Saudi Arabia is caught between a rock and a hard place when it comes to oil markets. The decline in oil prices from over a hundred dollars a barrel to the eighties is costing it a lot of money. But cutting the amount of oil produced and sold, in an effort to raise prices -- the role the Saudis traditionally have played -- has the short term effect of cutting income even more. Before you weep tears of sympathy for the desert oligarchs, keep in mind that the Saudis have about a year’s worth of income held as reserves, so they can withstand a temporary income decline. But the share of world oil output accounted for by OPEC and the Saudis is in decline, thanks in large part to the fracking revolution pioneered by the infidel scientists in Houston and elsewhere. This means that there is a declining ability to manage prices by cutting or raising production. Yesterday it was revealed by an anonymous source that the Saudis cut the amount of oil they supplied to markets in...(Read Full Post)