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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Robert Douglas who wrote (8397)	3/22/1999 6:51:00 PM
From: Ramsey Su	Read Replies (1) \| Respond to of 9980

Robert, I have never followed oil as a commodity nor any oil stocks so I have only questions, no answers. My first question after oil price is back to the good old supply and demand. So through price fixing, OPEC is going to jack up the price. For the US and other oil consuming nations, we will have some inflation pressures, not good. For the Asian nations, such as Japan and China, their demand is not high already and will react to price pressure accordingly. So how is this going to help Asia recover? Selling less oil at a higher price nets the same as selling more oil at a lower price. I see the Saudis and may be a few Arab countries being the big benefactor, while others such as Mexico, Venezuela, Indonesia, Russia, as the big losers. Will you or any oil experts enlighten me? Ramsey

To: Robert Douglas who wrote (8397)	3/22/1999 8:01:00 PM
From: Ramsey Su	Respond to of 9980

If Asia does recover, as I anticipate, Robert, I think the contrary is about to happen. scmp.com Lots of really bad news, despite of all the positive jawboning. Ramsey

To: Robert Douglas who wrote (8397)	3/22/1999 8:33:00 PM
From: Stitch	Read Replies (1) \| Respond to of 9980

Robert, <<What I am wondering about lately is whether what we have just seen in the price of oil will be become a pattern for other commodities in the next few years? >> <<It's textbook economics really.>> I have to be careful in commenting on the above, so as not to over trivialize but I agree. I have long maintained that the Asian economic collapse was going to resolve into a singular opportunity for investors and still believe so. Through much of the first 18 months after the devaluation of the Thai baht, that many people mistakingly regard as the beginning of the crisis, I thought the opportunities would present themselves in Asian issues. I watched companies like Sime Darby, UCOM-Thailand, and other regional issues. But now my attention has turned to investments that I believe offer more safety (read transparency) and oil is one of the sectors I believe in. The other that I am starting to look at is pulp and paper. Best, Stitch

To: Robert Douglas who wrote (8397)	3/23/1999 4:19:00 AM
From: nihil	Read Replies (1) \| Respond to of 9980

<<It's textbook economics really.>> The (U.S.) textbook prescription is that the political problems of maintaining a producer cartel are insuperable in the long-run. There are a few exceptions where the potential suppliers are so few that mutual control of supply is at least conceivable. But in general, undocumented cartels are illegal under the trade laws of most customers, and documented cartels (international agreements) have to consider interests of the buy side. Each commodity is subject to different supply and technology conditions. Even if existing supply and price are regulated, new suppliers and technologies allow for competition and new entry. Long-run price forecasting is hopeless. When I was forecasting oil prices 25 years ago my grantor (NSF) refused to allow me forecast the effects of prices as low as they actually turned out to be in 1985. The future is not only stanger than you think -- it is stranger than you can think.