Joined: Apr 21, 2004 Posts: 508 Location: Republic of Texas
Posted: Thu Jun 03, 2004 7:14 am Post subject:
I can't understand why no one in the media seems worried that opec may soon be running at 100%. All I hear is "Oh, saudi will go to max production and the oil crisis will be averted". What do we do next year?
Joined: Apr 03, 2004 Posts: 6547 Location: My Grandkids' Farm
Posted: Thu Jun 03, 2004 8:00 am Post subject:
That's really interesting! I knew the US paying more was all abouth the dollar but I didn't know it was that close.
This latest run up follows as well; with the dollar Euro at $1.27 in Jan & Feb oil went to the mid thirties.
Looking forward to more with expanded money supply.
Great catch, Barbara! _________________ Make a plan and work it:
I'm not sure that there may be some confusion in the media between the concepts of quotas and actual production.
I find it difficult to say either way as the actual words of OPEC members are rarely reported.
Consider this from www.ananova.com:Ananova
"We have decided to lift the ceiling to 25.5 (million barrels a day) effective July 1 and 26.0 (million barrels a day) effective August 1 and we will meet to review future action on July 21 in Vienna," Saudi Oil Minister Ali Naimi said.
Is that lifting the production ceiling or the quota ceiling? It appears to be talking about quotas, but the headline of the article is "OPEC agrees to raise production".
As it is widely understood that Saudi Arabia is already producing beyond quota then the production of oil may not change at all..
Perhaps Saudi is already producing 100% and they're just trying to get that amount legitimised?
One might suggest that this whole OPEC meeting is an attempt to avoid saying "Sorry folks, we just can't produce anymore" without remaining ominously silent and allowing speculation to fill the gap?
Posted: Thu Jun 03, 2004 8:54 am Post subject: $40+
I question if SA can even ramp up the modest couple million barrels per day.
Do we really think that @ $40+ per barrel they have been holding back production?
What sold for $28 not long ago, is now worth $40. And now I'm supposed to believe that SA has been holding back 2 million barrels a day for some reason? $36 million per day in profit left in the ground?
The simplest explanation, tends to be the correct one. _________________ "When you understand why you dismiss all the other possible gods, you will understand why I dismiss yours." - Stephen F Roberts.
Joined: Apr 03, 2004 Posts: 6547 Location: My Grandkids' Farm
Posted: Thu Jun 03, 2004 12:35 pm Post subject: The Elephant in the Newsroom
Just want to get this in quick, I goota make money.
I heard three separate radio news / opinion shows so far today where the same line was repeated to the effect; “We don’t know if OPEC actually HAS any extra capacity.”
No follow up to that astounding statement. Isn’t anyone curious enough to ask; “But if they have no extra capacity, how are we going to meet the growing demand?”
Comments? _________________ Make a plan and work it:
Joined: May 21, 2004 Posts: 82 Location: Kansas City
Posted: Thu Jun 03, 2004 12:52 pm Post subject:
Further: The biggest problem in public awareness right now is that people only connect the price of crude to their *personal* ability to travel inexpensively.
We are whiners and complainers so of course you're seeing plenty of coverage of the discontent caused by the higher prices; but we are selfish and the media is either too lazy or too bought to connect the dots for those who haven't figured out that they are plugged into the Matrix.
It simply does not enter into the public conscience that the REASON the vast majority of us have jobs managing the flow of information rather than the flow of goods is because we've been outsourcing all that work through the Earth, who charges us little but apparently has really high interest rates.
It really is stunning, how no one's considering the implications of what they are saying. This morning on CNN, they were talking about it.
From the transcript: CNN
Quote:
CAROL COSTELLO: So, OPEC is meeting. OPEC often says it's the scapegoat for the high price of oil. Is that true? Is there anything OPEC can do in these meetings to bring down the price of gas in the short run?
JEFF ROSENSWEIG, EMORY UNIVERSITY: In this case, they are the scapegoat, and they're already doing what they can. We saw the price of oil come down a lot yesterday, about six percent over $2, because they started pumping oil yesterday, which was a nice sign, because sometimes they get to these meetings and they talk...
COSTELLO: Well, that's a sign that OPEC can do something to bring the price of gas down.
ROSENSWEIG: Except that it went up a little bit the day before. You know, it's really fluctuating a lot. So I think what they can do is they can do everything they can, which they're doing, or they will do, I think, at the end of this meeting. The only thing is they can only do so much because we're in a very strange situation in the world right now where it's really demand that's driving the equation. It's not supply.
They can control supply, but the U.S. is the world's biggest consumer of demand and we have a new number two and rising fast, and that's China.
COSTELLO: Oh.
ROSENSWEIG: And with 1.3 billion Chinese people -- and they don't all have a car yet. Most of them still have a bicycle. But there's a tremendous increase, about 40 percent a year, of moving into a car and a tremendous increase in their use of steel and then steel for construction.
They've recently passed number -- Japan to be number two in the world and they're catching up on the U.S. in terms of oil consumption.
COSTELLO: So...
ROSENSWEIG: And I don't see them stopping.
COSTELLO: So if the demand continues to rise, could we see gas prices go even higher, despite what OPEC does?
ROSENSWEIG: We could because they have limited capacity at this point. One great thing, from our standpoint, about OPEC, is they always cheat on their agreements. They've been producing more than their agreement anyway. Now, they're adding a little bit. Like I said, yesterday, the ones who can throw in a little bit more. Saudi Arabia usually has a little bit excess capacity. So they're helping out. They're our ally and they want to remain our ally. They know we don't want to get mad at them. But at some point, they run out of their own supply -- they've got limited amounts -- whereas it's not just China at this point, although they're number one in terms of growth. India, as you've heard about, is growing so much. And they've got a billion people.
COSTELLO: Oh, I understand. The demand is going up and up.
But instead of following up on that, they turned around and blamed the oil companies for profiteering. Rosensweig did say that we should conserve, and that if Exxon lowered their prices, we'd all run out and buy Hummers...but nothing about what permanently high and climbing oil prices really mean.
If a person has not been introduced to the concept of Peak Oil and subsequently done some research ( assuming they are not already informed about oil politics and production ), the importance of Saudi Arabia's role as the swing producer likely is not understood. In a discussion of this nature on a news program, one would think that the responsibilty of both interviewer and interviewee would be to at least mention peak oil by name. One of the reasons I no longer watch television news is because of a lack of useful information delivered by CNN, etc.
It would not surprise me if Peak Oil is one of the subjects not approved for discussion by the ministry of truth, anyway.
Andy Serwer (editor of Fortune magazine and CNN correspondent) did mention peak oil by name, a couple of weeks ago on CNN's "In the Money" show. He said we might be at peak, right now. But he didn't seem at all concerned about it. I guess he's one of those that thinks the free market will solve the problem, and we'll make a seamless transition to renewables or nuclear.
Well spotted. It would make sense. The hemisphere of the euro is expanding very rapidly. Many of the oil producing countries (Iran, Irak, Russia) have switched from the unstable dollar to the more stable euro as a second currency so I guess they would like to be paid in the equivalent of euros as well.
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