Top Mining News - Oil Prices : This is the information about mining prices. As reported by LONDON (AFP), the increasing energy demand in the United States. This was said by traders. The complete information is as follows:
LONDON (AFP) – Oil prices rose on Friday on signs of increasing energy demand in the United States, traders said, as the market focus began switching to a meeting of the OPEC cartel next week.
New York’s main futures contract, light sweet crude for delivery in July, climbed 45 cents to 61.50 dollars a barrel.
Brent North Sea crude for July advanced 46 cents to 60.43 dollars.
Oil retreated Thursday, in line with global equities, as investors cashed in profits from a rally this week that had pushed prices to six-month highs above 62 dollars.
“Both markets are consolidating after recent gains and more sideways trading is to be expected just below recent highs, especially as we head into a quiet period of trading due to the long holiday weekend in the US and the UK,” said VTB Capital analyst Andrey Kryuchenkov.
Markets in both countries are closed Monday for public holidays.
Next Thursday meanwhile sees OPEC hold a meeting in Vienna to discuss whether to alter the amount of crude the cartel is pumping.
The Organization of Petroleum Exporting Countries, which pumps some 40 percent of global supply, has steadily cut production since late last year in a bid to steady prices which have tumbled from record highs above 147 dollars a barrel last July.
Libya’s envoy to OPEC, Shukri Ghanem, told AFP on Thursday that the meeting’s outcome remained uncertain as member nations had yet to indicate a clear stance.
“Everyone has not made up their minds. They are just watching carefully the movements in the market, the different signals,” he said.
The New York oil contract jumped to a six-month high 62.26 dollars on Wednesday after data showed a fall in key US oil inventories.
US crude reserves tumbled 2.1 million barrels in the week ending May 15, far more than market expectations for a 700,000 barrel drop.
“The bullish (positive) sign is that we’ve seen two consecutive weeks of falling inventories in the US,” Tony Nunan, an energy risk manager at Mitsubishi Corp, said Friday.
However, one analyst warned that current price levels were not in line with underlying weak global economic conditions.
“If you have a look at the fundamentals in the market at the moment, the inventories in the US are still at 19-year highs and there’s no real indication that demand has re-entered the market yet,” said Ben Westmore, an economist at the National Australia Bank.
Showing posts with label Oil Price. Show all posts
Showing posts with label Oil Price. Show all posts
Friday, May 22, 2009
Violence in oil-rich Nigeria boosts prices
Top Mining News - Oil prices : Here is the news on oil prices which is high because of rising violence in Nigeria’s ethnically driven civil war. The complete information is as follows:
With oil prices at a six-month high and gasoline prices not far behind, energy traders are pointing a finger at rising violence in Nigeria’s ethnically driven civil war.
A wave of attacks on oil wells, platforms and pipelines by rebels in Nigeria’s Niger Delta has left the country’s output at about half its maximum level of 3.2 million barrels a day, the government’s Minister of State for Petroleum Odein Ajumogobia told reporters in the capital, Abuja.
The spike in attacks follows a major military offensive in the resource-rich delta, where ethnic Ijaw militants are fighting for greater autonomy and a bigger share of oil revenues,.
The fighting demonstrates how remote and little-understood struggles can have dramatic effects on Americans’ daily lives. Nigeria is the fifth-largest foreign supplier of oil to the United States, meaning that disruptions there directly affect energy prices here.
JBC Energy, a Vienna, Austria-based firm, says concern over the renewed violence in Nigeria has contributed to a spike to $62 a barrel for oil - a six-month high. In the Washington area, gasoline prices in recent weeks have risen about 25 cents a gallon to an average of$2.30 for regular grade.
The Nigerian oil and gas industry has been operating at reduced capacity since the rebels began their campaign in earnest in 2006, and traders are worried about the potential for increased disruption.
“Over the last several years, [the rebels] have shown they have the capacity to severely disrupt oil production, not just in Delta state but in other states,” Mark Schroeder, director of sub-Saharan analysis at the global security firm Stratfor, told The Washington Times.
Last week, Nigerian government troops launched what they call “Operation Restore Hope,” aimed at rooting out rebel factions that operate under the umbrella of a group called MEND, or Movement for the Emancipation of the Niger Delta.
Local media say it is the federal government’s largest offensive in the area in years.
About 7,000 troops of the country’s Joint Task Force (JTF) are involved, backed by two warships and helicopter gunships, the Nigerian daily newspaper Vanguard reported. Their first target was a militant base known as Camp Five near the Delta state capital of Warri.
Source
With oil prices at a six-month high and gasoline prices not far behind, energy traders are pointing a finger at rising violence in Nigeria’s ethnically driven civil war.
A wave of attacks on oil wells, platforms and pipelines by rebels in Nigeria’s Niger Delta has left the country’s output at about half its maximum level of 3.2 million barrels a day, the government’s Minister of State for Petroleum Odein Ajumogobia told reporters in the capital, Abuja.
The spike in attacks follows a major military offensive in the resource-rich delta, where ethnic Ijaw militants are fighting for greater autonomy and a bigger share of oil revenues,.
The fighting demonstrates how remote and little-understood struggles can have dramatic effects on Americans’ daily lives. Nigeria is the fifth-largest foreign supplier of oil to the United States, meaning that disruptions there directly affect energy prices here.
JBC Energy, a Vienna, Austria-based firm, says concern over the renewed violence in Nigeria has contributed to a spike to $62 a barrel for oil - a six-month high. In the Washington area, gasoline prices in recent weeks have risen about 25 cents a gallon to an average of$2.30 for regular grade.
The Nigerian oil and gas industry has been operating at reduced capacity since the rebels began their campaign in earnest in 2006, and traders are worried about the potential for increased disruption.
“Over the last several years, [the rebels] have shown they have the capacity to severely disrupt oil production, not just in Delta state but in other states,” Mark Schroeder, director of sub-Saharan analysis at the global security firm Stratfor, told The Washington Times.
Last week, Nigerian government troops launched what they call “Operation Restore Hope,” aimed at rooting out rebel factions that operate under the umbrella of a group called MEND, or Movement for the Emancipation of the Niger Delta.
Local media say it is the federal government’s largest offensive in the area in years.
About 7,000 troops of the country’s Joint Task Force (JTF) are involved, backed by two warships and helicopter gunships, the Nigerian daily newspaper Vanguard reported. Their first target was a militant base known as Camp Five near the Delta state capital of Warri.
Source
Tuesday, May 12, 2009
The Recent Gains in Oil Prices as Trend Indicator
Top Mining News : This is the news on the trend of crude oil price which is increasing. This increas of crude oil price is considered positive by American Petro-Hunter, Inc. Here is the complete news.
American Petro-Hunter, Inc. views the recent price increases of crude oil as extremely positive news for both the economy and the Company. Last week, oil prices jumped to almost $58 a barrel thereby extending gains to near six-month highs on investor expectations that the global economic environment is beginning to grow and may begin to rebound before the end of the year.
Oil has broken above the relative trading range of approximately $45 to $55 a barrel that it’s been at since dropping from a record high of $147 last July. These gains are boosted by investor perceptions that the worst of a severe U.S. recession may be over. Governments across the world, led by the U.S. and China, have announced massive fiscal stimulus packages that should eventually spark economic growth and demand for commodities, said Francisco Blanch, head of global commodity research at Bank of America Merrill Lynch. In addition, Production cuts by the Organization of Petroleum Exporting Countries (OPEC) have helped bolster prices, and the cartel meets again on May 28 to discuss further possible output reductions. OPEC leaders have stated they want oil at $70 a barrel.
American Petro-Hunter’s management believes that a steady rise in the price of oil will occur throughout the year and that prices forecast to be above the $70 per barrel range are both realistic and even possibly conservative given the dramatic drop from last year’s record highs. With this in mind, the Company has moved quickly to secure its first oil acquisition, a low-risk conventional target in Kansas. As a further means of rapidly capitalizing upon the sectors encouraging growth indicators the Company is currently reviewing several promising production purchase scenarios in both the U.S. and Canada.
