Saudi may depeg their currency from the Dollar

[xandman]

The BBG article quotes BofA's Head of Commodities and Derivatives Research.

I don't quite understand how a supply cut would raise Saudi revenues. They are just dumping ahead of the Iranians.

imho: If a depeg happens, Oil could be at these lows for a very long time.


http://www.bloomberg.com/news/artic...or-drop-riyal-peg-saudis-face-critical-choice

 

[eurusdzn]

Worldwide pressure not to raise rates wil probably continue to increase before the December FOMC. meeting. Dont think fed wants to hear oil will be higher with USD if they raise rates. Guess everyone will do whatever it takes.
Another reason to lean against a December hike.

 

[zdreg]

more likely an extended world wide depression would keep prices low in real terms. i.e. inflationary depression.

 

[smallStops]

One ET fellow came across some reports that Saoudi Arabia will run out of cash within 5 years. So may be this is the unfolding of this coming scenario!
Thank you for keeping us posted.

 

[Bry]

Zerohedge said if they do it, it will be a black swan event shock to the markets.

 

[xandman]

Zerohedge said if they do it, it will be a black swan event shock to the markets.

Worthy of a link. Thank You.

http://www.zerohedge.com/news/2015-...t-signals-loudest-black-swan-warning-13-years

Well, it's a grey swan now. I see no strong argument for a Saudi production cut. Much easier to foment social unrest in the Middle East. Not making an accusation, just a contraposition...I think.

Also according to the CME, NG can produce twice the energy (in BTUs) with half the cost. We have major LNG export facilities coming online. They are selling with both hands.