Posted on 01/17/2007 1:44:29 PM PST by Ernest_at_the_Beach
NEW DELHI: Volatility in the global oil market is unlikely to affect oil-producing countries' plans to invest billions of dollars to boost capacity, Saudi Arabia's oil minister said Wednesday.
Ali Naimi's comments came a day after he said he didn't see any need as of now for the 12-nation Organization of Petroleum Exporting Countries to discuss new cuts in output a remark that pushed crude oil prices to 19-month lows.
The losses continued Wednesday with the February contract for light sweet crude hitting US$51.17 in electronic trading on the New York Mercantile Exchange.
Despite the falling prices which appeared to be more of the price swings seen on oil markets throughout 2006 Naimi said OPEC members would push ahead with plans to invest billions of dollars to boost capacity so they could meet growing demand, especially from Asian economic powerhouses India and China.
"Producers in general are not moved by a price movement today, tomorrow or next month. We look at the long future," he told reporters in New Delhi, where he was attending an international energy conference. Saudi Arabia is OPEC's biggest producer.
(Excerpt) Read more at iht.com ...
The Saudis are trying to financially hurt Iran. Iran has lots of oil but can't refine it, so they're really losing money in this deal.
Have The Saudis Declared Economic War On Iran?
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Noticed a drop in prices at the gas pump of late? After approaching or even topping $3 a gallon for gasoline, the prices have steadily fallen in recent weeks; stations here in Minnesota had it at $1.89 per gallon over the weekend. The decline at the pump comes from an unexpected glut in the market, and some OPEC producers had hoped to force a round of production cuts to bolster crude prices. However, Saudi Arabia announced today that it had 3 million bbls/day of spare capacity, and it intends to start using it (via Hot Air):
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Closing comments:
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Put this another way; the Iranians contribute around 2.5 million bbls/day, that's less than the Saudi spare capacity. The Saudis have basically pledged to make an Iranian shutdown irrelevant in the short to medium term, taking away one of the Iranian trump cards in their standoff with the West. Sphere It View blog reactions
See #3...for agreement.
The Saudis know for a fact that it will go back up again for Memorial day, and the summer vacation season.It always does.
Thanks for the link to that. Now if the Saudis would stop the preaching of hatred for the infidels in their mosques, I'd start believing they were on our side. As it is, this is a very good start -- what they're doing to Iran, but it's from self-interest with regard to Iran's nuclear power.
If you go to the link you will find that is not what he said. Saudi Arabia's Oil Minister, Ali al-Naimi, said his country has 3 million daily barrels of spare capacity and will push ahead with projects to expand output. He did not say they would start producing the spare capacity. Saudi Arabia has made the largest cuts of any of the OPEC countries and has pledged to continue the additional cuts planned in February.
Saudi Arabia has 3 million daily barrels of spare capacity and will push ahead with projects to expand output, Oil Minister Ali al-Naimi said today.
So I guess CQ rushed to the conclusion a bit early.....
Chavez is in total panic mode right now.
Here is another reason Iran is trying to destroy Iraq:
Iraq oil output hits record level
June 26, 2006
IRAQ'S oil production is now over 2.5 million barrels a day, a record since the fall of Saddam Hussein, the country's oil minister said overnight.
Oil Minister Hussein Shahristani said on US television that Iraq hopes to be producing 4.3 million barrels by 2010 and to be challenging Saudi Arabia as the world's largest producer by 2015.
Production was about 2.5 million barrels a day when president Saddam Hussein was deposed by US-led forces in 2003. It then collapsed to virtually nothing and has been slow to rebuild because of insurgent attacks and other problems.
In an interview with CNN television, Mr Shahristani emphasised that only one month and three days after the Iraqi government took office, "we have been able to break a record".
Pray for W and Our Troops
Yep that's what I assume Cheney was doing in Saudi Arabia back a few months, arranging to squeeze Iran. With all the US hardware in and around the Gulf to add protection, it's a cool plan.
No money, no nukes.
Thanks for the graphs.....
Do you really think the Saudi rulers would rather get big bucks for oil for a few months and then have Iran use their large oil earnings to support a Hamas like organization to overthrow the Saudi Arabian government? Do you really think the royal Saudi family would rather be a bit richer and very dead. The Saudi rulers are not motivated by money. They have more now than they could ever spend.
The Saudi's are selling lots of oil to cut the amount of money Iran has to build Nuclear weapons, and finance attempts to overthrow the Saudi Government. Other governments in the area are concerned by Terrorists supporting Iran. If Iran can do it in Liberia, they can do it in any nation. The Saud's have to take Iran down. They were hoping the Israelis would do it. But they are not likely too. That leaves the Saudis and their oil as the only way to bring the Iranians downfall.
If they take the price low enough the citizens of Iran will overthrow their government.
The Saudi's will pump at capacity as long as the current government is in power in Iran. Kuwait is pumping lots of oil as well, and perhaps some other middle eastern states will soon be pumping at capacity.
It is likely that the price of gasoline will drop to about 20 dollars a barrel. If that does not take down the Iranian regime look for Saudi to pump oil until the price goes to 10 bucks a barrel.
That would take us back to 89 cent a gallon gasoline and bankrupt the Iranian government. Withholding the Iranian's entire production would not bring the price back up. Iran would have to sell their capacity output in hopes of having enough money to stave off rebellion.
The Iranian dictator has threatened his political opponents in Saudi, Kuwait and other the middle eastern nations one time too many.
Interesting Chart.
In 2005 Iran never produced more than an average of 3,950 MBPD and ended the year producing 3,900 MBPD.
http://www.opec.org/home/Monthly%20Oil%20Market%20Reports/2006/pdf/MR012006.pdf
I appreciate that analysis. I have had very or exact thoughts for some time on this one. And have basically in less elegant and detail indicated the Saudi where in for the long haul to offset any Iranian dominance in the area. They much rather deal with the US over the years and receive state of the art weapon/communication/military network systems, and the assurances of continued oil purchases then risk another avenue.
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