Skip to comments.SHIPPING CEO: Iran Could Send Oil To $440/Barrel
Posted on 03/05/2012 6:10:14 AM PST by blam
SHIPPING CEO: Iran Could Send Oil To $440/Barrel
March 5, 2012
The scariest Iran scenario yet comes from Bob Bandos, CEO of marine logistics and services company GAC North America.
Bandos tells Pierre Bertrand of the International Business Times:
[T]ankers can haul 1.8 million barrels of oil a day through the strait. If that supply is choked off, the effect would be similar to the fuel shortages of the 1970s - but more extreme, Bandos said.
"That would be nothing compared to this," Bandos said, who added the shortage would be global.
If the 1973 embargo experience repeats itself, the price of a barrel of oil could soar to $440 a barrel.
This scenario is more bearish than we've heard from most banks. Societe Generale, for instance, said oil could rise to $200 were the Strait closed. Of course the $440 figure was picked up by the pro-Iranian Tehran Times (via @DougKass).
(Excerpt) Read more at businessinsider.com ...
A military strike will be made on Iran's nuclear facilities about the middle of April.
Iran will manage to close the Strait Of Hormuz but, not for long.
I think only about 14% of our (USA) oil comes through the Strait Of Hormuz.
(On a interesting little side note, the Persian Gulf was bone dry during the Ice Age)
No, oil will not come close to 440.
The world economy dies at about 200 a barrell, if not sooner. Folks won’t go anywhere or buy anything they don’t absolutely have to. And they’ll buy less of that.
Good thing I didn’t need any gas during the ice age!!
Tend to agree. They can try but it won’t stay closed for long. However, oil being fungible it doesn’t matter what percent of oil comes from where. If global supply is effected, global price will go up, regardless of who gets which oil from where.
Interesting little side note? WTF? Relevance? ;o}
“Iran Could Send Oil To $440”. “I think only about 14% of our (USA) oil comes through the Strait Of Hormuz.” .......................................... LOL, at $440 a barrel our domestic oil will be sent over seas. 90 % of our oil will be exported and 10% will be left for our gasoline consumption at $20+ a gallon. :(
We’d be in a pretty good position right now if USA was a major crude oil exporter. Can you imagine if we had about 10 ro 15 million barrels a day to be able to export from American Companies based off American shores?
This entire issue in the ME would be a good economic thing for us. Kind of makes you wonder what Russia and China’s interest in preserving the caos is, huh.
No way. There is no way we are striking Iran.
Put another way:
Newt Here. Newt Now. Pay Less.
I would bet it is less than that more like 8%.
But here is our problem; the countries who are denied the oil will have to pay higher prices.
The countries who are presently supplying us will continue to do it if we pay the higher prices. Otherwise they will ship oil to the Europeans and others who are cut off. These oil companies are in business to make money, not to be nice guys. -Tom
I agree with you on this (and most everything you post). Oil at 440 a barrel would be priced so far out of the realm of reality, that EVERYTHING would shut down. Literally, no one would be able to buy anything, and most would be unable to drive to work. Some people now may spend several hundred a month in gas to go to work (When I lived in the metro area, and gas was back at $2.50/gallon a few years ago, I spent nearly $300/month, and that was in a gas-saving Corolla!). If gas quadrupled, I sure as heck could not have afforded the extra $500-1000/month (depending on how much other driving I cut out), and It may have actually paid off to NOT go into work some days (this was many years ago, when I had just started a new job and didn’t make much money).
Anyway, you’re absolutely correct. The world literally runs off of cheap transportation. If we don’t have it, people are going to get really feisty, really quick. No more cheap fuel, means no more cheap food. And if food isn’t cheap, and people are starving, it’ll be World War 3 in a matter of weeks, if not days.
If not a doomsday prepper, they’ll at least become a hunker down and waiter....people who make these predictions clearly do not live in the real world. They act like its just “pain at the pump” without realizing it is devastation and the very foundation of our economy and our liberty.
Don’t bet on that, not in the slightest. “Dear Leader” will go to any war his task masters demand of him, and you can take that to the bank. It’ll be sooner, rather than later, mind you.
Thought you might like this ping as an FYI.
Very good point. People need to understand that oil is fungible and when theres not enough of it, everyone who buys it will pay that premium.
And actually its not just oil. To some degree, all energy is fungible. If we had more drilling and more nuclear and more coal and nat gas, ALL OF IT would be much less expensive because many fuel usages can use multiple sources (like elec utilities for instance).
And unfortunately, those people who become “preppers” at that point, will have decided to prepare when it’s already too late. As they say, “When the time for performance has come, the time for preparation has passed.” We’ve been warning people for years that the gap was closing, but the “let the good times roll” crowd was too busy living high on the Chinese-indebted hog. Well, that gravy train has left the station, and whether we go to war with Iran or not (we will), the debt chickens WILL come home to roost as the Fed prints money to cover the deficit spending the Chinese have walked out on.
The Titannic is sinking one way or another. For those that are already in the lifeboats, it’s time to be paddling. For those who aren’t in, I sure hope you’re moving towards them. And for everyone else who doesn’t care to prepare, grab your neighbor and pray for repentance when the SHTF, because you waited way, way, too long.