As announced previously, the Poston Prospect in Kansas targets productive oil formations within Mississippi Dolomite and/or Cherokee sands as indicated by significant 3D Seismic anomalies. The 750 acre block contains a potential multi well program with the first drilling location registered as the #1 Lutters Well. The operator of the project has reported that site preparations are fully underway with drill rig mobilization to the site planned within a week.
In the event of commercial production at the #1 Lutters Well an additional 2 to 3 offset locations are proposed in order to fully exploit the acreage. Engineering estimates of the potential production from the indicated pay zone is between 35 and 100 barrels per day from a successful well. Full development of the field could produce up to 400 BOPD of light oil. There is excellent support infrastructure and transportation access in the area which will easily and cost effectively facilitate regular storage tank transfers to nearby sales depots.
Saturday, April 4, 2009
The Return of the Obsolescing Bargain and the Decline of Big Oil: A Study of Bargaining in the Contemporary Oil Industry
This book centres on studying intricate bargaining relationships between the major actors in the highly politicised oil industry. By covering the period between 1998 and 2007, this study focuses exclusively on contemporary bargaining in the oil industry. In the current decade, which unlike previous two cooperative decades, can be characterised as conflictual, and thus politicised, the structure of the oil industry can best be understood by studying bargaining between numerous actors, the main of which are the international oil companies (IOCs), oil-exporting states, oil-importing states, and the national oil companies (NOCs). The central argument is that due to their weak relative bargaining power, the IOCs have been on the losing side in their bargaining with oil exporting countries and/or their NOCs in the current decade when compared to the late 1990s, and thus, we are witnessing the return of the obsolescing bargain. High oil prices, increased industry competition, lack of alternative investment options for IOCs, and an increasingly hostile political climate in many oil-exporting states are some of the main reasons why the IOCs are facing possibly unsurmountable hurdles.
Saturday, March 28, 2009
Oil Price News : "Natural gas, crude oil show some price stability" by BY ALEX MILLS
Top Mining News : This is the information on oil price stability entitled "Natural gas, crude oil show some price stability" by BY ALEX MILLS. The complete article can be read below.
A few market indicators point to a firmness in the price of crude oil and natural gas.
One of the largest factors is the U.S. economy. Even though unemployment has declined over the past year, it appears to have hit bottom. U.S. home sales register a comeback in December, registering the largest monthly increase in seven years. Could a rebound in auto sales be next?
Obviously, crude oil supply plays a very important role, and the largest exporter of crude oil is the 11members of the Organization of Petroleum Exporting Countries (OPEC). OPEC Secretary General Abdalla el-Badri predicted recently that OPEC may hit its new quotas by February 1. New cutbacks seek to reduce production by 4.2 million barrels per day, but other information indicates the decline in production is about 1.5 million barrels per day (27.65 million barrels per day in December to 26.15 million barrels per day today).
Even though U.S. crude oil supply is still in an oversupply position of about 46 million barrels, gasoline stocks are back in line indicating that consumers are beginning to drive more.
Natural gas, which is used primarily as an electric generation fuel, seems to have benefited from the cold weather that engulfed the Midwest and Eastern U.S. during the week of January 26. The implied net withdrawal for the week of 176 billion cubic feet is the largest yet this heating season, and significantly more than the 128 Bcf was withdrawn last year and 126 Bcf that has been withdrawn on average over the past five years (2004-2008), according to the Energy Information Administration (EIA).
While this withdrawal was the largest to date this heating season, it was still less than seasonal peak net withdrawals of more that 200 Bcf that have become common in recent years, EIA said.
The net withdrawal perhaps was lessened by reduced demand as a result of the current economic downturn and robust volumes from domestic production, EIA noted.
Also, production still is off peak because all of the hurricane damage has not been repaired yet.
However, unlike crude oil futures trading where prices are higher farther into the future, natural gas futures prices on the NYMEX last week were lower than the spot prices at the Henry Hub. This backwardation in the forward price curve provides an economic incentive to consume available supplies (including those in storage) rather than hold in storage for future use.
Watch for positive signs of increased consumption in China and India and increased demand for crude oil worldwide. The oil and gas exploration and production industry is just waiting for economic signs before it takes off, again.
Alex Mills is president of the Texas Alliance of Energy Producers. The opinions expressed are solely of the author and do not necessarily represent the opinions and or policies of the Texas Alliance.
source: here
Natural gas, crude oil show some price stability
by : BY ALEX MILLS
by : BY ALEX MILLS
A few market indicators point to a firmness in the price of crude oil and natural gas.
One of the largest factors is the U.S. economy. Even though unemployment has declined over the past year, it appears to have hit bottom. U.S. home sales register a comeback in December, registering the largest monthly increase in seven years. Could a rebound in auto sales be next?
Obviously, crude oil supply plays a very important role, and the largest exporter of crude oil is the 11members of the Organization of Petroleum Exporting Countries (OPEC). OPEC Secretary General Abdalla el-Badri predicted recently that OPEC may hit its new quotas by February 1. New cutbacks seek to reduce production by 4.2 million barrels per day, but other information indicates the decline in production is about 1.5 million barrels per day (27.65 million barrels per day in December to 26.15 million barrels per day today).
Even though U.S. crude oil supply is still in an oversupply position of about 46 million barrels, gasoline stocks are back in line indicating that consumers are beginning to drive more.
Natural gas, which is used primarily as an electric generation fuel, seems to have benefited from the cold weather that engulfed the Midwest and Eastern U.S. during the week of January 26. The implied net withdrawal for the week of 176 billion cubic feet is the largest yet this heating season, and significantly more than the 128 Bcf was withdrawn last year and 126 Bcf that has been withdrawn on average over the past five years (2004-2008), according to the Energy Information Administration (EIA).
While this withdrawal was the largest to date this heating season, it was still less than seasonal peak net withdrawals of more that 200 Bcf that have become common in recent years, EIA said.
The net withdrawal perhaps was lessened by reduced demand as a result of the current economic downturn and robust volumes from domestic production, EIA noted.
Also, production still is off peak because all of the hurricane damage has not been repaired yet.
However, unlike crude oil futures trading where prices are higher farther into the future, natural gas futures prices on the NYMEX last week were lower than the spot prices at the Henry Hub. This backwardation in the forward price curve provides an economic incentive to consume available supplies (including those in storage) rather than hold in storage for future use.
Watch for positive signs of increased consumption in China and India and increased demand for crude oil worldwide. The oil and gas exploration and production industry is just waiting for economic signs before it takes off, again.
Alex Mills is president of the Texas Alliance of Energy Producers. The opinions expressed are solely of the author and do not necessarily represent the opinions and or policies of the Texas Alliance.
source: here
Friday, February 20, 2009
Crude oil price drops sharply (UPI)
NEW YORK, Feb. 20 (UPI) -- Crude oil prices dropped sharply Friday to about $37 a barrel on the New York Mercantile Exchange, as prices fell from a strong rally in the previous session.
Crude oil price drops sharply (Moldova.org)
Crude oil prices dropped sharply Friday to about $37 a barrel on the New York Mercantile Exchange, as prices fell from a strong rally in the previous session.
Crude oil prices settled back in early trading, shedding $2.12 to $37.36 per barrel. Heating oil prices lost 0.0437 cents to $1.1608 per gallon. Reformulated blendstock gasoline fell 0.053 cents to $1.0456 per gallon. Natural gas prices
Crude oil prices settled back in early trading, shedding $2.12 to $37.36 per barrel. Heating oil prices lost 0.0437 cents to $1.1608 per gallon. Reformulated blendstock gasoline fell 0.053 cents to $1.0456 per gallon. Natural gas prices
Monday, October 27, 2008
The Troubles of Oil Proce
The cliff-like plunge of oil prices this fall has left customers who pre-paid for their winter supply crying the blues, and dealers are seeing red over the expensive oil languishing in their tanks.
