Oil price discussion and analysis

[numbercruncher]

Re: OIL AGAIN!

Canadians starting to hook into the Oil sands now, very profitable seen as oil is way out there now a days !

Feb. 6, 2008

Resource Extraction

Suncor drops $20 billion into oilsands project

Crude oil production is expected to begin ramping up in late 2011, with full production capacity of 550,000 bpd expected to be achieved in 2012.

http://www.journalofcommerce.com/article/id26303

Alberta Government calculates that about 28 billion cubic metres (174 billion barrels) of crude bitumen are economically recoverable from the three Alberta oil sands areas at current prices using current technology. This is equivalent to about 10% of the estimated 1,700 and 2,500 billion barrels of bitumen in place

This volume places Canadian proven oil reserves second in the world behind those of Saudi Arabia.

The Alberta estimates in some ways are extremely conservative, since they assume a recovery rate of around 20% of bitumen in place, whereas oil companies using the new steam assisted gravity drainage (SAGD) method of extracting bitumen report that they can recover over 60% with little effort. These much higher recovery rates probably mean that the ultimate production could be several times as high as the already very large government estimates.

http://en.wikipedia.org/wiki/Athabasca_Tar_Sands

Well doesnt seem like we will run out of Oil in our lifetimes, combined with the vast array of alternatives such as Biofuel, Increased efficency, electric, Air, Hydrogen etc, nothing to worry about, still could see price shocks when production doesnt keep up, but safe in the knowledge we will never run out, kind of puts a downer on Peak Oil (for now), Peak Production is the problem if all the alternatives dont come online in time I guess!

 

[Wysiwyg]

Re: OIL AGAIN!

Well doesnt seem like we will run out of Oil in our lifetimes, combined with the vast array of alternatives such as Biofuel, Increased efficency, electric, Air, Hydrogen etc, nothing to worry about, still could see price shocks when production doesnt keep up, but safe in the knowledge we will never run out, kind of puts a downer on Peak Oil (for now), Peak Production is the problem if all the alternatives dont come online in time I guess!

Synthetic substitutes/additions may be the path taken.I`m sure the boffins will be working on a substitute lubricant to ultimately replace mineral oil.

One form of synthetic oil is that manufactured using the Fischer-Tropsch process which converts carbon dioxide, carbon monoxide, and methane into liquid hydrocarbons of various forms. This process was developed and used extensively in World War II by Germany, which had limited access to crude oil supplies. Germany's yearly synthetic oil production reached millions of tons in 1944. It is today used in South Africa to produce most of that country's diesel.

 

[rederob]

Re: OIL AGAIN!

It's not a matter of running out of oil.
It's a matter of supply becoming only a small fraction of demand.
Anyone thinking that oil sands are the answer are dreaming.
The Saudi's have much cheaper oil, and billions of barrels at that.
The problem is getting enough out of the ground to meet rising demand: And lifting crude oil is much quicker and simpler than "mining" oil sands.
Peak oil is not about running out of oil. It's about production peaking, and the inevitable downslope thereafter.

 

[numbercruncher]

Re: OIL AGAIN!

I want to buy the Air car the day its released in Australia and do my bit for the oil supply. Pre-Production is apparently this year.

The air car is poised for mass production

If someone tried to sell you a zero-emissions car that costs around $10,000, you might think he was full of hot air. Turns out it’s the car that’s full of it: The vehicle runs on and emits nothing but air. Now, after more than fifteen years of languishing in automotive obscurity, it’s heading for mass production.
The Air Car is the brainchild of Guy Negre, a French inventor and former Formula One engineer. In February, Negre’s company, Motor Development International (MDI), announced a deal to manufacture the technology with Tata Motors, India’s largest commercial automaker and a major player worldwide. “It’s an innovative technology, it’s an environment-friendly technology, and a scalable technology,” says Tata spokesperson Debasis Ray. “It can be used in cars, in commercial vehicles, and in power generation.”

http://www.insnet.org/ins_headlines.rxml?id=5991&photo=

After fourteen years of research and development, Guy Negre has developed an engine that could become one of the biggest technological advances of this century. Its application to Compressed Air Technology(CAT) vehicles gives them significant economical and environmental advantages. With the incorporation of bi-energy (compressed air + fuel) the CAT Vehicles have increased their driving range to close to 2000 km with zero pollution in cities and considerably reduced pollution outside urban areas.
The application of the MDI engine in other areas, outside the automotive sector, opens a multitude of possibilities in nautical fields, co-generation, auxiliary engines, electric generators groups, etc. Compressed air is a new viable form of power that allows the accumulation and transport of energy. MDI is very close to initiating the production of a series of engines and vehicles. The company is financed by the sale of manufacturing licenses and patents all over the world.

http://www.theaircar.com/

 

[rederob]

Re: OIL AGAIN!

