OPEC's Market Share Battle - Komaki Group

Fullerton, CA, February 15, 2015 (Newswire.com) - Komaki Group - OPEC’s pursuit of market share at the expense of supporting prices has a strong likelihood of success given the immense financial reserves of its biggest members says the latest investor alert from Komaki Group.

Much has been said and written about the precipitous fall of crude oil price since June 2014 but while most investors were expecting the oil cartel to cut production in order to support prices, it instead opted to maintain production at current levels despite the consequences for short term prices.

"They Saudis and the Kuwaitis, the biggest producers, would rather eliminate the competition from US shale oil companies by driving prices so low as to make it uneconomical for them to produce."

Komaki Group, Energy Sector Analyst

“It’s perfectly understandable,” said a Komaki Group energy sector analyst. “They Saudis and the Kuwaitis, the biggest producers, would rather eliminate the competition from US shale oil companies by driving prices so low as to make it uneconomical for them to produce.”

The Saudis have claimed they are prepared for a long and protracted period of sub-$50-a-barrel thanks to hundreds of billions of dollars’ worth cash reserves to make up the shortfall of revenues they lose with prices at current prices or lower. US shale companies are already feeling the pinch as an increasing number of low-yield rigs are shut down. “Oil majors are slashing capital expenditure and this will eventually translate into reduced supply and higher prices,” added the Komaki Group analyst.

According to the investor alert, the oil price slump has adversely affected the share price of several sound and highly profitable oil companies. The firm says it is bullish on prospects for a number of oil services groups and has compiled a buy list for clients.