Kuwait wants oil price above $60Sun Jul 5, 2009 4:15am EDTBy Rania El GamalKUWAIT (Reuters) - Kuwait wants to see the price of oil stay above $60 a barrel, the OPEC member's oil minister said on Sunday."We will be watching the market very closely," Kuwait's Oil Minister Sheikh Ahmad al-Abdullah al-Sabah told reporters at parliament. "We would not like to see the price go below a certain level so it at least meets our budgetary requirements."When asked what that level was, Sheikh Ahmad said "$60, at least for Kuwait."U.S. crude slipped to a four-week low of $65.63 a barrel on Friday as the jobless rate in the United States rose to a 26-year high.Crude fell nearly $8 in four days last week from an eight-month peak of $73.38, on signs the economy of the world's top energy consumer was still struggling.Speculation and changes in the strength of the dollar were playing a large part in oil price volatility, Sheikh Ahmad said.Last week, the Gulf Arab state's oil minister said a price over $100 a barrel would hurt the global economy.A breach of $100 would not necessarily bring a boost in oil supply from the Organization of Petroleum Exporting Countries (OPEC), Sheikh Ahmad said on Sunday."I can't increase production without seeing the price and condition of the world economy," Sheikh Ahmad said. "All these have to be taken into account."OPEC members pledged to cut supply by 4.2 million barrels per day (bpd) last year, as they tried to match what they pumped with what the shrinking global economy consumed.The group has kept those output curbs in place this year, and next meets to discuss supply policy in September.OPEC was satisfied with the price of oil, OPEC President Jose Botelho de Vasconcelos said on Friday.(Reporting by Rania El Gamal; writing by Simon Webb; Editing by Valerie Lee)
HONG KONG (MarketWatch) -- Crude-oil futures extended their losing-streak Wednesday, briefly falling below $62 a barrel, after industry data showed that stockpiles of distillates rose more than expected in the previous week.August crude-oil futures dropped as low as $61.99 a barrel on Globex, before recovering slightly. The front-month contract was down 71 cents at $62.22 in the Asian afternoon, on top of a $1.12 drop to $62.93 a barrel in Tuesday trade on the New York Mercantile Exchange.The latest fall came after data released by the American Petroleum Institute showed that stocks of distillates, including diesel and heating oil, rose by a higher-than-expected 3.4 million barrels last week, according to news reports.The front-month contract has slumped significantly from its closing level of $71.60 a barrel last Wednesday on concerns about the energy-demand outlook, and after the Commodities Futures Trading Commission said it was considering applying limits on investments from exchange-traded funds and index investors. See full story.
Oil May Fall as Global Consumption Declines, Survey ShowsBy Jenny GrossJuly 10 (Bloomberg) -- Crude oil may fall on speculation that the global recession and payroll cuts will sap demand and bolster U.S. supply, a Bloomberg News survey of analysts showed.Nineteen of 41 analysts surveyed by Bloomberg News, or 46 percent, said futures will decline through July 17. Nine respondents, or 22 percent, expect the market will be little changed and 13, or 32 percent, forecast that oil prices will rise. Last week, 49 percent of analysts said prices would drop.U.S. gasoline supplies climbed 1.9 million barrels to 213.1 million last week, an Energy Department report on July 8 showed. Inventories of distillate fuel, a category that includes diesel and heating oil, climbed 3.74 million barrels to 158.7 million, the biggest increase since January. The gain left distillate stockpiles 30 percent higher than the five-year average.“I think that distillate and gasoline prices will continue to fall as inventories rise for yet another week,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “This will then pressure crude oil price down a bit more to between $55 and $58” a barrel.The unemployment rate reached 9.5 percent in June, the highest since 1983, the Labor Department said last week.Total U.S. daily fuel demand over the four weeks ended July 3 averaged 18.4 million barrels, down 5.9 percent from a year earlier, the Energy Department said. Distillate demand over the four-week period fell 12 percent to 3.27 million barrels a day.Crude oil for August delivery fell $6.32, or 9.5 percent, to $60.41 a barrel so far this week on the New York Mercantile Exchange. Prices are up 35 percent this year.The oil survey has correctly predicted the direction of futures 47 percent of the time since its start in April 2004. Bloomberg’s survey of oil analysts and traders, conductedeach Thursday, asks for an assessment of whether crude oilfutures are likely to rise, fall or remain neutral in the comingweek. The results were: RISE NEUTRAL FALL 13 9 19To contact the reporter on this story: Jenny Gross in New York at Jgross15@bloomberg.net.Last Updated: July 10, 2009 00:02 EDT
