LONDON – Saudi Arabia’s move to cut the price of oil heading to the United States, while increasing oil prices to European and Asian customers, has “injected fear into the oil markets,” reports OilPrice.com.

With the price of OPEC crude below $80 a barrel — the lowest in about four years — the news source notes that some observers are suggesting that the cartel is preparing for “a global price war.”

The news source writes that OPEC production has remained level despite worldwide demand, while U.S. production has reached its highest level in more than three decades, creating a buyer’s market for oil.

One reason for Saudi Arabia’s price cut to U.S. customers is seen by some observers as an effort to undermine the shale oil boom. A second reason is “to lure U.S. refiners to buy cheaper oil from Saudi Arabia and thus increase their profits.” Either way, Saudi Arabia’s actions are leading to a price war, as noted by Iraqi Oil Minister Adel Abdul Mahdi, who recently said that OPEC members are fighting one another to hold on to their shares of the petroleum market, notes the news source.

“As frightening, or at least chaotic, as all this may sound, however, there are positive signs,” writes the news source, adding that the national average for regular gasoline dropped 6 cents to under $3.00 a gallon, according a AAA report on November 4. So while consumers and “industrial customers” are winning, the losers so far are the oil and natural gas industries.

“They’ve been enjoying a kind of windfall in the past few years as they've increased exploration and production of shale oil,” writes the news source, adding, “Now, though, their share prices are falling for fear that their profits will begin eroding.”