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Strategies & Market Trends : Heinz Blasnik- Views You Can Use -- Ignore unavailable to you. Want to Upgrade?

To: Wyätt Gwyön who wrote (339)	4/20/2003 11:07:31 PM
From: MulhollandDrive	Read Replies (1) \| Respond to of 4912

darfot: set a price which induces complacency while maintaining cash flow. but this does not mean the price will be in the 20s two or five years from now. that assumes a static situation. but the reality is not static. the House of Saud could fall and bring an immediate oil shock. and if that doesn't happen, it will be Chinese water torture of insufficient supply and growing demand. another way to think of it is like this: the Saudis want to keep a certain market share. they can keep this share at $30 a barrel today. in ten years, they can keep the same share at a much higher price. this was my point, obtuse, though it may have been. but my reading (in general) for the saudi "sweet spot" price wise is more along the mid 20 price point..or at least it had been so back to your original point that the saudis, due their financial needs, would begin jacking up oil prices leads to the obvious question..."from what price point"....will the saudis decreaseproduction (the only way, imo, that there is pricing power) at the mid teen or low 20's or will it be the mid 20's... my understanding is that with current demand, the mid 20 price point is that which both the saudis and the u.s. can mutually "live with" (profitably) btw... "wanting to keep a certain market share" actually , imo, implies a need to maintain market share in the face of decreasing demand (or at the very minimum, growth of demand) which seems to coincide with a bearish viewpoint of contracting demand worldwide

To: Wyätt Gwyön who wrote (339)	4/21/2003 11:20:45 AM
From: carranza2	Read Replies (2) \| Respond to of 4912

the House of Saud could fall and bring an immediate oil shock Anyone who wants an insider's glimpse into the fragility of the House of Saud house of cards needs to read The Atlantic Magazine's latest issue in which Robert Baer, a former CIA bigwig, lists a few facts that should chill anyone who thinks our supply of oil is secure. The article is entitled The Fall of the House of Saud; it should be required reading for anyone with even a passing interest in the subject. It is unfortunately not available online.