Oil is selling for roughly $83 a barrel on the global market. That’s bad news for Iran, Nigeria, Venezuela, Russia, and Saudi Arabia, among others. They need the black stuff to trade at far loftier levels in order to balance their budgets.
Iran’s budget, for example, is built on oil at $135 dollars per barrel, according to data from Deutsche Bank and Thomson Reuters compiled by DoubleLine Capital.
Russia has oil budgeted at $100, while Saudi Arabia will break even at $95 per barrel.
“All the oil producers are feeling it. Now the question is who can withstand it the most,” said Phil Flynn, an energy analyst at the Price Futures Group.
Drill or die: Flynn claims that energy producing nations will continue to pump up production because they don’t want to risk losing market share.
“It’s like a starring contest of who can last the longest selling oil below their budget point. Whoever can hold out longest is going to win,” he said. “They’re eating at each other.”
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