And even customers who didn’t lock in rates appear to be suffering collateral damage, with prices staying high as dealers try to move their overpriced oil.
The cliff-like plunge of oil prices this fall has left customers who pre-paid for their winter supply crying the blues, and dealers are seeing red over the expensive oil languishing in their tanks.
And even customers who didn’t lock in rates appear to be suffering collateral damage, with prices staying high as dealers try to move their overpriced oil.
The cost of a barrel of oil fell to $64 during Friday’s trading, its lowest price in a year and less than half the $147 peak it hit in July. But there is a dark side to this otherwise bright spot in the economy: Those who thought they were exercising caution in July and August by locking in prices now find themselves paying a dollar more per gallon than the going rate.
“I didn’t pre-pay last year, and I got screwed,” said Tim, an oil customer in Dalton who asked that his last name — and the name of his oil supplier — not be used. “I did pre-pay this year, and I’m getting screwed.”
Every year, most oil dealers offer pre-pay and budget plans in the summer, allowing customers to lock in a rate for the coming heating season. Last year, pre-pay customers did well — many paid less than $2.70 a gallon and felt warm all over as oil prices jumped to more than $3 in the winter.
When customers lock in a rate, the dealer goes to the commodities market and essentially pre-buys the oil, agreeing to contracts to purchase tens of thousands of gallons at that predetermined price. When the plan works, everyone is happy: The dealer makes a reasonable profit and has the comfort of knowing his business will be steady. The customer saves money and has the peace of mind of knowing his price won’t soar.
When it doesn’t work — as appears to be the case this year — no one is happy.
A Berkshire County oil dealer who spoke on condition of anonymity described his predicament. He offered a pre-pay oil price of about $4.30 a gallon. Knowing that his customers would be less inclined to lock in at such a high price, he went to the commodities market and bought about half what he would normally buy. But when only a quarter of his customers pre-paid, he was stuck with the other half of that very expensive oil.
Now he has to make his money back while trying to compete with dealers who can offer a more current rate. To ease the pain, he can buy cheaper oil on the market now, blend the two, and set his price in between the high and low. But that means his prices aren’t dropping as fast as they could be.
“Everybody wants to be competitive, but it is tough to be competitive when you are losing a dollar a gallon,” he said.
A quick look at oil prices throughout the Berkshires suggests other dealers are faced with the same problem, keeping prices relative high as a result. According to data gathered by newenglandoil.com — which tracks prices throughout the region, including 10 dealers in the Berkshires — the average price per gallon on Friday was $3.25 in the county. In the Pioneer Valley, it was $2.71, and in the Framingham area, it was $3.07.
West Oil in North Adams was one of three companies offering $3.09 a gallon yesterday, the cheapest price in the Berkshires.
Like many dealers, owner Bob West said he found himself with excess pre-paid oil, but instead of trying to sell it to customers throughout the year, he went back to the commodities market and sold it all at once, taking a $300,000 loss.
“It hurts, but you have to look at it as two separate businesses,” he said. “You have your pre-pay business, and that price is locked in. Then you have your street business, and you have to have a fair price on the street.”
West said he knows the pre-pay customers aren’t happy. He tells them he isn’t making any extra in the deal and tries to explain how the market works.
“When you pre-pay, it’s like buying a scratch (lottery) ticket,” he said. “If you buy a $10 ticket and don’t win anything, you don’t go back into the store and ask for your money back.”
And even customers who didn’t lock in rates appear to be suffering collateral damage, with prices staying high as dealers try to move their overpriced oil.
The cliff-like plunge of oil prices this fall has left customers who pre-paid for their winter supply crying the blues, and dealers are seeing red over the expensive oil languishing in their tanks.
And even customers who didn’t lock in rates appear to be suffering collateral damage, with prices staying high as dealers try to move their overpriced oil.
The cost of a barrel of oil fell to $64 during Friday’s trading, its lowest price in a year and less than half the $147 peak it hit in July. But there is a dark side to this otherwise bright spot in the economy: Those who thought they were exercising caution in July and August by locking in prices now find themselves paying a dollar more per gallon than the going rate.
“I didn’t pre-pay last year, and I got screwed,” said Tim, an oil customer in Dalton who asked that his last name — and the name of his oil supplier — not be used. “I did pre-pay this year, and I’m getting screwed.”
Every year, most oil dealers offer pre-pay and budget plans in the summer, allowing customers to lock in a rate for the coming heating season. Last year, pre-pay customers did well — many paid less than $2.70 a gallon and felt warm all over as oil prices jumped to more than $3 in the winter.
When customers lock in a rate, the dealer goes to the commodities market and essentially pre-buys the oil, agreeing to contracts to purchase tens of thousands of gallons at that predetermined price. When the plan works, everyone is happy: The dealer makes a reasonable profit and has the comfort of knowing his business will be steady. The customer saves money and has the peace of mind of knowing his price won’t soar.
When it doesn’t work — as appears to be the case this year — no one is happy.
A Berkshire County oil dealer who spoke on condition of anonymity described his predicament. He offered a pre-pay oil price of about $4.30 a gallon. Knowing that his customers would be less inclined to lock in at such a high price, he went to the commodities market and bought about half what he would normally buy. But when only a quarter of his customers pre-paid, he was stuck with the other half of that very expensive oil.
Now he has to make his money back while trying to compete with dealers who can offer a more current rate. To ease the pain, he can buy cheaper oil on the market now, blend the two, and set his price in between the high and low. But that means his prices aren’t dropping as fast as they could be.
“Everybody wants to be competitive, but it is tough to be competitive when you are losing a dollar a gallon,” he said.
A quick look at oil prices throughout the Berkshires suggests other dealers are faced with the same problem, keeping prices relative high as a result. According to data gathered by newenglandoil.com — which tracks prices throughout the region, including 10 dealers in the Berkshires — the average price per gallon on Friday was $3.25 in the county. In the Pioneer Valley, it was $2.71, and in the Framingham area, it was $3.07.
West Oil in North Adams was one of three companies offering $3.09 a gallon yesterday, the cheapest price in the Berkshires.
Like many dealers, owner Bob West said he found himself with excess pre-paid oil, but instead of trying to sell it to customers throughout the year, he went back to the commodities market and sold it all at once, taking a $300,000 loss.
“It hurts, but you have to look at it as two separate businesses,” he said. “You have your pre-pay business, and that price is locked in. Then you have your street business, and you have to have a fair price on the street.”
West said he knows the pre-pay customers aren’t happy. He tells them he isn’t making any extra in the deal and tries to explain how the market works.
“When you pre-pay, it’s like buying a scratch (lottery) ticket,” he said. “If you buy a $10 ticket and don’t win anything, you don’t go back into the store and ask for your money back.”
The Financial Crisis of Iran because of Falling Oil Prices
Iran is being hurt by the financial crisis because of falling oil prices and a world downturn that will damage non-oil exports, an official said on Sunday, even though Iran’s economy was relatively isolated.
Iranian officials are voicing more concern about the impact of the international financial turmoil after initially brushing off the impact on Iran, which has an economy that has become increasingly isolated because of U.S. and U.N. sanctions.
Many Western banks have scaled back or cut dealings with Iran because of sanctions imposed over Iran’s disputed nuclear work. But the world’s fourth-largest oil producer has watched crude prices tumble and now expects to see other exports hurt.
“Even though the Iranian economy is to some extent less tied in to the world economy, the first impact (of the crisis) on the Iranian economy is a drop in the oil price,” Kamal Seyyed Ali, head of Iran’s export guarantee fund, said.
International crude prices have tumbled from $147 a barrel in July to around $65 a barrel on Friday. Some economists say Iran needs $70-$75 a barrel, or more, to balance its books.
In the comments reported on state radio, Seyyed Ali said a recession in the world economy would also hurt other exports.
“This issue constitutes a major challenge for the country’s non-oil exports,” he said.
Iran’s main exports aside from oil include carpets and pistachio nuts but they are relatively modest. Central bank figures for the year to March 2008 showed oil and gas exports at $81.8 billion compared with non-oil exports of $15.6 billion.
