OPEC’s Secretary General Abdalla Salem el-Badri isn't afraid to risk stating the obvious: “If we don’t have more supply [of oil], there will be a shortage and the price will rise again.”
Speaking at a conference in Bahrain on Sunday, el-Badri further noted that the collapse in crude prices has hurt the U.S. fracking industry. “Projects are being canceled," he observed. "Investments are being revised. Costs are being squeezed.”
OPEC's Secretary General added that the cartel's decision to keep production intact in the face of falling oil prices "will be left as is" and dismissed speculation the strategy was aimed directly at the U.S. shale industry. "Some also say it was directed at Iran. And Russia. This also is incorrect,” he added.
Of course, maybe it's not any one of those theories but all of them, along with Saudi Arabia's memory of the mid-1980s when it cut production as oil prices fell but lost market share when other OPEC nations didn't follow suit. Either way, it's clear the Saudis are playing multi-level chess and taking a very long-term view.
(Update: Saudi Arabia was prepared to make production cuts in late 2014 but wasn't willing to act unilaterally, says Dan Dicker, author of Oil's Endless Bid and the forthcoming Shale Boom, Shale Bust. "The Saudi oil minister went arould the world in November - including to Venezuela and Russia -- and would've been ready to agree to a production cut if they had gotten some cooperation from some OPEC and non-OPEC states.")
Related: Oil's "race to the bottom" shows OPEC's irrelevance: Ian Bremmer
What el-Badri didn't say, which is equally obvious, is that whether or not Saudi Arabia cuts production is the key to whether oil prices really have bottomed. After coming within a whisker of $100 per barrel in July, West Texas Intermediate plummeted to as low as $44.37 in early 2015, bounced to as high as $54 last month and was at $49.92 in recent trading.
As my colleague Rick Newman has reported, estimates of where oil prices are ultimately heading range dramatically: from as low as $10 a barrel to as high as $200, which happens to be el-Badri's forecast -- assuming investment in energy projects falls drastically from current levels.
Related: Oil's fall picks up steam: Good for everyone, except energy producers
On Monday, Goldman Sachs' energy analysts said there is "risk to our forecast for oil prices remaining at $40 a barrel for two quarters skewed to the upside" citing weather-related disruptions and stronger-than-expected demand. Some of that stronger-than-expected demand is undoubtedly coming from Europe, where growth has picked up in recent months. Last week, the European Central Bank raised its forecast for 2015 growth in the eurozone to 1.5% from 1% in December and upped its 2016 forecast to 1.9% from 1.5% previously.
But U.S. crude oil supplies are at their highest levels in 80 years and storage capacity at least 80% full in Europe, Japan and South Korea, according to Citigroup. Combine that with China's economic slowdown and it's hard to envision the supply-demand equation swinging back in the favor of a sustained rise in oil prices anytime soon, barring a geopolitical event, as Rick and I discuss in the accompanying video.
Notably, Goldman Sachs expects "a sequential deceleration in demand-growth as we enter the spring" and says there is downside risk to its $65 price target for 2016.
Aaron Task is Editor-at-Large of Yahoo Finance. You can follow him on Twitter at @aarontask or email him at email@example.com.