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How Does the Saudi Math of the Oil Price War Work?

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    Jerry

    Doesn’t it cost money to produce a barrel? So since they are producing more oil wouldn’t they pay more to do it? Like it would cost them $5-10/BO to produce the oil. Probably doesn’t change your answer here, but would reduce the amount of income in the lower price scenario.Jor

    1. anasalhajji2017
      anasalhajji2017 Author

      This is an investment that is already based in the past. That is why they keep spare capacity.

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    hmed

    The math does not include physical premium and cost of freight (which isnt as significant now to Aramco).

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