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.

Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: mistermj who wrote (207035)	10/26/2006 6:05:40 PM
From: Keith Feral	Read Replies (1) \| Respond to of 281500

Many executives from major oil companies say that it is getting much harder to replace existing reserves. I agree that the term is deliberately confused so that the price of oil reflects the higher opportunity cost of locating new oil reserves vs. pumping oil from existing oil fields. I liked when the rumors were swilling that bp's prudhoe bay was pumping mostly water these days, and not as much oil. The problem with responsible management of oil reserves is that we can overproduce today to make oil look very cheap. That clearly doesn't do much for the oil refiners which end up losing money on the crack margin by buying crude oil and selling distillate products. This goes back to my point about not producing excess oil. 1 million bps of excess oil may not be much, but it adds up at the end of the year. I'm glad to see opec and others cutting back on excess production. It is really amazing that energy prices are lower in the US than other parts of the world like Europe. Our gas prices are being dragged higher by the rest of the world. Of course, that is fine with Exxon.