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| Arabia |
| Oil prices fall despite Opec output cut |
| 2004-03-31 |
| I’m posting this under Arabia because of the clear signs that the Saudis intend to move prices up - a shift from their historic role. World oil prices slipped back on Wednesday, despite Opec’s decision to cut output by 1m barrels a day, as the market reacted to higher-than-expected US crude stocks. In New York, crude contracts for May delivery were down $1.15 by late morning, at $35.10 per barrel. The drop followed news that US crude oil stocks increased to their highest levels since Augusts 2002 in the week ending March 26, up 5.7m barrels to 294.3m barrels. Earlier, in a statement after its Vienna meeting, Opec confirmed it had agreed to reduce output to a total of 23.5m barrels a day, with immediate effect. The statement blamed current high oil prices on speculation on energy futures markets and concerns over US gasoline supplies. Saudi Arabia, the world’s biggest exporter of oil and Opec’s most influential member, denied claims made in the media that it had led the decision to cut output. mmmm hmmmm .... "I think all of this reporting contributed to major misunderstanding of Saudi about leading Opec to decrease production. Let me say exactly that this is incorrect. Saudi Arabia is not leading anybody," said Ali Naimi, Saudi Arabia’s energy minister. Nope. Not us. Ain’t no major market movers here in the magical Kingdom. Nobody here but us romantic Bedouin tribesmen, full of virility and honorable code of the desert & stuff. In Washington, the White House said it had not sought directly to persuade Opec not to cut output. Scott McClellan, the White House spokesman, said the administration "remained engaged in close discussion with major producers from around the world. We believe oil prices should be set by market forces in order to make sure that we have adequate supplies available." President George W. Bush "is concerned about rising gas prices". Meanwhile, investment banks have begun to predict that oil will this year have an increasing impact on the world’s economic recovery. Goldman Sachs estimates that growth in the Group of Seven industrial countries will be 0.3 per cent lower in the next 9-12 months because of the rise in oil prices. In the US, the bank believes the fading effect of the tax cuts will bring the pinch to real incomes to the fore. Michael Rothman, analyst at Merrill Lynch, agreed with Opec’s assertion that it was only partly responsible for the rise in oil prices. Mr Rothman believes $5-$7 of the price is attributable to hedge funds, that have entered the market in record numbers. Some funds are seeking a sanctuary from a falling dollar by investing in oil futures - whose prices go up as the greenback falls. "Opec’s real dilemma is trying to get people to understand the difference between a cut that meets market requirements or a cut in supply that makes the market have to scramble for barrels," Mr Rothman said. He calculated that if Opec failed to cut 1.7-2m barrels of its output in the coming months it would face a 2m b/d build in oil inventories in consuming countries - in addition to the usual season increase of 900,000 b/d. Oil inventories usually increase in the spring as the northern hemisphere no longer requires winter heating oil and the summer driving season has not yet kicked into gear in the US. Saudi Arabia and Opec are keen to keep inventories as low as possible because it gives them more control over the market. Fathi Hamed Ben Shatwan, Libya’s energy minister, on Tuesday said that 1m b/d represented only 1.5 per cent of the worldwide supply: "If we cut it, it’s no problem. If we leave it, it will be accumulated in stocks and these will affect the price." Many Opec countries, but especially Libya and Algeria, who pay for many of their imports in euros, stress that the price of oil is in reality 30 per cent lower than the current level because of the recent steep fall in the dollar. Non-Opec countries that in the past have co-operated with the cartel, on Tuesday did not appear as eager to join the cuts. Russia criticised Opec, saying prices were too high, but Mexico said it wanted market stability, adding that the cartel had not yet reached a formal decision. Mexico said it was co-operating with Opec by meeting with Saudi Arabia, but has so far decided not to join the cuts. And if you do, there is an immigration proposal the US might want to reconsider. |
| Posted by:rkb |
| #7 Nine more Americans died today because of Jewsih lies about WMD while Mr. Pruitt censors the truth. PLEASE NOTE: Delete space in censored URL below. http://AD LU SA.com |
| Posted by: John TROLL 2004-03-31 3:02:46 PM |
| #6 Mexico is an aly, just like France. But they should get opposite immigration treatment. Green cards to all French college grads, a wall for Mexico. Perhaps we can license the design from Sharon. |
| Posted by: Mr. Davis 2004-03-31 10:53:02 PM |
| #5 The last time the gas prices were sky-high in Chicago, it was because of a pipeline problem somewhere down around St. Louis. I s'pose we had to truck our oh-so-special formulation of gas to get it here. Hence a higher price. Right now I can deal. Drudge had a picture that made me flinch. Not so much that the sign said more than $3/gallon. No, it was that wherever it was still had full-service, which was 50 cents or more higher than self-serve. |
| Posted by: eLarson 2004-03-31 6:52:34 PM |
| #4 well i guess john aka franklin troll was deleted-- so never mind my above rant....really pisses me off when i hear we were lied to..i believe in facts.... |
| Posted by: Dan 2004-03-31 5:56:36 PM |
| #3 John - you really believe this shit. we were lied about wmd .... tell me when did this happen? Bush stated we would pre-empt nations in their pursuit of wmd..hell even clinton admitted that iraq had wmd... your a dumbass that will swallow all that moveon.org puts out. analyze the actual facts and repost...plus this post is about opec cuts and not your moronic mantra of 'Jewish lies'..what a dumbass.. put your actions where your mouth is and go get in front of a jewesh bulldozer! saddam did have wmd and if let loose of un sanctions and us/brit protective zones would of been an even nastier enemy..and his status would in the arab world would be elevated..now his image is of being checked for lice! |
| Posted by: Dan 2004-03-31 3:18:32 PM |
| #2 when is the average american going to understand that oil prices of late have had nothing to with actual supply. for the last two quaters the sods have actively pursured a policy of cutting back. traditionally this time of the year see's an increase in production and the markets stay stable. but because Bush is pushing the ragheads to reforms through diplomacy and/or force the sods want him out of office. thier thinking is if the american public hurts in the wallet due to higher oil prices we will vote Bush out of office. i sure hope that after november the heat is really poured on the sods. |
| Posted by: Dan 2004-03-31 3:12:57 PM |
| #1 [Troll droppings deleted] |
| Posted by: Franklin TROLL 2004-03-31 3:02:46 PM |