WTVN recently asked Jay Young to come on the air in Columbus, OH to discuss the current state of the oil and gas market and the impact of Saudi Arabia’s decision to cut production. Jay, a fourth-generation oil and gas expert, shared his insights on the reasons behind the production cut and its potential effects on the global market.
According to Jay, Saudi Arabia is concerned about the global demand for oil, which has been affected by factors such as interest rate hikes. To maintain oil prices above $70 a barrel, they have decided to reduce supply. The Saudi energy minister aims for market stability, which Jay believes is around $70 to $80 a barrel.
Jay explained that high oil prices would encourage more drilling projects in the United States, particularly in the Permian Basin and Bakken. To prevent this, Saudi Arabia wants to keep prices relatively low but not too low, targeting a range of $60 to $80 a barrel. This strategy helps them maintain their market share while also discouraging US companies from starting new projects.
Jay also discussed the potential for increased demand in the future, which could lead to higher oil prices. However, he believes that Saudi Arabia would likely cut production again if necessary. He also mentioned the United States’ reliance on oil and the possibility of increased drilling if prices rise too high.
In conclusion, Jay Young provided valuable insights into the oil and gas market and the strategies employed by major players like Saudi Arabia. Be sure to check out his book, “Upside of Oil and Gas Investing,” and visit his website at kingoperating.com for more information.