Looks like Oil may play out how many of us suspected

Not sure what this meant!
Please explain.

 

[numbercruncher]

Re: OIL AGAIN!

Not sure what this meant!
Please explain.

That explosive price growth looks increasingly unlikely for a very long time.

I simply cant see how short of wildcards or artifical price stimulation, such as opec reducing quotas or an Iran/US war etc.

 

[Smurf1976]

Re: OIL AGAIN!

In the event that prices do fall significantly, quite a lot of presently priced out consumption will presumably come back into the market, particularly the poorer countries. So we'd have to see either a major increase in supply or fall in Western consumption to get back to cheap oil.

So far, the effects of production failing to meet underlying demand have been largely hidden in the wealthy countries since it's the poor countries where energy has become physically scarce as they are out bid by the wealthy nations.

I wonder how long until "poor" starts to include what most consider to be "wealthy" countries once we run out of genuinely poor ones to price out of the market? With booming demand and faltering production it will happen faster than most are expecting IMO. And it's not something we can collectively buy our way out of with money. On the downside of the slope someone HAS to be left without, that's the rules of the game. And the number left without has to constantly increase.

 

[numbercruncher]

Re: OIL AGAIN!

CARACAS, Venezuela (AP) -- President Hugo Chavez on Sunday threatened to cut off oil sales to the United States if Exxon Mobil wins court judgments to seize billions of dollars in Venezuelan assets.

"If you end up freezing (Venezuelan assets) and it harms us, we're going to harm you," Chavez said. "Do you know how? We aren't going to send oil to the United States. Take note, Mr. Bush, Mr. Danger."

"If the economic war continues against Venezuela, the price of oil is going to reach $200 (a barrel) and Venezuela will join the economic war," Chavez said. "And more than one country is willing to accompany us in the economic war."

http://money.cnn.com/2008/02/10/news/international/chavez.ap/index.htm

Heres one of the wild cards im talking about

 

[The Mint Man]

Re: OIL AGAIN!

Thought you guys might be interested in this;

Oil Prices Jump on Chavez Threat​

Monday February 11, 4:07 pm ET
By John Wilen, AP Business Writer

Oil Prices Spike Higher After Venezuelan President Threatens to Cut Off Oil to US ​

NEW YORK (AP) -- Oil futures shot higher for the third straight day Monday as concerns about potential supply disruptions overshadowed worries about the cooling economy.
Venezuelan President Hugo Chavez threatened Sunday to cut off oil sales to the U.S. as retaliation for court orders freezing assets belonging to Venezuela's state oil company. Exxon Mobil Corp. has gone after Petroleos de Venezuela SA in U.S., British and Dutch courts, challenging the nationalization by Chavez's government of a multibillion dollar oil project. A British court last week issued an injunction freezing as much as $12 billion in Petroleos' assets.

"If you end up freezing (Venezuelan assets) and it harms us, we're going to harm you," Chavez said. "Do you know how? We aren't going to send oil to the United States."

Mike Fitzpatrick, vice president of energy and risk management at MF Global LLC, said it was hard to weigh the comment.

"How much credence you want to give him is always a question mark," Fitzpatrick said.

But traders were clearly worried about the potential cutoff of Venezuelan oil. Light, sweet crude for March delivery jumped $1.82 to settle at $93.59 a barrel on the New York Mercantile Exchange after spiking to $94.72 earlier, a one-month high.

Word of power outages at a Valero Energy Corp. refinery in Delaware City, Del., and a Citgo Petroleum Corp. refinery in Lake Charles, La., also helped push prices higher. Both plants were being restarted Monday, Dow Jones Newswires reported.