The government has ordered the economy, commerce and agriculture ministries to “evaluate the impact of the global financial crisis on the Iranian economy”, radio said. Each ministry has set up a committee to study the issue, it added.
Central Bank Governor Mahmoud Bahmani meets MPs on Sunday to explain the impact of the crisis, radio reported.
A central bank official has already said the drop in oil prices, a result of deepening global economic slowdown, rang an “alarm bell”. Former President Akbar Hashemi Rafsanjani said Iran should be prepared for the economic “tsunami”.
The impact of the crisis will add to the challenges facing President Mahmoud Ahmadinejad, who is expected to seek a second four-year term in the June 2009 presidential election.
His government is already under fire by critics for squandering Iran’s windfall oil earnings and making the economy increasingly dependent on crude. Critics say his spending spree is the reason inflation has soared to 29 percent.
Ahmadinejad took office in 2005 promising to spread Iran’s oil wealth more fairly.
Labour Minister Mohammad Jahromi said expansionary government policies of the past three years had given the state a bigger role, Sarmayeh newspaper reported on Sunday.
Iranian officials are voicing more concern about the impact of the international financial turmoil after initially brushing off the impact on Iran, which has an economy that has become increasingly isolated because of U.S. and U.N. sanctions.
Many Western banks have scaled back or cut dealings with Iran because of sanctions imposed over Iran’s disputed nuclear work. But the world’s fourth-largest oil producer has watched crude prices tumble and now expects to see other exports hurt.
“Even though the Iranian economy is to some extent less tied in to the world economy, the first impact (of the crisis) on the Iranian economy is a drop in the oil price,” Kamal Seyyed Ali, head of Iran’s export guarantee fund, said.
International crude prices have tumbled from $147 a barrel in July to around $65 a barrel on Friday. Some economists say Iran needs $70-$75 a barrel, or more, to balance its books.
In the comments reported on state radio, Seyyed Ali said a recession in the world economy would also hurt other exports.
“This issue constitutes a major challenge for the country’s non-oil exports,” he said.
Iran’s main exports aside from oil include carpets and pistachio nuts but they are relatively modest. Central bank figures for the year to March 2008 showed oil and gas exports at $81.8 billion compared with non-oil exports of $15.6 billion.
The government has ordered the economy, commerce and agriculture ministries to “evaluate the impact of the global financial crisis on the Iranian economy”, radio said. Each ministry has set up a committee to study the issue, it added.
Central Bank Governor Mahmoud Bahmani meets MPs on Sunday to explain the impact of the crisis, radio reported.
A central bank official has already said the drop in oil prices, a result of deepening global economic slowdown, rang an “alarm bell”. Former President Akbar Hashemi Rafsanjani said Iran should be prepared for the economic “tsunami”.
The impact of the crisis will add to the challenges facing President Mahmoud Ahmadinejad, who is expected to seek a second four-year term in the June 2009 presidential election.
His government is already under fire by critics for squandering Iran’s windfall oil earnings and making the economy increasingly dependent on crude. Critics say his spending spree is the reason inflation has soared to 29 percent.
Ahmadinejad took office in 2005 promising to spread Iran’s oil wealth more fairly.
Labour Minister Mohammad Jahromi said expansionary government policies of the past three years had given the state a bigger role, Sarmayeh newspaper reported on Sunday.
Thursday, October 23, 2008
Oil price plummets to USD 65.28 per barrel
“Daily Mining Exploration News on Crude Oil Price”—The price of oil plunged close to USD 65 per barrel here today, hitting a 17-month low after news that US energy stockpiles rose across the board last week, traders said.
The market was already facing intense selling pressure on renewed worries about energy demand in the face of slowing global growth and despite a likely OPEC output cut later this week, analysts said.
London’s Brent North Sea crude for December delivery tumbled to USD 65.28 per barrel, which was last seen on May 20, 2007.
New York’s main contract, light sweet crude for December, sank as low as USD 67.50 a barrel, which was last witnessed on June 27, 2007.
The US Department of Energy (DoE) revealed today that American crude oil reserves jumped 3.2 million barrels in the week ending October 17.
Gasoline or petrol inventories rose by 2.7 million barrels last week, the DoE added. The weekly US report is a central focus for the oil market because the United States is the biggest consumer of energy in the world.
Crude futures had gained some ground in recent sessions amid growing signals that OPEC is likely to cut production when the oil producers’ cartel meets in Vienna on Friday.
However, worries about weaker energy consumption as the world’s developed economies hit a weak patch have investors fretting, dealers said.
The market was already facing intense selling pressure on renewed worries about energy demand in the face of slowing global growth and despite a likely OPEC output cut later this week, analysts said.
London’s Brent North Sea crude for December delivery tumbled to USD 65.28 per barrel, which was last seen on May 20, 2007.
New York’s main contract, light sweet crude for December, sank as low as USD 67.50 a barrel, which was last witnessed on June 27, 2007.
The US Department of Energy (DoE) revealed today that American crude oil reserves jumped 3.2 million barrels in the week ending October 17.
Gasoline or petrol inventories rose by 2.7 million barrels last week, the DoE added. The weekly US report is a central focus for the oil market because the United States is the biggest consumer of energy in the world.
Crude futures had gained some ground in recent sessions amid growing signals that OPEC is likely to cut production when the oil producers’ cartel meets in Vienna on Friday.
However, worries about weaker energy consumption as the world’s developed economies hit a weak patch have investors fretting, dealers said.
What’s Really Wrong With the Price of Oil
“Daily Updated Mining & Exploration News on Crude Oil Price”—Back before the mortgage meltdown turned into the worstfinancial crisis since the Great Depression, the country’s big economic problem was energy. The presidential campaign was on fire over what to “do”? about the price of oil. Gas cost more than $4 a gallon, it was slowing down the economy, people were driving fewer miles and they were flying less. Believe it or not, this was an economic crisis that affected people who didn’t happen to be pinstriped bankers, hedge-fund managers or cabinet officials. You didn’t have to read the stock-market columns to know it was happening. Ordinary people started walking to town or skipping errands — taking the compact and not the S.U.V. Actually, I did that. And then, the price of oil plummeted, first because of slowing demand and recently amid panic selling during the credit crisis. And as it plunged more than 40 percent from its record high of $147 a barrel, the issue has faded.
Well, gas still costs $3.50 a gallon, and the price of a barrel of oil, last week close to $80, still is four times what it was all of six years ago. If that doesn’t sound like a big deal, consider that in the half-dozen years of the housing boom, residential home prices rose only 125 percent, whereas oil prices, even now, are 300 percent higher than they were six years ago. So the energy issue is still here. Remember the winter after Katrina, when home-heating-fuel prices caused an uproar? This winter they are likely to be much higher.
When the new president takes office, high energy costs will be — as they are already — a drag on the economy, one that is becoming conflated with the credit crisis. Last month, the U.S. auto industry sold fewer than one million cars — its slowest sales rate in 15 years. Tight credit and high gas prices each contributed to that. There is no way to completely unravel the two, but here is one fact: In the early part of this decade, when oil was cheap, Americans spent only 2 percent of their income on gasoline. Recently they have been spending about 4.5 percent — more than twice as much. And you can bet that the percentage is higher among families with lower incomes.
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What we should do about all this varies greatly according to your view of why gas prices went up. Various people who know the oil industry have been worrying for several years that global supplies were running low. Emerging (and populous) nations like China and India have been consuming more, and in many countries and for reasons varying from geology to politics, production was peaking or actually declining. So the supply-demand equation was getting squeezed on both ends. Last winter — when the price was in the neighborhood of $100 per barrel — John Hess, the chairman of Hess Corporation, told a conference of energy specialists, “An oil crisis is coming — in the next 10 years.”? Just in case the age of oil is truly ending, Hess, a medium-size oil company, is investing in fuel-cell technology, an alternative to gasoline. Richard Rainwater, the Texas investor who made billions buying oil stocks, shares the view that oil is scarce, and so doesWarren Buffett, the investor whom Wall Street has been dialing for rescue capital. “It’s supply and demand,”? Buffett told me. “The ability to produce 10 percent or 12 percent more than the world needed was there, and we got lulled into thinking — we just kept assuming — it would always be there. But there isn’t any tap to turn on now.”? (Disclosure: I own stock in Buffett’s company.)