Verleger Predicts $20 Oil This Year on ‘Devastating’ Crude GlutShare | Email | Print | A A ABy Grant SmithJuly 16 (Bloomberg) -- Crude oil will collapse to $20 a barrel this year as the recession takes a deeper toll on fuel demand, according to academic and former U.S. government adviser Philip Verleger.A crude surplus of 100 million barrels of will accumulate by the end of the year, straining global storage capacity and sending prices to a seven-year low, said Verleger, who correctly predicted in 2007 that prices were set to exceed $100. Supply is outpacing demand by about 1 million barrels a day, he said.“The economic situation is not getting better,” Verleger, 64, a professor at the University of Calgary and head of consultant PKVerleger LLC, said in a telephone interview yesterday. “Global refinery runs are going to be much lower in the fall. If the recession continues and it’s a warm winter, it’s going to be devastating.”Crude oil last traded at $20 a barrel in February 2002. Futures were at $61.18 today in New York, having recovered 89 percent from a four-year low reached last December. The Organization of Petroleum Exporting Countries is implementing record supply cuts announced last year in response to plunging consumption.“OPEC don’t realize the magnitude of the cuts they need to make,” which would total about a further 2 million barrels a day, Verleger added. “Storage is going to become tight. It’s not clear if there’s going to be enough storage available.”China, InflationOil will average $63.91 in the fourth quarter, according to the median of analyst forecasts compiled by Bloomberg. Crude for December delivery traded at $65.46 today in New York. Prices have rebounded on expectations of a demand recovery, led by China and other developing economies, and concern expansionary monetary policy would stoke inflation and weaken the dollar.“China is in a real desperate situation,” said Verleger, who publishes the Petroleum Economics Monthly. “We’re in a situation where U.S. consumers aren’t consuming and Chinese manufacturers get hurt. Economists are looking for growth in all the wrong places.”Forward contracts for oil have been higher than prices for immediate delivery this year, a situation known as contango, creating incentives to buy crude now and store it. That may end as growing stockpiles make storage more expensive.“Prices would be much lower today, but for the very large incentive to build inventories,” Verleger said. “You need forward buyers, which we had when people were fearing inflation, but as concerns turn toward deflation” that will no longer be the case.To contact the reporters on this story: Grant Smith in London at gsmith52@bloomberg.netLast Updated: July 16, 2009 04:30 EDT
OPEC Spare Capacity May Stymie Oil’s Rally: Chart of the DayShare | Email | Print | A A ABy Mark ShenkAug. 13 (Bloomberg) -- Crude oil prices, which have surged 60 percent this year, may not rise above $80 a barrel because spare production capacity among OPEC members has swollen.The CHART OF THE DAY shows the relationship between crude oil futures traded in New York and excess output capacity of the Organization of Petroleum Exporting Countries this decade. Prices climbed to a record $147.27 on July 11, 2008, when OPEC members had the ability to bring fewer than 3 million barrels of additional production online.In March the 12-member group could have produced 6.84 million barrels a day above its actual production, if needed, the most since 2001, according to a monthly Bloomberg News survey of oil companies, producers and analysts. That margin was 6.11 million barrels last month.“The numbers have gotten much larger over the past year,” said Rick Mueller, a director of oil markets at Energy Security Analysis Inc. in Wakefield, Massachusetts. “The Saudis alone probably have close to 3 million barrels excess capacity. The excess shows how effective OPEC’s been in managing the market.”OPEC agreed at three meetings last year that the members with quotas would cut output by a combined 4.2 million barrels a day to 24.845 million in a bid to bolster prices. The group is scheduled to discuss production levels in Vienna on Sept. 9 after leaving output unchanged at two meetings this year.“The Saudis are happy with oil in the $70-to-$80 range,” Mueller said. “It’s low enough to stop development of some oil sands and alternative energy sources while not hurting the economy. If prices rose above $75 they would open the spigot.”Saudi Arabian Oil Minister Ali al-Naimi said on May 23 in Rome that crude oil at $75 a barrel would be healthy for the global economy. The aim will be “keeping it between $70 and $80,” he said. The Kingdom is the world’s biggest oil exporter.To contact the reporter on this story: Mark Shenk in New York at mshenk1@bloomberg.netLast Updated: August 13, 2009 07:07 EDT
