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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Joan Osland Graffius who wrote (45420)	4/8/2000 3:19:00 PM
From: Haim R. Branisteanu	Read Replies (2) \| Respond to of 99985

Joan, there are many alternatives which were abandoned, I think mostly as a result of oil interests. The main issue is that with modernization and higher standard of living energy consumption will grow substatially in the world. The fusion project for example, solar and wind etc. BTW the sun is the biggest source of energy and it is used mostly for water heating only. Jus think of the prospects of every Indian and Chinese family (then times US population) and office building will have air conditioning facilities as in the US now. Energy consumption will explode. During the mid 80's one of my own projects were killed due to low oil prices the shortsight of funding. BWDIK Haim

To: Joan Osland Graffius who wrote (45420)	4/8/2000 3:24:00 PM
From: Zeev Hed	Read Replies (1) \| Respond to of 99985

Joan, I am not sure the hydrocarbons landscape is as grim as that. I was led to believe that at $30/barrel, very large reserves of Canadian tar sands become profitable sources of hydrocarbons. Furthermore, I also believe that we are burning, flaring or reinjecting natural gas down hole in huge quantities, and if the industry can see a floor of $30/barrel, these can be converted to liquids or even transported in LNG vessels cost effectively. Last, I believe that the Germans during world war II used to the Fischer Tropsch process to convert coal (of which various estimates are around 500 years of supply) to liquid hydrocarbons, the SouthAfrican have survived an embargo on this process (Sasol), and today, a number of improved versions of this process exist. I actually think that the Opec cartel is keeping a ceiling of $30 on crude so as to prevent the development of these technologies rather than from the "good of their heart", since above $30/barrel, these technologies will be deployed and cut into Opec share of the market. If these are correct, one can take the position that indeed $30 is the ceiling of crude and Opec will keep it bound between $25 and $30 if it can, and the market may bring it back down to $10, if Opec discipline starts and develop "cracks". Zeev Zeev