Former Saudi Oil Minister Confirms To Bloomber What I Said About The OPEC Deal...#MirMak

Former Saudi Oil Minister Confirms To Bloomberg What I Said About The OPEC Deal...#MirMak

 

 

Former Saudi Oil Minister confirmed yesterday what i wrote in my article 10 days ago on November 30th that "OPEC Members Cheat" and this production reduction of 1.3 million barrels a day will have no affect in the future control of the oversupply glut.

Bloomberg further calculated on their own and came to a result that this OPEC deal will not reduce oversupply in 2017. The Bloomberg article of yesterday titled "OPEC's Historic Deal Won't Be Able To Drain Oil Stockpiles" describes in details what i had already written in my article that the inventories are too high to be controlled by a mere cut of 1.2 million barrels a day and the second point i had brought was that the non-OPEC countries are under no compulsion to agree to a cut in production rather they would find this opportunity to cheat and flood the markets in high seas.

This oil oversupply needs to be addressed as many countries including the GCC economies will no longer be able to bear the pressure for another 12 months and may collapse in totality because they were absolutely dependent on oil revenues to support the welfare based system for their local population. UAE will also begin to feel the brunt of this entire oil debacle because it is very much connected to the economy and support of Abu Dhabi and Abu Dhabi is an absolute oil based economy. Dubai so far had been insulated from an "Immediate" collapse because it had some service based and a lot of tourism based revenues coming in but Dubai with its habit of over doing everything, has almost killed its own tourism industry by building more hotels than needed. An absolute over supply of new hotels and the existing ones barely surviving has brought the hotel rents in Dubai to a historic low, never seen since 2005. Most of these hotels are financed by the local banks against the land that they are built upon and a small token amount investment by the owner in equity. The banks will begin to feel the pressure on their books when these hotels can not service their debt of billions of dollars, in actuality tens of billions of dollars.

All said and done, i feel that Pakistan and its new allies, China and the entire block of CIS countries will become a favourite investment destination for the world. Why ? Because money follows opportunities and opportunities are coming to this region. Its our turn now, We have waited 70 long years. Its time that we enjoy for the next 700 years for the patience and SABAR we have shown for the past 70.