Buffett said this during the summer, before high oil prices (and before the full force of the credit hurricane) slowed the world’s thirst for oil. Under current conditions, the oil “tap”? is not so dry, though presumably, economic activity will pick up someday and oil will become scarce again. Of course, this is if you believe that scarcity had anything to do with why the price rose in the first place.
There is also another, highly publicized view of the oil market. According to skeptics likeGeorge Soros and Michael Masters, a hedge-fund operator, the only thing wrong with the oil market is the market itself. Speculators, they say, drove the price away from its “fundamental”? value; worse, a new breed of institutional investor has been buying oil futures, hoarding the supply. Masters compares these investors to the Hunt brothers, the Texas billionaires who cornered the silver market in the late ’70s — until silver crashed and the Hunts landed in bankruptcy. Essentially, he says, the oil price is, or was, seriously “wrong”? — a distortion caused by traders that has little to do with the amount of oil being produced and consumed.
According to this view, oil traders are the culprits, as are the futures market and theCommodity Futures Trading Commission, the federal agency that regulates it. (The agency has also begun its own probe of the oil market.) Masters has fired off scores of e-mail messages to journalists and Wall Streeters, urging limits on speculators. (One message found its way to Senator Joe Lieberman.) Masters is not a disinterested party; his hedge fund has bet heavily on companies, like Delta Airlines, that have been punished by soaring oil prices. But his argument struck a populist chord. “Speculators are driving up the price of food and energy for everyone else,”? he told me. Shad Rowe, a Dallas money manager, says the situation raises the bigger question of “whether people in a complex society ought to be allowed to make bets that affect other people and that have nothing to do with them.”?
Of course, capitalism demands that people, or at least investors, make bets. That is how resources are allocated and money is invested where it is needed; high prices communicate scarcity. You could even say the oil market has performed a vital service to the country by telegraphing the need to conserve and to develop alternative supplies. The number of miles driven by Americans has declined, in recent months, by close to 5 percent. Consumers have abandoned S.U.V.’s, forcing Ford to speed up its plans to close truck factories and emphasize small cars. For similar reasons, General Motors and Chrysler are rushing to introduce electric cars. All of this is healthy, and none of it would have occurred in an environment of $20 oil. “Should speculators go to jail,”? notes Robert Barbera, chief economist with the Wall Street firm ITG, “or should they get the Congressional Medal of Honor?”?
In a sense, the question is whether we want to return to an era of plentiful oil and low prices — assuming it is possible — or to accept that political, geological and possibly environmental limitations will force us to diversify. The candidates, while talking tough about cutting our dependence on foreign oil, have supported some policies that seem inconsistent with that aim. Barack Obama has called for investment in alternative energy sources like wind and solar, and for ramping up production of cars that don’t rely on gasoline. John McCain has supported offshore drilling and nuclear power. Such policies are responsive to the idea that energy, oil in particular, is a scarce resource. And a higher oil price is the most persuasive lobby for all of them. But on the stump, each candidate has inveighed against high gasoline prices — as if prices were the problem, rather than a useful, albeit painful, signal that conventional supplies are running low. Obama supports a windfall tax on oil-company profits, a nonsolution that would discourage drilling and potentially worsen future shortages. (An Obama campaign flier asserts, “While you’re running on empty, Exxon made $4 billion in one month.”?) McCain advocated a temporary repeal of the gas tax — a measure that would do the most to revive Americans’ love affair with big cars.
Well, gas still costs $3.50 a gallon, and the price of a barrel of oil, last week close to $80, still is four times what it was all of six years ago. If that doesn’t sound like a big deal, consider that in the half-dozen years of the housing boom, residential home prices rose only 125 percent, whereas oil prices, even now, are 300 percent higher than they were six years ago. So the energy issue is still here. Remember the winter after Katrina, when home-heating-fuel prices caused an uproar? This winter they are likely to be much higher.
When the new president takes office, high energy costs will be — as they are already — a drag on the economy, one that is becoming conflated with the credit crisis. Last month, the U.S. auto industry sold fewer than one million cars — its slowest sales rate in 15 years. Tight credit and high gas prices each contributed to that. There is no way to completely unravel the two, but here is one fact: In the early part of this decade, when oil was cheap, Americans spent only 2 percent of their income on gasoline. Recently they have been spending about 4.5 percent — more than twice as much. And you can bet that the percentage is higher among families with lower incomes.
ADVERTISEMENT
What we should do about all this varies greatly according to your view of why gas prices went up. Various people who know the oil industry have been worrying for several years that global supplies were running low. Emerging (and populous) nations like China and India have been consuming more, and in many countries and for reasons varying from geology to politics, production was peaking or actually declining. So the supply-demand equation was getting squeezed on both ends. Last winter — when the price was in the neighborhood of $100 per barrel — John Hess, the chairman of Hess Corporation, told a conference of energy specialists, “An oil crisis is coming — in the next 10 years.”? Just in case the age of oil is truly ending, Hess, a medium-size oil company, is investing in fuel-cell technology, an alternative to gasoline. Richard Rainwater, the Texas investor who made billions buying oil stocks, shares the view that oil is scarce, and so doesWarren Buffett, the investor whom Wall Street has been dialing for rescue capital. “It’s supply and demand,”? Buffett told me. “The ability to produce 10 percent or 12 percent more than the world needed was there, and we got lulled into thinking — we just kept assuming — it would always be there. But there isn’t any tap to turn on now.”? (Disclosure: I own stock in Buffett’s company.)
Buffett said this during the summer, before high oil prices (and before the full force of the credit hurricane) slowed the world’s thirst for oil. Under current conditions, the oil “tap”? is not so dry, though presumably, economic activity will pick up someday and oil will become scarce again. Of course, this is if you believe that scarcity had anything to do with why the price rose in the first place.
There is also another, highly publicized view of the oil market. According to skeptics likeGeorge Soros and Michael Masters, a hedge-fund operator, the only thing wrong with the oil market is the market itself. Speculators, they say, drove the price away from its “fundamental”? value; worse, a new breed of institutional investor has been buying oil futures, hoarding the supply. Masters compares these investors to the Hunt brothers, the Texas billionaires who cornered the silver market in the late ’70s — until silver crashed and the Hunts landed in bankruptcy. Essentially, he says, the oil price is, or was, seriously “wrong”? — a distortion caused by traders that has little to do with the amount of oil being produced and consumed.
According to this view, oil traders are the culprits, as are the futures market and theCommodity Futures Trading Commission, the federal agency that regulates it. (The agency has also begun its own probe of the oil market.) Masters has fired off scores of e-mail messages to journalists and Wall Streeters, urging limits on speculators. (One message found its way to Senator Joe Lieberman.) Masters is not a disinterested party; his hedge fund has bet heavily on companies, like Delta Airlines, that have been punished by soaring oil prices. But his argument struck a populist chord. “Speculators are driving up the price of food and energy for everyone else,”? he told me. Shad Rowe, a Dallas money manager, says the situation raises the bigger question of “whether people in a complex society ought to be allowed to make bets that affect other people and that have nothing to do with them.”?
Of course, capitalism demands that people, or at least investors, make bets. That is how resources are allocated and money is invested where it is needed; high prices communicate scarcity. You could even say the oil market has performed a vital service to the country by telegraphing the need to conserve and to develop alternative supplies. The number of miles driven by Americans has declined, in recent months, by close to 5 percent. Consumers have abandoned S.U.V.’s, forcing Ford to speed up its plans to close truck factories and emphasize small cars. For similar reasons, General Motors and Chrysler are rushing to introduce electric cars. All of this is healthy, and none of it would have occurred in an environment of $20 oil. “Should speculators go to jail,”? notes Robert Barbera, chief economist with the Wall Street firm ITG, “or should they get the Congressional Medal of Honor?”?
