Comments by "Paul Aiello" (@paul1979uk2000) on "The Russian Oil Price Cap Explained" video.

  1. OPEC reminds me of a cartel that fixes energy prices among themselves. Maybe it's high time western countries separate the price point of oil, gas and renewables from each other so consumers can actually see the benefits of the lower price points. Best way to get real change is for consumers to feel the benefit but the way it's set up now, renewable energy price is sold to consumers at the same price as the most expensive fossil energy, so gas in this case and it's easy to understand why they would do this, they don't want consumers to realize how cheap renewable energy is compared to gas and oil because if consumers start to realize that, we'll end up seeing massive investments going into renewables, far more than we are seeing now and it's easy to see how that would be bad news for OPEC, so they rig the market to make it seem like alternative energy like renewables is expensive and honestly, it's remarkable they got away with it.
    26
  2. Hence why Russia is angry, they know this isn't a matter of diversifying it's oil away from the west, having a global cap of $60 on Russian oil will give countries like China and India more clout to get a deep cut, maybe around 30% cut under the $60 mark, so this likely will hurt Russia, regardless of what countries are buying or not buying.
    13
  3. The funny thing is, if OPEC isn't careful and they continue to play their games with cutting production to bump up the price, it could backfire on them because most countries are not going to accept high energy prices for too long, high energy prices are likely going to mean far more investments into alternative cheaper energy sources, hence why energy crisis don't usually last that long because investments in alternatives usually skyrocket. So the problem for OPEC, they are desperate to bump the price up, but they likely know that doing so will likely kill their oil industry off and considering how some of these countries are very dependent on that revenue, it's a highly risky move to play games with that, unless they are dumb enough to think western countries will just accept high prices lol, truth is, they'll accept it short term till they adapt, but longer term, they are likely going to move away from oil and gas unless the energy market becomes a lot more stable and the price point becomes more normal.
    5
  4. I think we should remember that what the EU, US and the west are doing is operation squeeze, it takes time but bit by bit, you chip away at Russia that they become so weak that they are no real threat any more. Also, there are many ways the west can target countries that buy from Russia, either with tariffs on goods, sanctions or even target the specific companies that do business with Russia and it's something the west is likely to do once European countries diversify their energy needs enough. After all, there's no way the western countries are going through all this only for the likes of China and India to prop up the Russia economy, there is likely going to be a cost to those countries, maybe a high cost longer term. As for Russia, they can be as angry as they want, there's not much they can do about this, western countries know that a cap limits the profits Russia can get, one by limiting the price point but more importantly, giving other countries like China and India more clout to demand lower prices from Russia, that is where the real anger is coming from in Russia, because it's not as simply of Russia saying we'll sell to other countries, they know these other countries have a better bargaining chip against Russia to lower it's oil price and the same could well happen on gas longer term and as I said above, this is about squeezing Russia longer term until they either become too weak or learn their lessons on this war with Ukraine. As for OPEC, what can they really do? yes they can threaten to cut production to bump up oil prices, but they know that isn't a good long term thing to do, high energy prices will kill the fossil industry sooner rather than later and really, it's in the interest of OPEC countries to stabilize the energy market and bring oil prices back to some normal price point, energy crisis don't usually last long for a reason, because when oil and gas prices skyrocket, so does investment and use of alternative energy, to put it another way, the higher energy prices are and the energy market stays unstable, the better it is for renewable and alternative energy sources and the longer this drags on, it can do real damage to the OPEC countries if they become too greedy.
    1