World Oil Exports; US Oil Imports; and a Few Thoughts on CanadaPosted by Gail the Actuary on August 13, 2009 - 10:15amTopic: Demand/ConsumptionTags: canada, oil exports, oil imports, oil sands, tar sands [list all tags]Matt Mushalik from Australia was good enough to send me this graph of world oil exports, calculated from new oil data provided by the EIA.Figure 1. World net exports, based on EIA dataThis inspired me to put together a few other somewhat related graphs, relating to oil exports and US imports. Since Canada is such a tiny piece of world exports, but seems to be mentioned as a possible major source of future US imports, I have looked at it separately as well.The likelihood of a huge ramp up in imports from Canada seems remote. Canadian exports to the US require continued imports to the East Coast of Canada. If imports of oil to Canada decline as world exports decline, US oil imports from Canada may also decline, because ramped up production from oil sands may not be enough to offset declines in production and imports elsewhere.
What if oil weren't priced in dollars?Posted by JUSTIN FOX Tuesday, October 6, 2009 at 5:35 pm6 Comments • Trackback (1) • Related Topics: capital flows, china, trade, dollar, oil, persian gulfRobert Fisk's report in the Independent that the Persian Gulf countries are planning to stop pricing oil in dollars by 2018 and start using a basket of currencies instead has caused quite the big stir today. Gold hit a new record of $1,043 an ounce as investors worried about the future of the dollar, and the Internets were aflame with the news (especially the right-wing Internets, apparently.) Saudi and Kuwaiti officials immediately said there's no such move in the offing, but it's obviously something they've been thinking about. Just under two years ago there was a big flurry of discussion on the subject, including an OPEC vote to study switching to a currency basket.If the Gulf countries stopped pricing oil in dollars, they would also presumably stop pegging their currencies to the dollar, a more significant development. And of course Chinese officials have been making noise for several years about the need to move away from a dollar-dominated world. The problem that both China and the oil exporters have is that they're holding gigantic stashes of dollars that would suddenly be worth a lot less if they started trying to sell them off. So we've got this impasse, where lots of people complain about the dollar's supremacy but nobody seems willing to do anything about it. In fact, a succession of U.S. Treasury Secretaries has trooped to Beijing trying to persuade the Chinese to do something about the dollar's supremacy by letting the yuan float or at least rise sharply against the dollar, and met with strong resistance.It's the sense that this can't go on forever that keeps putting downward pressure on the dollar. And this shouldn't go on forever. The U.S. economy's share of global economic output has been declining and will almost certainly continue to decline as formerly poor countries get richer. With that, the dollar's role will need to change.Such a change wouldn't be unmitigated bad news for Americans. As I've written before, having the dollar as the world's currency has been a mixed blessing. The dollar's global role inflates its value, for example, which makes imports cheaper for consumers here but also makes U.S products less competitive globally. Dollar supremacy also allows the U.S. government (and until recently the private sector) to get away with wildly unbalanced budgets without paying an immediate penalty in higher interest rates, which can be nice for a while but tends to end in trouble. The global capital-flow imbalances that many economists now say were at the root of the financial crisis are in significant part a product of the dollar's outsized role.All of this means that it may well be in the long-run best interest of the U.S. to push for an orderly transition away from the current dollar-based global monetary system and toward one built around currency baskets, the International Monetary Fund's special drawing rights, the bancor, gold or whatever other measure of value we can all agree on. In other words, it's not the worst news in the world that the Persian Gulf countries are talking about moving away from the dollar. Even if they say they aren't.Update: As jomiku notes in the comments, Fisk has something of an agenda. He is also a hardworking reporter, and this particular article strikes me as mostly credible, even if his follow-up column in Wednesday's paper is mostly incomprehensible. Any change being planned for 2018 is going to be awfully tentative, though, and the part in Fisk's original article about the dollar not being part of the currency basket in which oil will be priced is probably nonsense.Read more: http://curiouscapitalist.blogs.time.com/2009/10/06/what-if-oil-werent-priced-in-dollars/#ixzz0TE3ARGAe