While we may not rely on the straits for our oil it will impact our ability to have oil as the prices will sky rocket and we could sell it to China to make money of the oil we have here.
This would/could lead us to a global depression.
Marked for future reference...
There's always a 'bonus' when reading my posts.
The Strait Of Hormuz must be crossed to get to the Persian Gulf and the oil terminals. Only 10,000 years ago, there wasn't a Persian Gulf.
I didn't say who would strike.
This is exactly why the American people need to control their own oil. It is not a world commodity. It belongs to us and OPEC doesn’t tell us what to do. That’s the stance we need to take.
I hope you are wrong, but you may well be on the money.
How fortunate for us that there is no good way of utilizing virtually unlimited methane hydrates.
In some crazy universe one could use methane hydrates to create ultra clean diesel and with hybrid ele diesel engines even trucks would be getting to 30mpg ranges
But thats crazy talk
P.S. And thank you for all of these articles you’ve been posting. We almost need a “blam” ping list or keyword. You do us all a great service, and I wanted to say “Thank You.” I just worry I miss out on a lot of these articles you’ve been posting, as I have to stumble upon them, lol.
The Driver Ant (Siafu), when placed near a lacerated flesh wound will instinctively drive it's pincers into the flesh and pull the wound together. The body can then be removed from the head and the would will remain closed to heal.
Gas hit $3.99 Friday and now, other than the to/from work hour, the roads are deserted. Nobody is going anywhere except work.
Two months of $4 gas will crash the economy in rural states where people have to drive long distances to work. All their extra money gets spent on gas and gas related inflation.
Since we don't have a Nationalized oil industry in this county, the oil belongs to the oil companies foreign and domestic who are drilling here in the United states.
You and I don't own the oil and neither does the US Govt.
So if the oil companies, can get a higher price outside this country, oil pumped in the United States could be shipped elsewhere. - Tom
OK Tom, you are right - but you are scaring me here a bit. Are you saying it is a good thing or a bad thing that we don't have a nationalized oil industry?
And wouldn't more supply solve the problem anyway?
There you go.
See what I mean about a bonus...thanks.
Now, If I told you I have an aspirin tree in my yard, what kind of tree do I have?(Preppers ought to know this.)
(ahem)The Chevy Volt people won't have this problem, will they?
No those volt people won’t, they don’t live in rural states.
Ahhhh! Willow bark tea! Been around a long, long time!
I don't believe we should have a nationalized oil industry.
The oil companies have to do a balancing act, because if they appear to be too greedy, and the price of gasoline at the pump skyrockets, nationalizing the oil industry is a tailor made issue to demagogue. Perfect for class warfare. There are a lot more voting Joe-six packs in the country than millionaires. And there is nothing that appeals to most voters like voting themselves some one else's money.- Tom
I agree. I, too, live in a rural area, and have noticed the same trend. The gas here’s only $3.50 or so, but it’s still a big drain. Likewise, I don’t see people going “into town” as much anymore (my household included), and that’s not a good sign.
There is an Arabian Gulf Pipeline project underway to
bypass the Hormuz Strait bottleneck.
The willow tree produces salicylic acid in the bark which is a raw and unrefined equivalent to aspirin.
I think we have sufficiently hijacked the thread.
I can't tell if you are a proponent of nationalized oil. It's a bad idea.
Here is a few things you are missing in the grand scheme about free market (which is arguable about oil).
The oil company is going to get the current going market rate from most depending on the futures price set by investors (60% anyway). Otherwise, contracts are written to agreed upon rates. The oil companies then have their established sales rate. Their next goal is to economize the cost of getting the product from the earth to the customer. Pumping and shipping for refinement is a large cost. There is more profit to be made from a company pumping in the gulf and shipping to Houston than to China or Russia. The second part of the equation that affects the price we pay at the pump is the futures market. That is a highly emotional driven component. Speculators gamble on supply and demand to place their bets. If America were to some day announce, "All regulations on oil exploration, extraction, refinement, shipping and oversight are hereby rescinded. And there are no longer any permits required and civil lawsuits against oil companies are illegal." speculators would drop dead of angina first. Then you would see the price of oil drop dramatically. Why? The speculation is that America could significantly unleash a new chunk of supply into the world market. More supply feeds demand and increases competition. It's a complicated formula. But Americans would certainly feel the positive impact of American companies expanding extraction and refinement in the US.
And I am of the opinion Israel will not either. They have no carriers. Their flight path takes them over areas WE control...OR Arab's Control...and it's a lot longer trip than it was in 1981. They would need our help...and we will not give it to them. We have put up every roadblock we can to hinder their planning.
Look at the flight path and think of the logistics. It could only be done with a carrier (which they don't have)...or our help (which we won't give).
I HOPE I am wrong...but I think they try to take down the Iranians with continued Mossad tactics.
The current action in Syria (ahem) will be complete by the middle of April.
It's actually a way to bump your own thread without it looking like that's what you're doing.