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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Crimson Ghost who wrote (46354)	6/12/1999 3:52:00 PM
From: BigBull	Read Replies (3) \| Respond to of 95453

Big Dog has performed a public service by publishing the OFFSHORE DRILLING BITS newsletter. Here's why IMO. Matt Simmons answer to question #18 in the now famous 20 questions interview issue. Simmons tells us to watch the OECD numbers to see if the "missing barrels" start showing up in May or June. If the "missing barrels" do not show up by then, this would mean that there never was any "THE GLUT THE GLUT THE GLUT" in the first place. He also stated that once it dawned on people that this was the case then the oil market would get "very tight, very fast". In its current report IEA says the following wrt OECD numbers: "Within 29 nations of the Organization for Economic Cooperation and Development, oil supplies have being eroded at about 900,000 barrels a day in the first quarter of this year and we ''could see that rise to over 1.5 million barrels a day in the coming months,'' Knapp said." Sure doesn't look like IEA thinks the "missing barrels" are going to show up anytime too soon, does it? Not with this depletion on stocks. The only other explanation for this conclusion is that demand is overwhelming supply anyway and the "missing barrel" are irrelevant. Simmons further indicates that Mr. Knapp is the "Father of the Missing Barrels" anomaly. I now include another quote from the current IEA report which I believe to be a "tacit admission" by Mr. Knapp that there are no "missing barrels". ''Toward the end of the year the surplus could be gone -- it may even happen sooner,'' said David Knapp, head of the oil industry and markets division at the IEA. ''It is all dependent on the recovery in Asian demand and the compliance we see from OPEC.'' To top it all off this quote clearly confirms that the "missing barrels" are not "flooding" onto the market place. "Evidence the oil glut is going away has shown up in the storage tanks of the world's largest oil importer and consumer, the U.S. According to the industry-funded American Petroleum Institute's latest inventory report, oil supplies are 3.8 percent below levels stored a year ago while imports are 12 percent below year-ago levels." IMO this is why oil prices are increasing in the face of horrendous recent weekly API gas numbers. The potential for a strike in Venezuela is only a mask for the REAL story. The oil market is finally waking up to the TRUE oil supply and demand picture. That picture is one of substantially higher oil prices in the near to mid-term future. IMO it already "baked into the cake". What the recent IEA report does NOT factor in is the possibility that the worlds economies will undergo an economic boom, hence driving demand factors to the levels at least as high as their last cyclical peak. I have long held that this (boom)will be the case based on demographic spending wave patterns and interest rate factors. The current economic statistics from the US, Canada, Mexico, Australia, New Zealand, Korea, Japan, India, Thailand, Malaysia, Taiwan, and the Phillipines support my case more and more. IMO Wollanchuk and the "Bag Man" are right. However, I do earnestly request anybody with a contrary opinion to post with facts that would support your case. I will attempt counter your arguments with facts. The Matt Simmons interview was prescient, timely, and probing. IMO the KEY questions were asked wrt Oil Prices and OS stock prices. That interview helped this "non-expert" gain a far better understanding of where the "price of oil stupid" is heading. UP! Big Bull extends heartfelt thanks to Big Dog.