Dividends and Saudi Arabia, UAE back OPEC production cuts at conference

Every industry in the economy has at least one conference where the leaders of the industry gather together. In most cases, there is more than one, but over the years one conference tends to come up with more decisions than others. Whatever you investments are in, all industries have magazines reporting on them and if you desire you can follow the trends.

Similar to most industries, the governments of the world play an interest and often they like to believe the interests of the government and the generally agreed interests of the industry are more or less in tune with each other.

In an article by Jon Gambrell of the Associated Press, the oil industry met at the Adu Dhabi International Petroleum Exhibition and Conference. The energy ministers of oil producing countries were there to make decisions and reward contacts to the oil industry.

All major lenders are discussing a possible recession next year, and it would be prudent, if a company was a supplier to ensure inventories do not build up too much or to cut production. The statement is from the supplier point of view, for the oil industry the government has a different point of view. The government of the US wants OPEC to pump more oil to increase supply and prices to fall.

The Energy Ministers of OPEC said no, it is prudent to consider and do cuts in production. The Saudi Energy Minister said we owe it to the the upcoming United Nations climate change conference to be held in Egypt to help save the environment.

In early October, OPEC agreed to cut its production by 2 million barrels a day beginning in November.

Amos Hochstein, the US envoy for energy affairs, said energy prices have to be priced in a way that allows for economic growth. Prices cannot be too high that will accelerate an economic downturn.

The US wanted prices to fall for gasoline prices to stop a talking point of the opposition for the midterm elections.

Linking to dividend paying stocks, all companies and all governments have interests that vary from time to time. During election season, a government has a point of view; during economic cycles companies have a point of view; they will not be the same as profits fluctuate. For your investments, do you have a reasonable grasp of the viewpoints?

There are more questions than answers, till the next time – to raising questions.


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