Traders were unnerved by new violence in Nigeria, Africa's largest oil producer and a major supplier to the U.S. On Monday, unidentified gunmen attacked a naval vessel that was escorting petroleum industry boats, killing one sailor and injuring another. Militant attacks have cut Nigeria's oil output by nearly one quarter in the past two years, helping send oil prices to all-time highs.

Concerns about supply disruptions overseas have temporarily drawn investors' focus away from the weakening U.S. economy, which had been the market's dominant theme. Worries that the economy is slowing, and demand for energy is falling, pushed oil prices down from a record above $100 a barrel in early January to nearly $86 in recent weeks.

Still, some analysts believe tight global supplies and efforts by Congress and the Federal Reserve to stimulate the economy will keep oil prices high for the foreseeable future.

In a note to clients, analysts at Goldman Sachs said the impact of a recession on oil demand growth "is likely to be meaningful," but not enough to keep Nymex crude from trading at $105 a barrel a year from now, Dow Jones reported.

At the pump, gas prices slipped 0.4 cent overnight to a national average of $2.953 a gallon, according to AAA and the Oil Price Information Service. Prices have mostly fallen lately, following oil's decline from its January record. But the Energy Department and many analysts expect prices to rebound in the spring and rise to new records near $3.50 a gallon.

Other energy futures also rose Monday. March heating oil futures rose 5.03 cents to settle at $2.6044 a gallon on the Nymex, and March gasoline futures rose 3.9 cents to settle at $2.3962 a gallon. March natural gas futures rose 23 cents to settle at $8.531 per 1,000 cubic feet.

Analysts said the current cold snap in the Northeast and Midwest was supporting heating oil and natural gas prices.

In London, Brent crude rose $1.59 to settle at $93.53 a barrel on the ICE Futures exchange.

Associated Press writers Pablo Gorondi in Budapest and Gillian Wong in Singapore contributed to this report.

I remain bullish on oil which is why I'm still holding OSH, plus it wasn't that long ago there were takeover talks circulating about OSH.

Cheers

 

[noirua]

Re: OIL AGAIN!

Speaking at a conference in Florida, Abdullah Alireza, Saudi Arabia's Minister of State, said that, with US$500 billion tied up in the U.S.A. currency, uncoupling the Saudi riyal would be like Saudi Arabia shooting itself in the foot.
"The dollar is our currency of choice," he said. "We have no reason to believe that currency re-evaluation would be a panacea."
Alireza also said relations between Saudi Arabia and the US were worsening.

 

[numbercruncher]

Re: OIL AGAIN!

Alireza also said relations between Saudi Arabia and the US were worsening.

Theyd get alot worse should Saudi run out of Oil

 

[numbercruncher]

Re: OIL AGAIN!

Venezuela's state petroleum company PDVSA said Tuesday it suspended oil supplies to ExxonMobil in retaliation for the US energy giant's effort to freeze billions of US dollars in global PDVSA assets.

In a statement, the Venezuelan oil concern cited "judicial-economic aggression" by ExxonMobil as the reason for its action, which it described as an act of "reciprocity."

http://news.theage.com.au/venezuela-oil-firm-pdvsa-cuts-supplies-to-exxonmobil/20080213-1ry3.html

 

[numbercruncher]

Re: OIL AGAIN!

World oil market could be set for lengthy slowdown: IEA
PARIS (AFP) - The world oil market could be set for a lengthy slowdown, the International Energy Agency said on Wednesday, signalling a sharp shift in the climate which pushed the oil price to 100 dollars last month.

"Just as the demand shock of 2004 shaped the oil market for the next three years, so too could the pending slowdown," the IEA said in its monthly review of oil trends.

http://au.news.yahoo.com/080213/19/15tq0.html

 

[Smurf1976]

Re: OIL AGAIN!

PDVSA. A technologically brilliant company with more potential to boost production than any other company or country. Unfortunately it's been nothing short of ruined by government - a reality which in itself virtually guarantees a peak in global production IMO.

 

[ithatheekret]

Re: OIL AGAIN!

Gas shot up tonight .

 

[Uncle Festivus]

Re: OIL AGAIN!

Oil Fundamentals
``The fundamentals of the oil market are a lot weaker than six weeks ago, when we first breached $100,'' said Tim Evans, an energy analyst at Citigroup Global Markets Inc. in New York. ``The economy is slowing, inventory levels in the U.S. are more comfortable, we are further through the first quarter and closer to the downturn in demand that occurs in the second quarter.''

