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To: ild who wrote (243413)	6/2/2003 12:03:55 PM
From: ild	Read Replies (1) \| Respond to of 436258

Date: Mon Jun 02 2003 11:37 trotsky (crude oil) ID#377387: Copyright © 2002 trotsky/Kitco Inc. All rights reserved back above 30, and illustrating one of THE major differences in this post Gulf war environment vs. the early 90's one: energy prices refuse to back down. note that global crude oil production has now been declining for 3 years running, while demand has continued to rise at its long term average of 2% annually - a widening supply/demand imbalance with inventories diving to multi decade lows is the result. why is production declining in spite of much higher prices? there's a frightening possibility: the global Hubbert peak may have arrived a few years earlier than anticipated. note that it is highly unusual for global production to fall so markedly when prices improve to the extent they have. in spite of all the media hoopla about OPEC's alleged cheating on quotas, production has in fact plunged at all OPEC producers last year except Algeria ( which is OPEC's smallest producer ) . this is even more remarkable considering that the Saudis were reportedly pumping all out to avert shortages in the wake of Iraq. so it's no wonder that operation 'grab the remaining large oil fields' has been expedited recently.