>>> SAUDI ARABIA’S PROBABLY THE SECOND BIGGEST OIL PRODUCER.
THEY’VE WORKED WITH US VERY
WELL.
WELL. WE’VE KEPT OIL PRICES DOWN.
IF YOU WANT TO SEE OIL PRICES GO
TO $150 A BARREL, LIKE BY THE
WAY RUSSIA WOULD LOVE TO SEE
THAT, ALL YOU HAVE TO DO IS
BREAK UP OUR RELATIONSHIP WITH
SAUDI ARABIA.
SAUDI ARABIA. >> THE PRESIDENT HAS BEEN VERY
CLEAR WHY HE’S OKAY WITH SAUDI
KILLING AND REPORTEDLY
DISMEMBERING A U.S. RESIDENT AND
"WASHINGTON POST" COLUMNIST LAST
MONTH.
MONTH. IT IS BECAUSE AT LEAST IN PART
HE BELIEVES THAT SAUDI ARABIA
CAN SUPPLY THE UNITED STATES
WITH CHEAP OIL.
SOMETHING HE CONTINUED TO BRAG
ABOUT TODAY TWEETING "OIL PRICES
GETTING LOWER, GREAT, LIKE A BIG
TAX CUT FOR AMERICA AND THE
WORLD, ENJOY $54 WAS JUST $82,
THANK YOU, SAUDI ARABIA, BUT
LET’S GO LOWER."
TRUMP’S UNABASHED WILLINGNESS TO
LINK HIS STEADFAST SUPPORT TO
SAUDI ARABIA DESPITE THEIR
BRUTAL MURDER OF JAMAL
KHASHOGGI, NOT TO MENTION THE
WEEKS AND WEEKS OF LYING ABOUT
IT AND HIS LOVE OF CHEAP OIL
RAISE A NUMBER OF QUESTIONS,
MOST ESPECIALLY IS THERE SOME
KIND OF EXPLICIT DEAL HERE?
HERE WITH ME NOW DAN DICKER.
HE REMAILED ME YESTERDAY TO
HYPOTHESIZE THAT, YES, THERE WAS
SOME KIND OF DEAL BETWEEN THE
TRUMP ADMINISTRATION AND THE
SAUDIS WITH OIL PRICES AND THE
KHASHOGGI MURDER.
KHASHOGGI MURDER. >> LET’S DO SOME RECONNAISSANCE,
HISTORY, DEALING WITH A LOW
PRICE OF OIL AND THEY NEED A
HIGH PRICE OF OIL.
THEIR ECONOMY IS ALMOST 100%
BASED ON OIL REVENUE, RUSSIA,
MORE THAN 50% OF THEIR REVENUES
BASED ON OIL.
THEY’RE DEALING WITH A BAD PIECE
OF OIL ACTION WHERE OIL WAS
TRADING IN THE $30 RANGE, GOING
BACK TO 2016.
AT THIS POINT MBS HAS -- HE’S
CONSOLIDATING POWER, HAS A NEW
PLAN, HE’S GOING TO CONTROL
SUPPLY.
SUPPLY. HE PUTS TOGETHER A CONSORTIUM,
NOT OF OPEC MEMBERS, BUT OF
RUSSIA TOO, TO CONTROL
PRODUCTION, REALLY CUT IT BACK
VERY, VERY STIFFLY.
NOW, REMEMBER THE CARTEL DOES
NOT HAVE A GOOD RECORD OF
KEEPING THESE THINGS TOGETHER.
>> PART OF THE REASON HE HAS TO
MAKE THE -- HE HAS THIS ABILITY
TO HOLD THIS TOGETHER FOR TWO
YEARS WITH COMPLIANCE NOT OF
100%, BUT OF 110%, 115% WHERE
THE SAUDIS ARE ACTUALLY THROWING
IN MORE PRODUCTION CUTS TO MAKE
SURE THAT THEY SOAK UP THE EXTRA
SURPLUS THAT WAS IN THE MARKET
AND WE’RE WATCHING OIL PRICES
RISE.
RISE. AND AS WE’RE WATCHING OIL PRICES
RISE OVER THE FEW YEARS, TRUMP
IS GETTING MADDER AND MADDER AND
MADDER.
MADDER. HE’S TWEETING AT THE SAUDIS, WE
WON’T ALLOW THIS TO HAPPEN, THIS
MANIPULATION OF AN OIL MARKET,
GETTING MORE AND MORE MAD AS OIL
PRICES ARE GOING ON.
FAST FORWARD, KHASHOGGI IS
MURDERED, A WEEK LATER, POMPEO
GOES TO RIYADH TO TALK ABOUT
WHAT WENT DOWN IN TURKEY, COMES
OUT OF THE MEETING AND THEY --
WHAT DID YOU TALK ABOUT?
