HAVE YOU HUGGED A FRACKER TODAY? How cheap oil is changing the world.

Now then you get a country like Venezuela, which was on the edge even before prices fell from $100 a barrel, well they’re running out of foreign exchange reserves, they’ve fallen from $66 to about $15 billion. And they’re collapsing collapsing and they’re running out of the ability to import food and other materials, and so there you’re dealing with almost societal instability, and order is being maintained by folks with guns.

And so countries are dealing with it differently, it’s been very very difficult. They all want to get out of this as fast as possible – those towering oil inventories and the risk of another oil price collapse and prolonging this hemorrhaging – because no matter what strategy they’ve chosen, they’re all painful. They want out. All producers want out.

But the question is are they willing to cut and cooperate collectively? What we’ve seen since the beginning of the oil market is that it’s very difficult to get producers to cooperate collectively to restrain their production. The temptation is to cheat, to let somebody else do some cutting and you enjoy the higher oil prices. This has always been a challenge for the oil industry.

It couldn’t happen to a nicer bunch of kleptocratic petrostates.