That’s because the world’s #2 producer, Saudi Arabia (12.4 million bbl/day), has decided to increase its output, ending–for now at least–its attempt to stabilize prices at a high level. The move has presumably been prompted by the 10% fall in the world crude price over the past few weeks, a time of typical seasonal strength driven by demand for heating oil during the northern hemisphere winter.

(Note: global oil production is now around 97 million barrels daily, down slightly from a year ago. The US is the #1 producer, lifting 14.8 million barrels daily; Russia is #3, at 11.2 million. There’s a sharp falloff from there to China at #4, 4.9 million.)

What makes this noteworthy is that the Saudis usually do the opposite, that is, they expand and restrict their own output to maintain a stable price. The conventional view, which I think has been correct, is that they’ve long since adopted the role of swing producer, stabilizing prices in order to protect the value of their many decades worth of future production that’s still in the ground.

This may simply be because Saudi Arabia is temporarily short of cash to fund its ambitious program to transform the country’s economic base. On the other hand, there’s a significant amount of consolidation going on in the US, with the purchase of larger independents by the descendants of the 19th-century Standard Oil. There’s also the proliferation of petroleum substitutes in solar panels and hybrid/EV automobiles. And, of course, there’s climate change.

So maybe this is a sign that the Saudis believe an important shift toward maturity in the world oil market is now taking place, with the consequent need for a new production (and, for you and me, a new investment) playbook.