Quote:
Originally Posted by Locke
Well, on the surface that could be correct, but realistically what is the benefit in flooding the market that has surplus supply already at a ridiculously low price?
Sure, its dollars coming in the door, but are those dollars profit? If the price is low it makes more sense to hold back and wait until it comes up so you can maximize the benefit of your resource.
Its the same mistake the Saudis are making. "Flood the market and gain marketshare!!!"
Great. Lots of people are buying what you're selling, just at rock-bottom prices. So you're selling lots of stuff, just not making much while you're at it.
Congratulations?
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I don't think Iran is making a mistake.
http://www.bloomberg.com/news/articl...ojects-in-play
As for choosing to keep barrels in the ground: if you know what the price of oil is going to be in the future so you can compare to today and decide what's worth more to you, then you might as well skip producing and just play in the futures markets.