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To: Razorbak who wrote (37933)	2/21/1999 8:13:00 PM
From: Evan Dimmer	Respond to of 95453

ADMINISTRATION OFFERS MORE HELP TO OIL PRODUCERS February 19, 1999 States News Service via NewsEdge Corporation : WASHINGTON Feb. 17 (States) -- The Clinton administration offered oil companies space in the Strategic Petroleum Reserve to store their oil while waiting out the plunge in prices. Department of Energy Secretary Bill Richardson said by allowing companies to use the reserve for storage, the nation will simultaneously shore up its oil supply while helping oil producers stay solvent in an era of devastatingly low oil prices. "With the low-cost crude oil continuing to saturate the petroleum market and private storage space almost completely filled, we have a unique opportunity to take this next step to add to our energy security, " Richardson said. "Although most of the oil we acquire will remain the property of the commercial owner, having it in storage in the Strategic Reserve still provides the nation with enhanced energy protection." The plan, one in a series of initiatives by the administration to help oil producers, sets aside 70 million barrels of space at a site in Beaumont, Texas, for companies seeking to store their oil for at least one year. Companies would pay for the space with oil, rather than cash. Similar offers have been made before, but this one is different, said DOE spokesman Tom Welch. "Last year, we offered space for commercial storage, but it was limited to six months, and we didn't get any takers," Welch said. "Rather than limiting storage to six months, bidding companies can set their own parameters." A representative for the Independent Petroleum Association of America said he understands the administration wants to take advantage of this time to build up its reserves, but he wants to see stronger support for domestic oil producers. Lee Fuller, vice president for government relations at IPAA, also said he hopes the administration is looking to put oil in the reserve that is already on the market, as opposed to encouraging new production. "Then the markets will view (oil stored in the reserve) as oil that's leaving the inventory," Fuller said. "That would be beneficial to reduce the overall inventories throughout the world." DOE's Welch said industry representatives were already expressing their interest in the storage plan, although he declined to reveal how many. He added that Secretary Richardson is expected to address the problems in the oil industry at a meeting with governors from oil-producing states during the National Governors Association gathering this weekend. More help is on the way, Welch added, with another announcement coming as early as Thursday.

To: Razorbak who wrote (37933)	2/21/1999 9:57:00 PM
From: BigBull	Read Replies (1) \| Respond to of 95453

Razor: Interesting isn't it? Under the scenario you suggest ($5 - $6 a barrel): 1.) Venezuela would surely collapse, and take with it probably the whole of South America. 2.) The inflation on the streets of Teheran would approach that of Germany in the thirties. 3.) The Saudi welfare state would disappear, thus forcing it's current residents to return to the idyllic life of the desert bedouin, replete with tents and camels. 4.) Same deal with Kuwait, UAE, Bahrain. 5.) The palestinians would be completely cut off from the subsidies they receive from their gracious rich Arab brothers. 6.) The welfare states built on oil in Alaska, Norway, and Scotland would also collapse leaving those folks in dire economic straits. 7.) Indonesia would cease to exist. 8.) Nigeria would cease to exist. 9.) The debt assumed by all these nations based upon oil "profits" would be repudiated. 10.) Mexico would be very hard pressed, and would also probably collapse. 11.) The financial crises resulting from the above would make the LTC debacle look like a Sunday picnic at the beach. 12.) War would most certainly break out in the middle east. 13.) In all likely hood our Saudi and Kuwaiti Royal friends would be deposed in the ensuing war, leaving the U.S. without a cheap source of foreign oil. All this, so that North Sea producers can be "disciplined". Hey, it's possible! Why not?