In a sense, the question is whether we want to return to an era of plentiful oil and low prices — assuming it is possible — or to accept that political, geological and possibly environmental limitations will force us to diversify. The candidates, while talking tough about cutting our dependence on foreign oil, have supported some policies that seem inconsistent with that aim. Barack Obama has called for investment in alternative energy sources like wind and solar, and for ramping up production of cars that don’t rely on gasoline. John McCain has supported offshore drilling and nuclear power. Such policies are responsive to the idea that energy, oil in particular, is a scarce resource. And a higher oil price is the most persuasive lobby for all of them. But on the stump, each candidate has inveighed against high gasoline prices — as if prices were the problem, rather than a useful, albeit painful, signal that conventional supplies are running low. Obama supports a windfall tax on oil-company profits, a nonsolution that would discourage drilling and potentially worsen future shortages. (An Obama campaign flier asserts, “While you’re running on empty, Exxon made $4 billion in one month.”?) McCain advocated a temporary repeal of the gas tax — a measure that would do the most to revive Americans’ love affair with big cars.
Some rue inking heating Crude oil contracts at top price
“Daily Updated Mining & Exploration News on Crude Oil Price”—Some New England residents who pre-bought heating oil or signed price cap contracts for the fuel in June or July are regretting that now.
Oil prices averaged more than $4.50 a gallon around the region in June and July, the traditional month for locking in supplies — and prices — for the following winter.
But since then, prices have dropped by more than 25 percent, making many of those contracts signed in June and July look like a bad deal.
Despite that, state officials say consumers are stuck and will be required to honor contracts. And oil dealers note that they respond to consumers demanding pre-buy and fixed-price deals by signing up for oil from their wholesalers at the then prevailing prices.
Oil prices averaged more than $4.50 a gallon around the region in June and July, the traditional month for locking in supplies — and prices — for the following winter.
But since then, prices have dropped by more than 25 percent, making many of those contracts signed in June and July look like a bad deal.
Despite that, state officials say consumers are stuck and will be required to honor contracts. And oil dealers note that they respond to consumers demanding pre-buy and fixed-price deals by signing up for oil from their wholesalers at the then prevailing prices.
OPEC faces tough test as oil price tumbles
“Daily Updated Mining & Exploration News on Crude Oil Price”—At the beginning of the year, OPEC producers felt confident that strong economic growth and tight supplies would keep oil prices high. When oil crossed the $100-a-barrel threshold in February, the cartel’s president blamed speculators and said there was not much OPEC could do.
But now, panic is gripping producers as prices drop. Oil is down by half since July, and the speed of the decline has stunned oil-rich governments that have become dependent on high prices.
As the global economy continues to weaken, the Organization of the Petroleum Exporting Countries faces its toughest test in years.
The problem for the oil exporters, who meet for an emergency session in Vienna on Friday, is to find a way to stop the price drop at a time when oil consumption is falling markedly in industrialized countries. Even the Chinese economy, long the biggest engine of growth for oil demand, seems to be cooling.
Most analysts expect the group to announce a production cut of at least a million barrels a day, which would be more than 1 percent of the world oil supply. Chakib Khelil, OPEC’s president, said last week that an output cut was “obvious” and suggested the group might meet often in coming months for further adjustments.History suggests that OPEC will face a tough time propping up prices as oil consumption slows and the world teeters on the edge of a global recession, analysts said. Some experts warn that if the cartel took too much oil off the market, it could push prices up so much as to worsen the global economic crisis.
“OPEC’s problem is they don’t know how much demand is falling,” said Jan Stuart, an energy economist at UBS. “So the risk they run is either they don’t do enough, or they do too much. That’s a tough choice.”
Nobuo Tanaka, the executive director of the International Energy Agency, said a cut in production could harm consumers and delay an economic recovery. “The slowdown may be prolonged,” Tanaka told reporters on Monday in Paris, where the energy agency, which advises industrialized countries, is based.
Oil prices settled at $70.89 a barrel on Tuesday, down $3.36 and near the 14-month low they reached last week.
The biggest question is what price the cartel is prepared to defend. In 2000, producers adopted a price band of $22 to $28 a barrel, and adjusted production levels accordingly. The mechanism was imperfect, and many producers felt it constrained them, but it basically worked to ensure stability in oil markets.
But defending a price requires spare capacity, so that production can be raised if prices get too high, as well as discipline on the part of OPEC members, so that production can be lowered when prices fall. OPEC abandoned its price band when its spare capacity virtually disappeared in 2005 amid rapidly rising global oil demand.
Now, with consumption growth slowing sharply and new oil projects coming online, some spare capacity has become available.
Lawrence Eagles, an oil analyst at JPMorgan, said in a research note that he believes the “price-band mechanism offers the best way for OPEC to manage the market under current conditions.” Eagles said OPEC did not want prices to slip below $70 a barrel, and would be more comfortable with prices around $80.
The cartel, which controls 40 percent of the world’s oil exports, has found it difficult in the past to get all its members to abide by production cuts. When prices fall, producers have an incentive to increase their output to maximize revenue, not stick with OPEC quotas.
Producers are aware that high prices pose a risk to the global economy. Oil consumption is already falling sharply in developed countries, and there is a rising risk that oil demand could slow even in fast-growing developing nations.
OPEC’s researchers recently downgraded their forecasts for global oil demand because of the financial crisis. OPEC expects global demand to rise 550,000 barrels a day this year, to 86.5 million barrels a day.
For many analysts, these expectations are still too optimistic. A growing number of independent experts now say they believe that global oil consumption may fall this year, for the first time since 1993.
“OPEC will have to decide how far it can ignore the global economic crisis and pressure from consuming countries,” wrote researchers at the Center for Global Energy Studies, a London consulting group founded by Sheik Ahmed Zaki Yamani, a former Saudi oil minister. “The real danger is that a big cut will send prices soaring again, putting the global economy at even greater risk.”
But now, panic is gripping producers as prices drop. Oil is down by half since July, and the speed of the decline has stunned oil-rich governments that have become dependent on high prices.
As the global economy continues to weaken, the Organization of the Petroleum Exporting Countries faces its toughest test in years.
The problem for the oil exporters, who meet for an emergency session in Vienna on Friday, is to find a way to stop the price drop at a time when oil consumption is falling markedly in industrialized countries. Even the Chinese economy, long the biggest engine of growth for oil demand, seems to be cooling.
Most analysts expect the group to announce a production cut of at least a million barrels a day, which would be more than 1 percent of the world oil supply. Chakib Khelil, OPEC’s president, said last week that an output cut was “obvious” and suggested the group might meet often in coming months for further adjustments.History suggests that OPEC will face a tough time propping up prices as oil consumption slows and the world teeters on the edge of a global recession, analysts said. Some experts warn that if the cartel took too much oil off the market, it could push prices up so much as to worsen the global economic crisis.
“OPEC’s problem is they don’t know how much demand is falling,” said Jan Stuart, an energy economist at UBS. “So the risk they run is either they don’t do enough, or they do too much. That’s a tough choice.”
Nobuo Tanaka, the executive director of the International Energy Agency, said a cut in production could harm consumers and delay an economic recovery. “The slowdown may be prolonged,” Tanaka told reporters on Monday in Paris, where the energy agency, which advises industrialized countries, is based.
Oil prices settled at $70.89 a barrel on Tuesday, down $3.36 and near the 14-month low they reached last week.
The biggest question is what price the cartel is prepared to defend. In 2000, producers adopted a price band of $22 to $28 a barrel, and adjusted production levels accordingly. The mechanism was imperfect, and many producers felt it constrained them, but it basically worked to ensure stability in oil markets.
