also, Tom Whipple reminds us that peak oil hasn't gone away.

Update (January 10, 2015):  Robert James Parsons seems to suggest the China-U.S. climate agreement is essentially smoke and mirrors.

Update (January 11, 2015):  More speculation about why oil prices are dropping.

Update (January 28, 2015):  India and the United States also have a climate agreement.

Update (February 3, 2015):  Amid fracking industry layoffs due to falling oil prices, workers represented by the United Steelworkers Union have gone on strike.

Update (February 8, 2015):  The strike expands.

Update (February 9, 2015):  Michael Klare examines the prospects for continued low oil prices.

Update (September 12, 2015):  Fracking production is going down and it seems OPEC is succeeding in driving those producers toward bankruptcy.

Update (September 27, 2015):  More on the "fracking bubble".

Update (December 21, 2015):  Crude oil prices reach an eleven year low.

Update (December 30, 2015):  Maybe the Saudi strategy of trying to drive out high-cost oil producers isn't working so well.

Update (January 3, 2016):  From the podcast On Point, a discussion about oil prices. A new idea for me is the thought that if the Saudi's think oil might not be worth much in the future due to the need to move away from fossil fuels, then they have an incentive to produce as much oil as they can now for whatever price they can get. That's not to say there still aren't other motivations. I'm wondering if pushing other producers out of the market makes the development of alternatives even more urgent.

Update (January 16, 2016):  Michael Klare agrees that the Saudis are trying to drive unconventional oil producers out of the market and yet U.S. production is 9.2 million barrels per day--higher than a year ago. Klare describes the notion of peak demand for oil as the world shifts to renewable sources of energy. He expects the decline of oil to be accompanied by political turmoil.

Update (January 20, 2016):  David Dayen and Gail Tverberg examine the impact of collapsing oil prices.

Update (March 5, 2016):  Ben Walsh cites James Rowe re-enforcing the idea that the Saudis are selling what they can to avoid ending up with "stranded assets".

Update (March 9, 2016):  More from Michael Klare about the declining oil industry.

Update (September 15, 2016):  Angelo Young reports that at least 58 U.S. oil companies have gone bankrupt this year.

Update (September 28, 2016):  Looks like Saudi Arabia is changing course and plans to cut oil production to try to raise prices.

The decision at this week’s meeting of the Organization of Petroleum Exporting Countries in Algiers to cut production was necessitated by Saudi Arabia’s tattered finances. The kingdom has the highest budget deficit among the world’s 20 biggest economies, it’s enduring a delay in its first international bond issue and now faces fresh legal uncertainty as the U.S. Congress voted Wednesday to allow Americans to sue the country for its involvement in 9/11.

Update (July 1, 2018):  Looks like Dear Leader thought he had an easy deal with Saudi Arabia to increase oil production by as much as 2 million barrels per day because "Prices to (sic) high!" But

A White House statement said instead that while King Salman bin Abdulaziz confirmed his country has the extra production capacity, the Saudis will “prudently” use it “if and when necessary to ensure market balance and stability, and in coordination with its producer partners, to respond to any eventuality.”