What just happened today

Well today is 27th November. Almost the typical everyday until I seen an article in the news today headlined:

"OPEC Votes Not To Cut Production, Oil Prices Plummet"

In the last 24 hours we have seen oil prices plummet further. Have a look at the to see what I mean:

Bear in mind that earlier this year oil was over $100 per barrel for WTI crude. What we've seen is a whole $3 drop in price today, and the US stock market is still open. Brent oil is less than $72 per barrel as I blog.

The consequences of the opec meeting are significant, to be blunt. Sanctions on the US have cost Russia dearly. As Russian finance minister stated last monday 24th November: "We're losing around $40 billion a year because of geopolitical sanctions, and about $90 billion to $100 billion from oil prices falling by 30 percent". Now its thursday 27th, and with oil prices falling even more than 30% so far today. Russia, as a major oil exporter, will be bearing the cost. Now, OPEC members involve the main players of oil production: Venezuela, Russia, Saudi Arabia for example. Now why would OPEC vote to allow this crash to continue? Russia and Saudi Arabia want this to happen and here's why:

With Oil production in the US soaring, mainly from shale oil exploitation, the US has become no. 1 world oil producer. Russia with all its sanctions, and Saudi Arabia as a competitor, see the US achilles heel: that shale oil production is only cost efficient around $100 per barrel. This opec decision today is to allow excess production and drive the cost of oil down for at least until 2020, in order to crash the US shale industry.

What is going to happen is US will try counter measures, maybe push for more Russia sanctions. US-Saudi relations are more sensitive and I'd believe they're on Barrack Obama's schedule also. The global economy is already sensitive, so if the dollar weakens, which is likely right now, then the US economy should become more unstable. The cost of living for countries that are net oil importers should decrease improving their economies. This is good for Ireland I think. To think of how shale oil production is seriously detrimental to the environment, using the likes of toxic chemicals, and to think of excess oil production leading to excess carbon emissions, the race is bad for the planet. The one hope for global warming is that shale production is stopped dead by 2020. Obama's other hypocritical oath of cutting carbon emission last week(instead of hyphocratic oath) contradicts what he has allowed for oil production to happen. So we have Putin playing world chess with the US using Saudi Arabia as a sidekick in this sidegame. Let's see what happens.