But defending a price requires spare capacity, so that production can be raised if prices get too high, as well as discipline on the part of OPEC members, so that production can be lowered when prices fall. OPEC abandoned its price band when its spare capacity virtually disappeared in 2005 amid rapidly rising global oil demand.
Now, with consumption growth slowing sharply and new oil projects coming online, some spare capacity has become available.
Lawrence Eagles, an oil analyst at JPMorgan, said in a research note that he believes the “price-band mechanism offers the best way for OPEC to manage the market under current conditions.” Eagles said OPEC did not want prices to slip below $70 a barrel, and would be more comfortable with prices around $80.
The cartel, which controls 40 percent of the world’s oil exports, has found it difficult in the past to get all its members to abide by production cuts. When prices fall, producers have an incentive to increase their output to maximize revenue, not stick with OPEC quotas.
Producers are aware that high prices pose a risk to the global economy. Oil consumption is already falling sharply in developed countries, and there is a rising risk that oil demand could slow even in fast-growing developing nations.
OPEC’s researchers recently downgraded their forecasts for global oil demand because of the financial crisis. OPEC expects global demand to rise 550,000 barrels a day this year, to 86.5 million barrels a day.
For many analysts, these expectations are still too optimistic. A growing number of independent experts now say they believe that global oil consumption may fall this year, for the first time since 1993.
“OPEC will have to decide how far it can ignore the global economic crisis and pressure from consuming countries,” wrote researchers at the Center for Global Energy Studies, a London consulting group founded by Sheik Ahmed Zaki Yamani, a former Saudi oil minister. “The real danger is that a big cut will send prices soaring again, putting the global economy at even greater risk.”
Big price drops hit heating oil market
“Daily Updated Mining & Exploration News on Crude Oil Price”— Many people who signed up for their winter’s supply of heating oil in June or July are regretting the prices they agreed to now. Big price declines have hit the market.
Below is a listing of average per-gallon prices of No. 2 home heating oil in the six New England states in July, versus the most recent available.
- Connecticut: $4.50 on July 15; $3.25 on Oct. 15.
- Maine: $4.71 on July 7; $3.08 on Oct. 20.
- Massachusetts: $4.71 on July 8; $3.14 on Oct. 21.
- New Hampshire: $4.74 on July 14; $3.34 on Oct. 20.
- Rhode Island: $4.75 on July 14; $3.25 on Oct. 14.
- Vermont, which reports monthly: $4.65 in July; $4.13 in September.
Below is a listing of average per-gallon prices of No. 2 home heating oil in the six New England states in July, versus the most recent available.
- Connecticut: $4.50 on July 15; $3.25 on Oct. 15.
- Maine: $4.71 on July 7; $3.08 on Oct. 20.
- Massachusetts: $4.71 on July 8; $3.14 on Oct. 21.
- New Hampshire: $4.74 on July 14; $3.34 on Oct. 20.
- Rhode Island: $4.75 on July 14; $3.25 on Oct. 14.
- Vermont, which reports monthly: $4.65 in July; $4.13 in September.
Big price drops hit heating oil market
“Daily Updated Mining & Exploration News on Crude Oil Price”— Many people who signed up for their winter’s supply of heating oil in June or July are regretting the prices they agreed to now. Big price declines have hit the market.
Below is a listing of average per-gallon prices of No. 2 home heating oil in the six New England states in July, versus the most recent available.
- Connecticut: $4.50 on July 15; $3.25 on Oct. 15.
- Maine: $4.71 on July 7; $3.08 on Oct. 20.
- Massachusetts: $4.71 on July 8; $3.14 on Oct. 21.
- New Hampshire: $4.74 on July 14; $3.34 on Oct. 20.
- Rhode Island: $4.75 on July 14; $3.25 on Oct. 14.
- Vermont, which reports monthly: $4.65 in July; $4.13 in September
Below is a listing of average per-gallon prices of No. 2 home heating oil in the six New England states in July, versus the most recent available.
- Connecticut: $4.50 on July 15; $3.25 on Oct. 15.
- Maine: $4.71 on July 7; $3.08 on Oct. 20.
- Massachusetts: $4.71 on July 8; $3.14 on Oct. 21.
- New Hampshire: $4.74 on July 14; $3.34 on Oct. 20.
- Rhode Island: $4.75 on July 14; $3.25 on Oct. 14.
- Vermont, which reports monthly: $4.65 in July; $4.13 in September
Monday, October 13, 2008
OPEC Statement on The Bearish Sentiment in the Oil Market
SAN FRANCISCO — Without a quick end to the financial market crises and improvement in the global economic outlook, the bearish sentiment in the oil market is likely to continue, OPEC said Saturday in a statement to the International Monetary Fund at its annual meeting in Washington, D.C.
SAN FRANCISCO — Without a quick end to the financial market crises and improvement in the global economic outlook, the bearish sentiment in the oil market is likely to continue, OPEC said Saturday in a statement to the International Monetary Fund at its annual meeting in Washington, D.C.
Media reports cited Mohammad Alipour-Jeddi, head of the Petroleum Studies Department of the Organization of Petroleum Exporting Countries, as saying that the U.S. financial crisis and continued deterioration in the world economy is likely to sustain a bearish oil market and pose a risk of oversupply in the first half of 2009.
“The shift to bearish market sentiment has been precipitated by a growing awareness of weakening oil market fundamentals, due to deteriorating economic prospects, an associated decline in oil demand growth and the healthy supply situation primarily from increased OPEC production,” he said in the statement.
Agence-France Presse reported Sunday that Iran predicted that OPEC would cut its oil output at its November meeting.
It cited an Iranian state-media report quoting Mohammad Ali Khatibi, Iran’s OPEC representative, as saying the OPEC would likely seek the cut “in order to balance supply and demand.”
OPEC’s Alipour-Jeddi said in the Saturday statement that existing regulations have proved “insufficient to properly contain the negative impact of speculative activity in the market, which highlights the need to consider further measures.”
He called for the extension of U.S. Commodity Futures Trading Commission monitoring procedures to the other regulated exchanges and the unregulated over-the-counter market and suggested ending regulatory loopholes that allow speculative positions to exceed existing limits
SAN FRANCISCO — Without a quick end to the financial market crises and improvement in the global economic outlook, the bearish sentiment in the oil market is likely to continue, OPEC said Saturday in a statement to the International Monetary Fund at its annual meeting in Washington, D.C.
Media reports cited Mohammad Alipour-Jeddi, head of the Petroleum Studies Department of the Organization of Petroleum Exporting Countries, as saying that the U.S. financial crisis and continued deterioration in the world economy is likely to sustain a bearish oil market and pose a risk of oversupply in the first half of 2009.
“The shift to bearish market sentiment has been precipitated by a growing awareness of weakening oil market fundamentals, due to deteriorating economic prospects, an associated decline in oil demand growth and the healthy supply situation primarily from increased OPEC production,” he said in the statement.
Agence-France Presse reported Sunday that Iran predicted that OPEC would cut its oil output at its November meeting.
It cited an Iranian state-media report quoting Mohammad Ali Khatibi, Iran’s OPEC representative, as saying the OPEC would likely seek the cut “in order to balance supply and demand.”
OPEC’s Alipour-Jeddi said in the Saturday statement that existing regulations have proved “insufficient to properly contain the negative impact of speculative activity in the market, which highlights the need to consider further measures.”
He called for the extension of U.S. Commodity Futures Trading Commission monitoring procedures to the other regulated exchanges and the unregulated over-the-counter market and suggested ending regulatory loopholes that allow speculative positions to exceed existing limits
Sunday, October 12, 2008
The Prize : The Epic Quest for Oil, Money & Power
Energy consultant Yergin limns oil's central role in most of the wars and many international crises of the 20th century. "A timely, information-packed, authoritative history of the petroleum industry, tracing its ramifications, national and geopolitical, to the present day," said PW. Photos. Author tour.
Copyright 1991 Reed Business Information, Inc.
Review: J. Minatel "jimmin"
The Prize is one of the best books I've ever read. I wish I could give it a couple of bonus stars in my rating here.
