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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: dvdw© who wrote (92206)	7/4/2012 10:30:48 PM
From: Antar	Read Replies (2) \| Respond to of 217732

Actually the main reason that oil prices have been so high in the last year is because of the belligerent threats of Isreal towards Iran. Notice how oil went down about 30 dollars when it seemed that nuclear negotions seemed to be productive. Add that extra cost of oil to all the subsides that Isreal gets to figure out the true cost of Israel's to the world because of their occupation of the west bank.

To: dvdw© who wrote (92206)

7/7/2012 4:11:44 PM

From: dvdw©

Respond to of 217732

Bingo...NO...but So it begins......

To: Dennis Roth who wrote (170060)	7/7/2012 11:45:00 AM
From: Dennis Roth	1 Recommendation of 170443

Iraqi Kurdish Oil CS COMMENT Trucks start rolling to Turkey Event – According to the Telegraph, oil from the Iraqi Kurdish Region has started to roll via trucks into Turkey on 5th July. This is the next progressive step forward and confirms what has been agreed as part of the bilateral agreement announced at the end of May between the KRG and Turkey. This event suggests that licenses have now been given to Turkish companies to acquire oil from Iraqi Kurdistan, and the facts on the ground very much confirms Turkey’s commitment to the region and is de-risking future infrastructure plans. In other words, this is not just rhetoric, but progressive action. We view this as positive to Iraqi Kurdish oil and our preferred way to invest is via Genel Energy. Blended prices to rise – it is difficult to say how much is being exported and how this will ramp-up. We think this is part of an agreement to barter crude in exchange for oil products from/via Turkey after Iraq stopped supplying oil products to the Iraqi Kurdish Region following the announcement of the bilateral agreement. MEES previously reported that oil product supply guarantees from Iraq amounted to ~40kbd. Taq Taq has trucking capacity of ~90kbd currently. Domestic refining capacity amounts to ~160kbd and is set to increase to ~250kbd in 2013. Production capacity from the fields in Iraqi Kurdistan will rise. Oil exports via trucks should elevate blended prices for oil companies. We think blended price realisations could rise to ~$80/bbl versus current domestic prices of $55-60/bbl (for Taq Taq and Tawke). Turkey will pay international prices (less a discount) on a netback basis for the volumes being trucked into Turkey, in our view. Greater exposure to international pricing has to wait until the end of 2013 in the absence of any export agreement between the KRG and GOI. It is the end of 2013 when the 1mbd pipeline from Khurmula to Fishkabur (Turkish border) is completed (to be constructed by Turkish companies, in our view). Payment for ‘Iraqi Oil’ would be managed by the KRG rather than SOMO. What can Baghdad do? Not much, in our view, other than rhetoric. After all, the announcement in late May stated very clearly that this agreement is for ‘Iraqi Oil’ and that to us indicates that Iraqi Kurdistan is following the details of the constitution. With that, we do not think that the KRG’s entitlement of the national budget, which is under the control of GOI, would be at risk (the KRG is entitled to 17% of Iraqi revenue, but in reality it is closer to 11% after deductions). And Iraqi Kurdistan has the commitment from Turkey, which is growing in importance in the region, and also the GOI is losing leverage over IOCs as many are looking to exit the South and move into the North. Undoutedly, what will be more tricky politically is any further moves into disputed territories at this stage, in our view. Ultimately, just noise-making from Baghdad, which we have become accustomed to, and little noise from political opposition in Turkey to ‘trucks rolling’, will accelerate IOCs move into the Iraqi Kurdistan, we think. IOCs growing interest – Suffice to say that numerous IOCs, including Total and Statoil, are looking to enter the Iraqi Kurdish Region (via license awards and farm-ins). Quite the contrary in the South, relevant IOCs are leaving and losing interest to gaining acreage in the South (eg the disappointing 4th licensing round). Kommersant previously reported XOM is looking to farm-down part of its stake in WQ-1, while Statoil has already exited its stake in WQ-2. Companies Mentioned (Price as of 05 Jul 12) ExxonMobil Corporation (XOM, $85.57, NEUTRAL, TP $91.00) Genel Energy plc (GENL.L, 610 p, OUTPERFORM, TP 1,180.00 p) Rosneft (ROSN.MM, Rbl211.81, UNDERPERFORM, TP Rbl180.00) Statoil (STL.OL, NKr142.60, UNDERPERFORM, TP NKr165.00) Total (TOTF.PA, Eu36.52, NEUTRAL, TP Eu43.50)