OH, WE DIDN’T EVEN MENTION
KHASHOGGI IN THIS MEETING.
REALLY?
REALLY? OKAY, FINE.
OKAY, FINE. THREE DAYS LATER, AL FELI, SAUDI
OIL MINISTER, SAYS WE’RE NOT
ONLY GOING TO INCREASE
PRODUCTION, THE SAUDIS, BUT
WE’RE SAYING TO THE REST OF OPEC
THAT YOU CAN OPEN YOUR SPIGOTS
AS WIDE AS YOU WANT RIGHT NOW
AND WE’RE ALL SAYING THIS GOES
AGAINST THE ENTIRE STRATEGY THE
SAUDIS HAVE BEEN SO PAIN STAKING
TO PUT TOGETHER, THEY HAVE EVEN
BIGGER PLANS WITH A MONTIZATION.
BUT FOR THIS MOMENT THEY’RE
SAYING WE’RE DONE WITH THIS
PROPOSAL.
PROPOSAL. EVERYBODY, ALL THE TRADERS, ALL
THE HEDGE FUNDS START TO FLEE.
AND IN TWO AND A HALF WEEKS --
>> BASED ON THE STATEMENT, THE
TOP SAUDI OIL OFFICIAL SAYS THIS
THING, THEY GO DOWN $25 OR
WHATEVER IN --
>> BUT WE’VE NEVER SEEN THEM GO
DOWN LIKE THIS WITHOUT SOMETHING
ELSE GOING WRONG.
IN 2008, A MAJOR CREDIT CRUNCH,
THE EQUITY MARKETS ARE GETTING
PUMMELLED, THE DOLLAR IS GOING
UP.
UP. SOMETHING ELSE HAS TO BE GOING
ON.
ON. SOME OTHER COMMODITY IS GETTING
KILLED.
KILLED. BUT NO, JUST OIL, STRAIGHT DOWN
$25 WITHOUT A STOP FOR TWO AND A
HALF WEEKS.
HALF WEEKS. >> WE’VE ALSO SEEN AT THE SAME
TIME SEEN THE MARKETS GO DOWN,
THE MARKETS APPEAR TO BE PRICING
IN SIGNALS THEY THINK IT’S LATE
CYCLE, HEADED TOWARDS A
RECESSION, YOU DON’T THINK
THAT’S WHAT’S DRIVING THE OIL?
>> IT’S HELPED.
THERE WERE A LOT OF --
>> THERE’S A LOT OF BEAR MARKET
INDICATORS.
INDICATORS. >> THEY WERE KIND OF ALWAYS
THERE.
THERE. BUT WHAT THERE REALLY WERE WAS
MOST PEOPLE IN THE FINANCIAL
COMMUNITIES WHO BELIEVED THE
SAUDIS WOULD CONTINUE WITH THEIR
PLAN OF SUPPORTING THE OIL
MARKET GOING INTO 2019.
>> WHEN THEY BAILED ON THAT,
EVERYBODY JUST BECAME IN LIKE AN
AVALANCHE OF SELLING.
>> YOU E-MAILED THIS THEORY
YESTERDAY.
YESTERDAY. IT’S PLAUSIBLE.
IT’S PLAUSIBLE. I SAID, DO YOU HAVE EVIDENCE,
NO, IT’S JUST THE WAY THE
CHRONOLOGY LINES UP.
>> AND IT WOULD ALL SEEM
CIRCUMSTANTIAL EXCEPT FOR THE
FACT OF THE LAST TWO DAYS WHERE
TRUMP IS ALL THE SUDDEN REALLY
PLEASED WITH THE WAY THE SAUDIS
ARE HELPING US, AND ALSO QUOTING
ON THE WHITE HOUSE LAWN THAT
THEY ARE WORKING WITH US ON OIL
PRICES.
PRICES. REALLY?
REALLY? THE PRESIDENT IS NOW WORKING
WITH THE SAUDIS ON OIL PRICES?
HOW DID THAT TURN AROUND SO
QUICKLY?
QUICKLY? THIS WOULD HAVE ALL SEEMED
CIRCUMSTANTIAL, OR AT LEAST YOU
COULD HAVE PUT IT OFF AS
CIRCUMSTANTIAL IF NOT FOR THE
FACT THAT TRUMP IS, IN FACT,
ADMITTING OPENLY THAT HE DID IN
FACT HAVE A DEAL, THEY ARE
WORKING TOGETHER WITH THE SAUDIS
IN TERMS OF GETTING OIL PRICES
LOWER.
LOWER. >> BRAGGING ABOUT IT TODAY,
ANOTHER TWEET ABOUT HOW THERE’S
SO MUCH TRAFFIC BECAUSE OIL
PRICES ARE SO LOW, IT SEEMS
PLAUSIBLE.