Can it break though on lower volume or are the speculators getting ready to take profits?

 

[proinvestor]

Crude oil at $120 a barrel will be soon a reality

Why are oil quotes so hot again? Some guys say OPEP is making all efforts to maintain prices above $80, others saying that US slowdown will not affect directly demand of Oil and just few of them anticipating a possible war in the Middle East (unlikely I'm sure but there is always a possibility), and do you know which is my point of view in all of this scenario, speculation....... to pump this commodity to high levels. Currently, surging oil prices have darkened the economic outlook in the United States and also have threatened economic growth in Europe, so the crude are very linked to the actual situation of instability in economy but some guys are trying for all ways to hide this fact and focus only the currently debility in economic with a problem of subprime. Presently, it appears that high prices are acceptable to the American and Europeans consumers, reports of demand still showing no signs of a dramatically cut by people who uses their cars as the main way of transport, on the other hand outside the US, demand increases are being led by India and China, where growing economies mean more cars and trucks and more factories that burn oil and gas. All these factors together are a good tone for traders, speculate and pump this commodity, even knowing that economy will slowdown. So, there is no reason to dream with Oil prices at $50, 60 or even $75 again, we are facing a lot of changes in our way of life and we will pay for that. Did you saw our governments providing economic incentives for alternative energies or creating new ways for consumers slowdown the use? I'm not; probably I'm blind and just seeing the Black liquid in front of me. Anyway, and I'm not a fundamental analyst of Oil neither like to talk about that, but I'm just alerting you for the prices that you will see soon in front of eyes when you'll have to go to a gas station with your car. From a technical perspective, Oil will soon spike again and next stop will be well above $100, probably near $120.

 

[ithatheekret]

Re: OIL AGAIN!

I'll buy that , the prices I've seen and the latest yeehaas by the market that Pickens has shorted oil are just a by-line for me . OPEC cuts production each March , they have to keep up maintenance .

I believe we have seen the low in oil , which we will get back to for a retest at some stage , but I don't think it will be until after March or further up the line , say somewhere between July to September .

To be honest , now that the market is used to seeing the $100 beacon flashing away , I wouldn't be surprised to see an event push oil into $150 , that would rattle all our cages .

 

[Wysiwyg]

Re: OIL AGAIN!

The questions i ask myself are will the Venezuelan government/Exxon Mobil issue be settled without supply disruption to the U.S. and will the OPEC`s maitain current production levels and will the U.S. economy downturn tighten their fuel consumption overall ?

With the Venezuelan issue there is a 3 day court hearing scheduled for next week on the 27th. so unless there is more sabre rattling from Chavez, things should be quiet until after the hearing.

With the OPEC issue, a $100 per barrel floor is scary.Here is a snippet from their website :-

Opec still sticking to low output strategy

By Syed Rashid Husain RIYADH, Feb 22:

With crude prices hovering around $100 a barrel mark, the Organisation of Petroleum Exporting Countries (Opec), due to meet to decide its output quotas on March 5, says it will wait and see whether prices stay at $100 a barrel, before making a decision on its output.

“With prices at these levels, the cartel will have to wait and see if the $100 a barrel level forms a floor,” and whether prices will continue their latest rally or drop back below $100, Libyan oil minister Shokri Ghanem said.

The U.S. economic downturn will result in less fuel being used but with saying that, their (and ours to an extent) addiction to guzzolene is hard to break.

Just some thoughts.

 

[rederob]

Re: OIL AGAIN!

The U.S. economic downturn will result in less fuel being used but with saying that, their (and ours to an extent) addiction to guzzolene is hard to break.
Just some thoughts.

Neither the US nor Europe will have much to do with oil increasing in price.
Increasing demand is from the rest of the world, with the usual suspects being yet again guilty.
Frankly, the US could experience a decline in demand, and the rest of the world will pick up any slack.
Little by little the importance of the US is diminishing in all areas where we typically expected them to lead: Although it must be noted that it will be very many years before total oil consumption by the US is eclipsed by China.

OPEC knows their oil is more valuable in the ground than out, so they won't be in any hurry to help the rest of the world with their energy concerns. And while $100 is not yet a "floor", it's curious that with the spectre of recession about, oil is not being sold down!