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To: patron_anejo_por_favor who wrote (21055)	9/22/2000 10:31:21 PM
From: Ken98	Respond to of 436258

<<Tight Supply, Logistical Bottlenecks to Push Oil Prices Higher 1050 GMT, 000920 Summary Rising energy consumption, stagnant production of crude oil, low reserves and capacity constraints along the supply chain will combine to keep crude prices at current high levels, $35 to $40 per barrel, at the very least until spring, even if Saudi Arabia increases production as much as possible and nothing disrupts the supply chain. Any disruption will immediately spike prices higher, and without any slack in the system they will be very slow to come off new highs. The world will soon have to accept $45 as the bottom-end price for a barrel of oil.>> stratfor.com

To: patron_anejo_por_favor who wrote (21055)	9/23/2000 12:25:57 PM
From: Archie Meeties	Read Replies (1) \| Respond to of 436258

My guess is that the net effect of SPR release is an addition of 30mill barrels of refined product in Europe. Oil or refined products that would flow here will instead be diverted to Europe, which in turn will be able to contribute to our HO imports mid winter. I think crude will stay range bound for the next 3 months and the markets (both the oil and the bond market) will try to discount this winter as just a transient problem. It won't become clear that it's a problem that's here to stay until the 3rd and 4th draw from the SPR (which are pretty much inevitable). In the meantime, I'm covering my shorts next week or maybe the week after (I think there's a bit more giving to do) and growing a pair of horns. The inflationary threat to the economy - which was the only cause for my bearishness - will be contained come hell or high water through the use of the SPR. The big move up in the JOC-ERCI data recently was almost entirely due to energy, and supported both my bullishness for gold and bearish for equities. It should reverse. Gore may continue to release oil for the next 2 years while at the same time trying to speed the transition to a less oil dependent transportation infrastructure. It's not as if he cares a whit about the oil industry (except OXY, of course). What is gone is any impetus for OPEC to officially raise quotas. On the other hand, I don't expect any members to cut back production as they see the price decline. They might say that they will, but they've been exceeding their quotas all year long - those that can.