Pickens predicts oil prices to soarOil tycoon increases his oil and natural gas exposure with prices set to rise with economic recovery.NEW YORK (Reuters) -- Texas oil tycoon T. Boone Pickens said Tuesday he has increased his long oil and natural gas position in recent weeks."It's not my personality to be short," said the billionaire who has made his fortune investing in the oil sector.Oil prices are likely to be around $75 a barrel by the end of 2009 and $85 by the end of 2010, Pickens said, but added that an economic recovery could boost prices much higher."If you have a global recovery, then you could easily be $90 a barrel next year, you could be $100 a barrel," he said.0:00 /2:57'Dropping' the dollar for oilHe also said that he sees the average price for natural gas next year at $7 per million British thermal units, up from about $5 currently.The passage of the U.S. climate legislation currently in consideration in the Senate is essential for keeping oil prices from rising exponentially over the next decade, he said.Without a plan for U.S. energy independence, oil prices could soar to $300 a barrel in 10 years, Pickens said.Pickens said that he believes the bill will come to a vote by the end of the year and that it will make President Obama's campaign goals of eliminating dependence on oil from the Mideast in 10 years achievable."If you do that, then you can cut out Mideast oil in 10 years," he said. To top of page
The $2.5 trillion global oil scamBy Dan Jones | 11/17/09 - 09:00Global Oil ScamApparently, there's a global oil scam making Bernie Madoff look like a petty thief.If serial entrepreneur and Seeking Alpha columnist Philip Davis is to be believed, the world is being scammed out of $2.5 trillion, 50 times greater than the sum Madoff took from the duped investors.According to Davis, the scam starts in 2000 with the formation of the ICE - the Intercontinental Exchange. The ICE - founded by Goldman Sachs, Morgan Stanley, BP, Total, Shell, Deutsche Bank and Societe Generale - is an online commodities and futures marketplace that exists outside the US and operates free from the constraints of US laws.After a Congressional investigation into energy trading in 2003, the ICE was found to be facilitating "round-trip" trades. This is where one firm sells energy to another, and then the second firm sells the same amount of energy back to the first company, at the same time and at the exact same price, as told by Davis.http://www.uolevents.org/eventlogos/world%20in%20oil_LR_shutterstock_4174132.jpgNo commodity ever changes handsQuite shockingly no commodity ever changes hands, but the transactions still send a signal to the market, artificially boosting company revenue. Angry yet? There's more.Because the trading is unregulated by Washington, its difficult to gauge the scale on which "round-trip" trading takes place.But when DMS Energy were investigated by Congress, the company admitted that 80 percent of its trades in 2001 were round-trip trades. This means 80 percent of all trades in that year were false trades. Not a drop of oil changed hands, but the balance sheets showed increased revenue.The idea is to hike up commodity prices. For example, according to Davis, after the ICE turned commodity trading into a "speculative casino game where pricing was notional and contracts could be sold by people who never produced a thing, to people who didn't need the things that were not produced", Goldman Sachs were able to triple the price of commodities in just five years.ICE can create artificial shortages and drive speculative demandThe beauty (or rather the horror) of the scam outlined by Davis is that because they control the oil markets, the ICE can create artificial shortages and drive speculative demand in order to charge consumers an extra dollar per gallon of gas. And whereas this may not seem like much, this $1 soon becomes $50 billion A MONTH as global drivers consume 1.7 billion gallons of gas every single day.Whereas, at this stage, it would not be accurate or indeed wise to suggest what Philip Davis claims is either true or false, one cannot ignore the issue. There have been concerns for many years that global markets are controlled by a monopoly of mega-organizations, but there could be a strong case for suggesting the ICE is close to becoming just that - a super-organization with the power to push oil prices up or down.Good luck Washington, you might just be getting a deluge of mail demanding answers.The slide show below comes from SlideShare.net and gives a breakdown of the global oil scam.2.5 Trillion Oil Scamhttp://www.slideshare.net/theoilman/25-trillion-oil-scammore : http://www.slideshare.net/theoilman
