So much for the Saudi's being the monopolist "price setters"

Looks like the Saudi's are no longer in control as monopolist price setters, at least according to Goldman, Sachs.

Goldman Sachs on oil: US needs to cut, not OPEC

Michele Della Vigna, head of European energy research at Goldman Sachs, said non-OPEC oil producers had created the oversupply in the market which has weighed on prices.

"I think the market has realized that where we need to find the adjustment is onshore U.S. and that's where the market is focused," he told CNBC Thursday.

Where we head from here really depends on U.S. producers, who show little signs of cutting back.

J. Barkley Rosser — I Told You So On Oil Prices

… a week ago here I called a bottom to the oil price decline before anybody else in the world did, and it has held, with the price fluctuating between $44 per barrel and $51 per barrel. My post simply reminded the world what most of it had paid no attention to that the Saudis had publicly stated that they were planning their budget on the basis of a world oil price between $45 and $50 per barrel…

As Warren Mosler says, the swing producer is the price setter.

Econospeak
I Told You So On Oil Prices
J. Barkley Rosser | Professor of Economics and Business Administration James Madison University

Iran oil exports fall as SWIFT starts to bite

Since Iran’s cutoff from the global financial payments system (when they were kicked off the SWIFT interbank system), Iran has been having trouble exporting oil. Their exports are now reported to be down 300,000 barrels per day. That is putting upward pressure on crude.

Moreover, all the talk of Saudi “additional production” is meaningless unless the Saudis officially cut their price. Rising Saudi output is nothing more than them selling into new demand for their crude; it’s not going to lead to a lower price unless the Saudis ACTUALLY CUT THE PRICE, which they’re not doing.

It’s a very sly move by the Saudis. They can allow prices to rise and blame speculators, while pointing to their increased output (making them look like the good guys), and no one will know that it is them who is setting prices higher. Until the Saudis officially cut price, expect crude to go higher.