PEAK OIL - The New Y2K or The Beginning of the Real End? Message Board

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Gold/Mining/Energy : PEAK OIL - The New Y2K or The Beginning of the Real End?

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From: Doug R	5/21/2005 6:22:47 PM
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OPEC (still) pumping at full capacity - minister Sat May 21, 2005 TEHRAN (Reuters) - OPEC is pumping at full capacity, Iran's oil minister said on Saturday but added that any move by the cartel to legitimise its over-production would not affect the market. "OPEC members are supplying world markets with their utmost capacity," Bijan Zanganeh was quoted as saying on the oil ministry Web site. "But legitimising the extra output from these countries will not have any affect on market conditions," he added. Iran, OPEC's second biggest producer, is a traditional price hawk and often plays down the cartel's ability to cool high-flying prices that many industrialized nations have said pose a threat to economic growth. OPEC's president said on Friday the cartel would continue pumping in excess of its own official output limits, at about 30.5 million barrels per day (bpd), allowing stocks to build further on a comfortably-supplied world market. OPEC is producing about a million barrels daily above its official 27.5 million bpd output target, with another 2 million bpd from Iraq not included in quota arrangements. OPEC President Sheikh Ahmad al-Fahd al-Sabah said this volume of over-production would help bring prices down to $40-$45 per barrel. NYMEX crude futures prices have slipped to about $47, after hitting a record high of $58.28 last month. Prices retreated after a tide of crude shipments boosted U.S. inventories to their highest level in six months. today.reuters.com Is there any question that the inventories WILL be drawn down? After that, reality will take over. This inventory build looks like a frenzy to get as much oil as possible now before supply becomes inadequate and prices get higher yet. The topping off of the SPR over the last year even into the price run-up was also the same message. Buy low is the norm. Prices over the last year are now considered low.

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