• Shortfall could reach 10m barrels a day, report says • Cost of crude oil is predicted to top $100 a barrelguardian.co.uk, Sunday 11 April 2010 18.47 BST Surplus oil production capacity could disappear by 2012 a report from US Joint Forces Command, says. Photograph: Katja Buchholz/Getty ImagesThe US military has warned that surplus oil production capacity could disappear within two years and there could be serious shortages by 2015 with a significant economic and political impact.The energy crisis outlined in a Joint Operating Environment report from the US Joint Forces Command, comes as the price of petrol in Britain reaches record levels and the cost of crude is predicted to soon top $100 a barrel."By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 million barrels per day," says the report, which has a foreword by a senior commander, General James N Mattis.It adds: "While it is difficult to predict precisely what economic, political, and strategic effects such a shortfall might produce, it surely would reduce the prospects for growth in both the developing and developed worlds. Such an economic slowdown would exacerbate other unresolved tensions, push fragile and failing states further down the path toward collapse, and perhaps have serious economic impact on both China and India."The US military says its views cannot be taken as US government policy but admits they are meant to provide the Joint Forces with "an intellectual foundation upon which we will construct the concept to guide out future force developments."The warning is the latest in a series from around the world that has turned peak oil – the moment when demand exceeds supply – from a distant threat to a more immediate risk.The Wicks Review on UK energy policy published last summer effectively dismissed fears but Lord Hunt, the British energy minister, met concerned industrialists two weeks ago in a sign that it is rapidly changing its mind on the seriousness of the issue.The Paris-based International Energy Agency remains confident that there is no short-term risk of oil shortages but privately some senior officials have admitted there is considerable disagreement internally about this upbeat stance.Future fuel supplies are of acute importance to the US army because it is believed to be the biggest single user of petrol in the world. BP chief executive, Tony Hayward, said recently that there was little chance of crude from the carbon-heavy Canadian tar sands being banned in America because the US military like to have local supplies rather than rely on the politically unstable Middle East.But there are signs that the US Department of Energy might also be changing its stance on peak oil. In a recent interview with French newspaper, Le Monde, Glen Sweetnam, main oil adviser to the Obama administration, admitted that "a chance exists that we may experience a decline" of world liquid fuels production between 2011 and 2015 if the investment was not forthcoming.Lionel Badal, a post-graduate student at Kings College, London, who has been researching peak oil theories, said the review by the American military moves the debate on."It's surprising to see that the US Army, unlike the US Department of Energy, publicly warns of major oil shortages in the near-term. Now it could be interesting to know on which study the information is based on," he said."The Energy Information Administration (of the department of energy) has been saying for years that Peak Oil was "decades away". In light of the report from the US Joint Forces Command, is the EIA still confident of its previous highly optimistic conclusions?"The Joint Operating Environment report paints a bleak picture of what can happen on occasions when there is serious economic upheaval. "One should not forget that the Great Depression spawned a number of totalitarian regimes that sought economic prosperity for their nations by ruthless conquest," it points out.
Russia has overtaken Saudi Arabia to become the world’s greatest producer of oil.According to the latest Statistical Review of World Energy, Russia increased oil production by 1.5% in 2009, claiming a 12.9% market share.Production in Saudi Arabia fell 10.6%, giving the country a 12% market share.But the US has become the world's largest gas producer, surpassing Russia.Global proven oil reserves increased 700 million barrels to 1.33 trillion barrels last year while the world's gas reserves grew by 2.21 trillion cubic meters to 187.49 trillion cubic meters.
Author
Topic: [Focus] Crude Oil Market n News (Read 16178 times)
