Big Oil Companies Should Adopt a Self-Liquidation Strategy
The article ignores some realities. 1) The major OPEC producers need to recover far more than their lifting costs. Their oil revenues subsidize the rest of the economy and is their bulwark of social stability. Some estimate that Saudi Arabia needs $90/bbl. 2) Technological adaptation to the low price regime is happening as we speak. The years of $100/bbl oil   developed expensive innovations, and now we are seeing <i>those</i> prices reduced to their marginal costs. 3) Almost no other country can use these new technologies as profitably as the US and Canada can. The US and Canada have a private mineral ownership regime, as well as a production and refinement infrastructure no other country will be able to match soon.<p>The US has a LOT of small- and intermediate-sized oil companies competing actively right now, on all these dimensions, to lower their costs so they can continue to operate profitably even in the current price environment. Most are succeeding.