You'd really be selling this book short to think of it just as a history of oil, the oil business, and oil politics in the middle east. Even that would have been an ambitious book but Yergin makes it so much more. It honestly is a thorough history of the entire 20th century (sans the 90s) viewed through the perspective of the oil industry.
As each chapter, era, decade, and war unfolds in Yergin's story, you'll gain a much better understanding of the roots of many of the US public's stances on big business, anti-trust legislation, and other pivotal issues of the last 100 years. You'll see how pivotal energy resources were in shaping the planning and rationale for 2 world wars and how the ready availability or lack of oil played as much of a role in winning and losing those wars as did battlefield strategies and the valor of the millions of soldiers involved. You'll see the role oil and energy played in the final collapse of the great imperial powers.
Probably most relevant to 2007, the lessons Yergin teaches about middle east history, the changing power roles the evolved in the last 50-60 years as the power shifted from the oil companies to the oil producing countries. Tracing the roots of nationalization of oil production in Mexico and Venezuela is a great stepping stone to understanding out current relationship with Venezuela but it also properly frames the story of the origins of OPEC and OPEC policies. And it's so important to get a understanding of the power plays, who's who, back room deals, and longstanding rivalries that built and reinforced the animosity that so many in the middle east felt and feel toward the US and other western and oil consuming countries.
It also traces the missteps and failed attempts at alternative energy sources as far back as the turn of the 19th century, including how alternative sources for aviation fuel provided the German Luftwaffe almost enough fuel to keep going in WWII. And it's easy to see how most other western nations have failed miserably to make the alternative fuel investments that might have paid those same kind of dividends.
The history of how many relations between nations were built on the personal charisma and power of individual leaders is also a powerful lesson for the future when you look at what happens to those relationships when the leader falls or is removed from power. Yergin's tracing of the entire story of the rise and exile of the Shah of Iran is must reading as western leaders might all be thinking while middle eastern leaders and families might be in danger of falling to that same fate and what effect that would have on our immediate oil supplies.
Any western reader and especially readers in the US should look at Yergin's perspective on the fall of the British empire as partially a failure to efficiently transition from a coal economy (coal being a resource England was rich in) to an oil economy (oil being scarce in the British empire until the North Sea discoveries at which time it was really to late to matter). When the US oil balance tipped from exporter to importer and as that balance swings even more out of whack, US readers have to be forced to ask themselves, how long can the US sustain as a world power while exporting so many dollars in exchange for oil and even worse, how ill prepared we could be for a scarcity of oil 25, 50, or 70 years from now. The oil producing nations all recognized 50 or more years ago that their oil revenue would only last so long, that there are only so many decades worth of oil to pump out of the ground at a given pace, and that it was in their interest to maximize the revenue from each barrel pumped. The US and other consumers need to make the corollary discovery: that there is only such much oil to be had and we need to maximize the use and benefit out of each barrel pumped.
Fanatically, even though it covers all this ground, all these disparate topics, Yergin's writing is still incredibly readable and the story well put together. It's hard to imagine a history book that is a "page turner" but this one really is.
In short, if you haven't read this, you should. Maybe if every member of the US House and Senate and all the President's advisors would read this, a few light bulbs would turn on (compact fluorescent energy saving bulbs of course) regarding our energy and foreign policies.
Monday, August 25, 2008
The increase of Crude Oil Price until $113.63/Barrel - OPEC News
Rising $3.86 on Thursday, the price for crude oil produced by OPEC jumped back above the $110-mark, data issued by OPEC showed on Friday.
One barrel (159 liters) of OPEC-produced crude stood at $113.63 Thursday, compared with $109.77 on the previous day.
Oil prices were pushed by concerns about rising tensions between the United States and oil producer Russia, Vienna-based energy consultants JBC said.
OPEC calculates an average basket price based on 13 important brands produced by cartel members.
One barrel (159 liters) of OPEC-produced crude stood at $113.63 Thursday, compared with $109.77 on the previous day.
Oil prices were pushed by concerns about rising tensions between the United States and oil producer Russia, Vienna-based energy consultants JBC said.
OPEC calculates an average basket price based on 13 important brands produced by cartel members.
The Increse of Gas Price as Bad News for Motorists
There’s bad news for motorists who are hoping for one last jaunt of the summer: AAA Auto Club South said Sunday that they expect gasoline prices to increase before Labor Day weekend.
In its weekly fuel briefing, AAA cited higher crude oil prices, reduced domestic fuel inventories and a weaker dollar as factors that could push pump prices higher this week.
“Tensions with Russia, Georgia, Iran? and a weaker U.S. dollar gave pause to the five-week decline in crude oil prices,” Randy Bly, director of community relations for AAA Auto Club South, said in a written statement. “Traders are concerned that OPEC may decide to decrease crude oil production at their next meeting in September. The U.S. Department of Energy is reporting below average gasoline inventories and U.S. refineries have decreased output in response to lower demand, to date. With Labor Day Weekend approaching, we can expect an increase in fuel consumption but a slightly lower gasoline inventory. That’s why prices may go up.”
The average price for a gallon of regular unleaded gasoline in Florida on Sunday was $3.69, compared with $3.74 last week. Last year, Florida motorists were paying an average of $2.72 per gallon for gasoline.
Nationally, the average price for gasoline was also $3.69, compared with $3.75 last week and $2.76 a year ago.
In its weekly fuel briefing, AAA cited higher crude oil prices, reduced domestic fuel inventories and a weaker dollar as factors that could push pump prices higher this week.
“Tensions with Russia, Georgia, Iran? and a weaker U.S. dollar gave pause to the five-week decline in crude oil prices,” Randy Bly, director of community relations for AAA Auto Club South, said in a written statement. “Traders are concerned that OPEC may decide to decrease crude oil production at their next meeting in September. The U.S. Department of Energy is reporting below average gasoline inventories and U.S. refineries have decreased output in response to lower demand, to date. With Labor Day Weekend approaching, we can expect an increase in fuel consumption but a slightly lower gasoline inventory. That’s why prices may go up.”
The average price for a gallon of regular unleaded gasoline in Florida on Sunday was $3.69, compared with $3.74 last week. Last year, Florida motorists were paying an average of $2.72 per gallon for gasoline.
Nationally, the average price for gasoline was also $3.69, compared with $3.75 last week and $2.76 a year ago.
The increase of Oil Price news : "Rises to near $117 as Investors Eye Falling US Gasoline Inventories, OPEC Meeting
Oil prices rose Thursday above $116 a barrel as investors considered a fall in U.S. gasoline inventories and a possible output tightening by OPEC at its next meeting in September.
By midday in Europe, light, sweet crude for October delivery was up $1.37 at $116.93 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.01 overnight to settle at $115.56 a barrel.
The September contract expired Wednesday after rising 45 cents to $114.98 a barrel.
In London, October Brent crude rose $1.47 to $115.83 a barrel on the ICE Futures exchange.
The price gains came despite a huge rise in U.S. crude inventories. But not all U.S. fuel supplies were abundant.
Gasoline inventories shrank by a larger-than-expected 6.2 million barrels to below-average levels in the week ended Aug. 15, the U.S. Energy Department’s Energy Information Administration said Wednesday. Meanwhile, distillate inventories — which include heating oil and diesel fuel — rose by less than expected, the EIA said.
That was enough to offset a hefty 9.4 million barrel rise in U.S. crude stocks last week when the average analyst forecast had been for a 1.7 million barrel increase, according to energy information provider Platts.
“That report had something for everyone,” said David Moore, a commodity strategist at Commonwealth Bank of Australia in Sydney. “On the one hand, the crude inventory buildup was quite strong, but the gasoline draw was also very prominent.”
Investors are also trying to anticipate the outcome of the next Organization of Petroleum Exporting Countries meeting in early September, as supply concerns could rise further if members of the cartel decide to lower their output in response to slower demand. Venezuelan Oil Minister Rafael Ramirez said he might propose an output cut at the next OPEC meeting.
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