The output from the Ghawar field has almost certainly peaked, which means that additional output will cost incrementally more as time goes by. One only needs to look at the amount of water they're pushing into their wells to see that they're already in trouble.
I'm not sure where you're getting that $10 lifting-cost number, but even the most optimistic past estimates put Saudi Arabia's lifting costs closer to $20 per barrel. However, their lifting costs aren't the real issue. The Saudi regime needs oil in the $80-$100 range in order to fund their massive social programs (a.k.a. the bribes that keep all their unemployed youth from going radical). Sure, they've got a lot of cash on hand, but they're burning through it at a phenomenal rate.
It's interesting to note that Ali al-Naimi commented at the OPEC meeting:
- "Oil production is a sovereign right. They are free to do what they want." [Referring to other OPEC members]
- "It is a free market, everyone is free to produce as much as he wants."
- "Have we ever told Iran what to produce?"
In other words, "we'd like to open the spigots and drive the price down, but we don't have the reserves available to do that. Maybe someone else can help us out..."
I really would suggest that people go to the BreitBurn investor website and listen to their presentation at last week's NAPTP MLP investor conference. All things considered, their financial position is not bad. Their distribution coverage is about 2.25x and they can handle a couple years' worth of low oil prices. These guys have been in business for 25 years; they know what they're doing, and they acted quickly and decisively to deal with the downturn in the energy market.
Oil has always had long boom-bust cycles. That's just how it works. The question is whether any particular company will be able to survive the cyclic ebb. BBEP is one of the ones that will make it.
You have all these bad feelings about the company, all this "secret knowledge" of (presumably) dirty dealings, and apparently some long-term unrealized capital loss. And since the suspension of the dividend, it hasn't provided any income to holders of common shares. Then why are you still maintaining a position in this security?
ARCP Isn't an aged parent, or a sick spouse, or an ailing pet. You don't owe it any loyalty or allegiance. It's just a stock. Rather than clutter up this message board with pointless grousing, why not put your money somewhere else, and move on?
Do you really get so much satisfaction out of griping in public, that it's worth losing money over? Is that why you keep the position -- so you can complain?
- "its true that the CEO doesn't really have anything to say, they could say something"
So you're upset that someone from ARCP isn't patting you on the head, making soft cooing noises, and telling you, "It's okay, it's okay."
- "we are shareholders. We don't matter, we are along for the ride so that the executives can make their millions."
It sounds like you have issues around a sense of personal inferiority. Why else would you be acting like such a victim? The stock market is a very expensive place to work through that kind of thing. Maybe a support group or a therapist would be more helpful.