Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Natural Resource Stocks -- Ignore unavailable to you. Want to Upgrade?

To: SliderOnTheBlack who wrote (22665)	3/10/2005 5:44:21 PM
From: semi_infinite	Respond to of 109006

Oil deserves to go down some here to blow off the froth but don't look for it to stay down long. China has been on a different car buying track since WTO. You need to talk to someone that lives there if you think a recession (for them 6% gdp growth)there will curb oil demand. Do you know whats happening at Ghawar, Burgan, Safiniya, Khafgi etc... These are no doubt the largest water cycling projects on the planet and the increasing amount of water being circulated to squeeze out the same daily production is near the limit of handling capacity increases at which point flat production turns into decline. Maybe when it becomes obvious to non-oil folks then Mr. Raymond will pull his highly priced oil out of the Exxon's hat and show us how right he has been at a very profitable price. We may be there already but since it takes 10-20 years to get some of these production methods optimized, we will easily to pay through our noses ($100/bbl) for a little while before Mr Raymond liquidate to us his expensive reserves. That's the way things go, when oil was below $20 and Burgan was cycling 80% water, I asked an engineer what his company's projections were and he told me $25/bbl and 120 million bbl/day production by 2010. Yeah sure, show me the oil.

To: SliderOnTheBlack who wrote (22665)	3/11/2005 1:37:59 AM
From: 8bits	Respond to of 109006

The interview with Raymond doesn't really give much detail does it..? Sounds like a conservative speaker on his company and the industry in general which I respect. (More Tech CEOs should have been like this in the late 90s) He doesn't want to commit to any projections for the price of oil for likely several reasons. 1) If XOM drops appreciably his company could get sued. 2) If oil continues to rise you'll have a large number of people saying high oil and gas prices are due to big oil. Interviews from oil execs will be dredged out. You get the idea. 3) Many natural resource companies are working with figures for the resources they sell that are lower than current prices because (and they have been lowballing their pricing for several years..) Oil and oil companies can and have taken downturns in the past few years (May 2003, Last Summer, and Last December..) holding them so far for the long term so far (2002) so far has been quite profitable. Didn't the oil companies do quite well from 73 to 80..? (With of course periodic dips..) We've had a tremendous rise in the past few months so we are overdue for a breather but with spare oil capacity constrained (and with the long lead time it times to bring more oil and natural gas to market) I think the oil bull has some legs.