“It’s Different This Time?” What Happened To US Oil Drillers During The Last Price War

zerohedge.com by Tyler Durden on 11/26/2014 14:38
History may not repeat but it rhymes so loud sometimes that Einstein would be rolling in his repetitively insane grave. As Bloomberg notes, the last time that U.S. oil drillers got caught up in a price war orchestrated by Saudi Arabia, it ended badly for the Americans. “1986 was the big price collapse and the industry did not see it coming,” said Michael Lynch, president of Strategic Energy and Economic Research who has covered the oil sector for 37 years, “it put a lot of them out of business. You just don’t forget it. It’s part of the cultural memory.” Think it can’t happen again? Think again… consider how levered US Shale drillers are and just what Saudi has to gain from keeping their foot on the US neck… In 1986, the U.S. industry collapsed, triggering almost a quarter-century of production declines, and the Saudis regained their leading role in the world’s oil market.
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