Thursday, June 19, 2008

Endgame in Iraq?

New deals are about to be struck between the big four oil companies and the Iraq administration on a no-bid basis. These are two year deals with preference given to these same companies at renewal time.

And with the New York Times reportof the new “oilfield service agreements” for the four oil companies ExxonMobil, Chevron, Total and BP, all granted in no-bid fashion, it is clear to anyone watching that the end-game had to be resolved before the door hits the oilmen on the way out of Washington. Blood in Your Tank: Petrofraud War - Smirking Chimp

But the author Michael Fox talks of the repercussions - Russia and China are both cut out of this deal. Will we Brits suffer from this with even higher gas prices from a miffed Russia?

And then there's Iran - a resolution passed in congress for a naval blockade in the Straits of Hormuz - yes big oil is definitely looking for high oil prices whilst they are still in power. Global Research

Endgame? No it's just the beginning

Wednesday, June 11, 2008

Speculating Paper Oil

As oil price currently peaks at $139 per barrel, The Opec Secretary general appeals for calm in the stock markets where speculation reaches an all time high.

In support of his point that prices are being driven by factors other than supply, Badri said world consumption of 87 million bpd is smaller than the value of trading in oil-related financial instruments.

Badri said the "paper market" equaled about 1.36 billion bpd and he was critical of investment banks, some of whose forecasts for rising prices have been partly credited for sending oil to new peaks...OPEC, which currently has 13 member-countries, was willing to raise production if needed, although there was no demand for extra barrels.

"Nobody is asking for oil at this time. We are checking with our member countries. There is no queue for oil," he said.

Thursday, May 22, 2008

Enough Already...

As the price of a barrel hits $135 today I think the Guardian have it right in this piece:

Bubble Trouble

It is most definitely a bubble and I think the last $30-$40 hikes are down to speculation alone. Glad to hear that the wheat bubble just burst. These stock market people are just idiots - greedy idiots.

Wednesday, April 16, 2008

$114.95 while my back was turned

Have been to busy to blog, or to watch the oil news, hence I missed this new peak at nearly $115.00. So I was wrong, over at my nomination for highest price in 2008 was $125, that'll be blown before midsummer's day.

Also heard from a pal in the food industry, farmers are taking out of the system land for food and are now growing biofuels - this land won't return to food crops until its price is better than fuel. This is no longer a threat, it is happening today and the company can't get enough supplies. I often thought that in the west, food was too cheap, we throw too much away and we should pay more, but this global economy means that high prices lead to starvation in true third world countries.

I think there must be a penalty tax on car use, we've got to stop burning our food potential, if we don't return our land to growing food we shall be plagued by wars and conflict until the population reaches a sustainable level.

Wednesday, March 5, 2008

$104 and rising..

(AP Photo/Ronald Zak)
VIENNA, Austria - OPEC on Wednesday accused the U.S. of economic "mismanagement" that it said is pushing oil prices to record highs, rebuffing calls to boost output and laying blame at the feet of the Bush administration.

Oil prices surged past $104 a barrel for the first time after the OPEC announcement and the release of a U.S. government report showing a surprise drop in crude oil stockpiles.The 13-nation Organization of Petroleum Exporting Countries said it would maintain current production levels because crude supplies are plentiful and demand is expected to weaken in the second quarter.

OPEC President Chakib Khelil told reporters the global market is being affected by what he called "the mismanagement of the U.S. economy," and that America's problems were a key factor in the cartel's decision to hold off on any action.
Associated Press

At the same time Bush is telling the International Renewable Energy Center: "We want our city people driving not on gasoline but on electricity. And the goal, the short-term goal, is to have vehicles that are capable of driving the first 40 miles on electricity".

Confusing messages from Opec and Bush. Is it just the US dollar or is Big Oil persuading Bush to scare his SUV drivers so they won't complain about the price at the pump? Perhaps it's a mixture of both - the price should be high due to demand over supply, but as long as the dollar is on the wane then there will be an exchange rate premium to the oil price hike.

Saturday, February 9, 2008

The Wiemar Dollar

Michael Fox analyses the $600 per head cash handout that Bush is hoping will raise the economic outlook of the USA.

"Where is this $150,000,000,000.00 “economic stimulus package” coming from? Let’s make this really clear. The United States government does not have any money. On the contrary, the national debt now stands at $9.2 trillion dollars, which is more than 61 times more than the “package.” So, as they don’t have the money to give, those $600 checks they plan to mail out this spring will literally comprise just printing money." Smirking Chimp

And printing money leads to a devaluation of the currency which leads to an increase in the price of oil etc etc etc.

I see it as just pure folly, but Fox sees a sinister attempt by big oil to grab more cash from the population. He also warns of the eventual outcome of the US attitude to economics - comparing it to the Wiemar Republic between the wars and Germany's "way out" of the situation.

Wednesday, January 23, 2008

The costly truth about tar sands

Designer of loss making Toyota Prius, Bill Reinert, talks of the environmental damage caused by tar sand extraction in Canada, and of the costly resources required to turn the sands into synthetic oil. a 2-mile-wide pit below, trucks head to refineries with loads of sand weighing more than Boeing 747s. Yellow flames shoot skyward as 900-degree-Fahrenheit (482- degree-Celsius) heat liquefies any embedded petroleum. Floating scarecrows and propane-powered cannons do their best to chase migrating birds from lethal wastewater ponds.

Eventually, nuclear reactors may surround the crater 270 miles (435 kilometers) northeast of Edmonton, Alberta, delivering the power required to wring oil from sand...

Meanwhile, at Fort McMurray's pit mines, it takes 2 tons of sand, 250 gallons (947 liters) of water and 1,400 cubic feet (39.6 cubic meters) of natural gas to produce one barrel of synthetic crude, says Peter Wells, director of research firm Neftex Petroleum Consultants Ltd. in Abingdon, England.

That's enough water for a day's use for a U.S. family of four and enough natural gas for 5.6 days. The gas is burned to power a process that extracts a tarry substance called bitumen from the sand and then refines it into synthetic crude.

In turn, each barrel generates as much as 110 kilograms (240 pounds) of carbon dioxide equivalents, the same as refining three barrels of traditional light crude.

"...When you're schlepping around two tons of sand for a barrel of crude, it shows that conventional oil is already well into depletion", says Jeffrey Rubin, chief economist at CIBC World Markets Inc. in Toronto.

Read more of this excellent article at :- Bloomberg