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| Caribbean-Latin America |
| Oil prices free fall: Why Venezuela stands to lose the most |
| 2014-10-18 |
| [CSMONITOR] Oil prices continue to slide, putting enormous pressure on oil producers around the world. Soddy Arabia ...a kingdom taking up the bulk of the Arabian peninsula. Its primary economic activity involves exporting oil and soaking Islamic rubes on the annual hajj pilgrimage. The country supports a large number of princes in whatcha might call princely splendor. When the oil runs out the rest of the world is going to kick sand in the Soddy national face... has insisted it is willing to live with lower prices for quite a while as it seeks to maintain a grip on its market share. Kuwait also indicated its willingness to slash prices in order to keep output level. That sent oil prices lower on Oct. 14, as the markets reacted with a bit of surprise to the unwavering stance by OPEC's leading members: WTI dropped 4.5 percent. Lower oil prices are putting a strain on all producers, including Saudi Arabia, but Riyadh is hoping that the economic pain will be much greater for some of its competitors. That includes U.S. shale producers, which have higher average production costs. |
| Posted by:Fred |
| #6 Yes Frank. 100k plus barrels/day to Cuba in exchange for doctors, security expertise and socialist solidarity. Petro Caribe gets a smaller amount on give away terms. China is due over 400k barrels/day in return for loans, the proceeds of which have already been spent. Venezuela also uses 765K barrels of refined transportation fuel per day, essentially giving it away. So not so much to export for cash as ustabe. |
| Posted by: Shipman 2014-10-18 14:05 |
| #5 Only about 4 percent of U.S. shale oil production needs prices above $80 for drillers to break even, the International Energy Agency said today in its monthly oil market report. Producers are getting more oil per dollar spent drilling, driving costs down as much as $30 a barrel since 2012, Morgan Stanley (MS) analyst Adam Longson said in a report yesterday. "Prices aren't low enough to put these projects at risk," Matthew Jurecky, head of oil and gas research for the London-based research company GlobalData Ltd., said by e-mail today from New York. "The profit margin on most commercial unconventional oil plays will support prices as low as $50, many below that even." From U.S. Shale Oil Output Seen Growing Even as Prices Drop |
| Posted by: Woozle Glereng6363 2014-10-18 13:59 |
| #4 plus - haven't they already promised a lotta cut-rate oil to Cuba and China? |
| Posted by: Frank G on the road 2014-10-18 10:48 |
| #3 ..yep, the barter market, oil for 'security personnel'. Works. |
| Posted by: Procopius2k 2014-10-18 08:49 |
| #2 The problem is Venezuela's production infrastructure is breaking down, and no one will sell anything to them except cash in advance. Mainly because they have a history of not paying. On the up side, now they can give Cuba all the oil they want. |
| Posted by: ed in texas 2014-10-18 08:02 |
| #1 No worries for any of them as the margins are still there: Saudi Arabian crude is the cheapest in the world to extract because of its location near the surface of the desert and the size of the fields, which allow economies of scale. The operating cost (stripping out capital expenditure) of extracting a barrel in Saudi Arabia has been estimated to be around $1-$2, and the total cost (including capital expenditure) $4-$6 a barrel. In Venezuela, where fields tend to be mature and small and it is difficult to make new discoveries, production costs were generally estimated at $20 a barrel (operating and capital costs). Those figures do not include the more expensive Orinoco oil from the country's sand deposits. One analyst said the extraction of one barrel of Orinoco was around $30 (operating and capital costs). |
| Posted by: Airandee 2014-10-18 07:54 |