We have seen the oil and materials stocks get killed by the Saudis. Think of it from their perspective. They think they have a great ally in the USA. Then, the USA makes a deal with the Iranians. Oil will flow from Iran now, and the USA is production shale oil using new technologies. Then, the Arab Spring creates democratic calls across the Arab Muslim world. Again, the old kingdom of Saudi Arabia is challenged. When a regime is challenged in multiple ways, the fear about losing relevance rises and rises. What should they do? Show this 'new world' of the USA, Iran, ISIL, and the rest that the old kingdom of Saudi Arabia is still relevant by building up market share inside OPEC and in the world. They stay relevant.
When does oil prices rise? When the kingdom of Saudi Arabia fells comfortable and in control again.
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