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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Raymond Duray who wrote (56582)	11/27/2004 10:03:02 PM
From: Maurice Winn	Read Replies (1) \| Respond to of 74559

<The only way that the world will again see $40/bbl oil is a decline in demand, i.e., a global recession.> Ray, I'll bet $10 to a knob of goat poop that we see $40 again. At $40 there are still all sorts of altervatives which are economic. Oil at $40 will lose market share. Saudi Arabia, Iran, Iraq and Russia won't stand for it. They'll boost production, open the spigots and regain market share. They are making a fortune at anything over $40 and the more they can sell, the better they'll like it. Iran isn't messing around with uranium because they think their oil is going to run out any time soon. It's not noocular power they want. It's bombs!! Orinoco crude oil emulsions are economic at $40 a barrel for oil. So is coal. So are a LOT of other ways of saving an energy buck, including insulation and buying a CDMA cyberphone instead of an airline ticket. As US$ interest rates relentlessly rise, you'll see some major paradigm shift happen. Shift happens and the end of history and paradigm shift have not happened. We can have continuing economic boom AND a reduction in the price of oil [as the US$ recovers somewhat, the deficit shrinks and Al Q fades into history]. Mqurice

To: Raymond Duray who wrote (56582)	11/28/2004 10:48:52 AM
From: BubbaFred	Read Replies (2) \| Respond to of 74559

<<...the world is running at 99% of available wellhead capacity..>> That's what I read also but it is only part of the story. The $40 price level is still very sweet if there is a need to drop it to that level. OPEC only wanted to maintain it at $30 and is undoubtedly a nice surprise to be enjoying today's price levels. It is not from lack of supply or shortage. The supply from Iraq becomes very critical factor to the supply and price levels and that's one important goal for US invasion - full control of world's oil supply. All the tax incentives for buying big SUV's and gas guzzlers is one small part of the equation, that Americans continue to consume as much oil as they possibly can, but just enough to balance the supply and demand. Unlike power plants that can use coal, vehicles use gasoline from crude oil. Why there is no incentive for energy conservation? Why there is no tax incentive for utilizing alternative energy like solar and wind? I think there are other forces that keep it at today's price levels. When supply and demand is pretty tightly matched up, then it doesn't take huge sum of money to manipulate the price or control just 0.1% (hypothetical number) of the supply. If there is a bigger imbalance (say 3% oversupply) then it takes enormous amount of money to control the price and the risk become much greater as well. Besides, someone(s) are getting hefty profits for those heavy crudes these days, compared to getting nothing 5-8 years ago.

To: Raymond Duray who wrote (56582)	12/2/2004 3:39:19 AM
From: Maurice Winn	Read Replies (1) \| Respond to of 74559

Hi again Ray. Crikey, look at this. Even good quality oil is heading for $40 a barrel. Already. <Light, sweet crude for January delivery fell $3.64 to $45.49 per barrel on the New York Mercantile Exchange -- the lowest settlement price since Sept. 16. Prices climbed above $55 a barrel in October. "There are some people out there with red faces who locked in some incredibly high prices," said James Cordier, president of Liberty Trading Group in St. Petersburg, Fla. The last time oil prices fell so fast in one day was after the Sept. 11, 2001 attacks as traders anticipated the coming economic shock. On Sept. 24, 2001, Nymex crude futures declined by $3.96 to close at $22.01 per barrel.> For ease of reference, I have excerpted some recent comments to you: < <The only way that the world will again see $40/bbl oil is a decline in demand, i.e., a global recession.> Ray, I'll bet $10 to a knob of goat poop that we see $40 again. At $40 there are still all sorts of altervatives which are economic. Oil at $40 will lose market share. Saudi Arabia, Iran, Iraq and Russia won't stand for it. They'll boost production, open the spigots and regain market share. They are making a fortune at anything over $40 and the more they can sell, the better they'll like it. > I suggested to Jay a while ago that he switch to a short of oil at about $52 a barrel I think it was. Message 20625878 In 2004 dollars, oil is simply not worth $50 a barrel over several years as competition will displace it. Mqurice