NZ Oil & Gas (NZO)

**manxman** · 10-09-2007, 07:56 AM

TEL AVIV (MarketWatch) -- Oil supplies are sufficient, with commercial inventories in industrialized countries higher than they've been for five years, but a lack of refining capacity is helping keep prices high, OPEC President Mohammed al-Hamli said on Sunday, according to Reuters.

http://www.aip.com.au/pricing/marketwatch.htm shows diesel prices AU$15 above TAPIS crude while mogas has no margin at all. Anyone else recall a year or so ago when mogas was dearer than diesel?

The long and the short of it is that with severe refining capacity restraints on high spec diesel, the premium on light sweet crudes should hold or increase. (and refinery profits will gravitate to those refineries which can make sweet diesel from heavy sour crudes - NZR is doing

)

Looking forward to the AGM when we should get an interesting update.

Mx

**digger** · 10-09-2007, 08:12 PM

Originally Posted by arjay

Another Hamilton poster recently said they'd been to see the movie "A Crude Awakening" at the Rialto and commented that there were only 4 other people in the theatre. I'm pleased to report that I saw it today at another cinema and the numbers of viewers in the theatre had swelled to 7. A rather sobering movie. The message I got is that we're running out of oil, it's gonna cause a crisis within a few short years, and no-one cares. An interesting angle is that politicians aren't ging to do anything that will make them unpopular (we know that already) so they won't address the issue until the electorate tells them they will support them if they take steps to deal with the problem. Problem is that the public don't care enough to make that phone-call to the politicians (except for the Greens perhaps, but they don't get supported by people with property to protect). In the same vein, I suspect that if tomorrow the sub-prime hammers the market again, the flock will head for bank deposits rather than investing in shares that become more valuable with increasing oil price and decreasing $NZ.

Hi Arjay,it was me ,wife and two accidental people at the first screening of Crude Awakening.Just thought i would point out that you have increased the first crowd by 25%,where you said only 4 other people in theatre.There was 4 in total. The other couple were going to the movies and did not know what the movie was about.He found it very interesting and she thought for a sat nite it was not a pleasent movie. A bit worrting and chose not to think about it.The roads after the movie were blocked solid with traffic from the rugby shield match.
Such is the state of awareness on peak oil in NZ. I say about another 3 years and the general population will not be able to hide from the problem any longer.Then it will be the Crude Awakening in the pocket book. Better hang on to those NZO shares.

**Zorbah** · 10-09-2007, 10:29 PM

.
Saw the Crude Awakening movie at the Academy this evening -- 4 people all told. Its crazy, everybody should see this movie, especially politicians. After the movie I suggested to the guy running the Academy that politicians should see it for free --- he was not impressed.

Movie was really sobering and thought-provoking. Has amazing historical footage as well as up to date analysis by people like Matt Simmons and Colin Campbell, as well as ex OPEC officials.

Simmons was credited as an energy banker and an "advisor to Geroge W Bush". Movie also featured a republican Senator who is very concerned, so its not all pink liberal "commie" propagander as the some of the conservative voices would have us believe.

Here is a link for the movie:

http://www.oilcrashmovie.com/index2.html

**digger** · 11-09-2007, 09:54 AM

Now that Zobra and Arjay then Bermuda and a small handful of others have seen Crude Awakening,that will mean that all that really do not need to see the movie have and those that urgently need to will just remain in the dark. I think only a very high oil price will wake people up.
WTI at 78.5 this morning after some more explosions in Mexico,so maybe the Crude Awakening is not far away.Also today OPEC will announce the expected no increase in output after there meeting.The world will confused unable to increase for will not increase.The difference is hugh but for another 6 months or so we can go on believing all is well with oil supply----if only the Saudis would do as they are told.

**Zorbah** · 11-09-2007, 09:56 AM

.
Nymex back over US$78 / barrel !!

One good huricane in the GoM and US$80 will be breached.

http://www.bloomberg.com/markets/com...rgyprices.html

Opec quotas likely to remain unchanged:

http://www.bloomberg.com/apps/news?p...E&refer=energy

**manxman** · 11-09-2007, 10:02 AM

Looking at an old Economist. Oil was $15/barrel in May 1999. Its gone up fivefold without making a discernable change in consumption habits. Somewhere there is a big fan - waiting...

**duncan macgregor** · 11-09-2007, 10:23 AM

Originally Posted by manxman

Looking at an old Economist. Oil was $15/barrel in May 1999. Its gone up fivefold without making a discernable change in consumption habits. Somewhere there is a big fan - waiting...

The price of oil wont make to much difference to your oil shares. The companies will be spending more finding less, or do you think they will stand still until they go under with nothing left to sell?. The various GOVTS will tax the last oil to the hilt. The shareholders will be left as usual in the end with slim pickings. Most of the oil is undiscovered in the artic and antartic regions of the world so look forward to a bit of global warming to uncover that lot. Lots of water to flow under the bridge before we need to really be concerned. With NZO we know what they have got, but whats next is more to the point, where to from here?. Macdunk

**bermuda** · 11-09-2007, 10:25 AM

There is no doubt supplies are tightening and judging from the lack of interest from the public to a 'crude awakening' life will go on as normal until one day in the not too distant future when Bush tries to enforce an oil law in Iraq. The Iraq's will go on strike and the price of oil will climb and there may be possible shortages. i.e. no fuel at the gas station.

That will be a big wake up call but we will get by for a while as even a 10% reduction in consumption will provide the world with a 8.6 million barrel per day cushion. Everyone can do it but can the Chinese and Indians? So sooner or later this cushion will be removed and so the cycle will repeat itself. The trouble is it is going to take 15-20 years hard endeavour to come up with alternatives.

We need to act now and not just look at weak alternatives like biofuel from food crops which is an absolute waste of areable land.

The real answer lies in reducing our population before a lack of energy reduces it for us.

Good to see NZO putting $$$ in the bank at record prices and a better exchange rate. If the forecast 30% increase in coking coal comes off then expect a jump in PRC's fortunes and a corresponding lift in NZO.

A lot of 2nd to 3rd world countries have a staggering 5-6 children. We have to educate the world.

**shasta** · 11-09-2007, 10:40 AM

Originally Posted by duncan macgregor

The price of oil wont make to much difference to your oil shares. The companies will be spending more finding less, or do you think they will stand still until they go under with nothing left to sell?. The various GOVTS will tax the last oil to the hilt. The shareholders will be left as usual in the end with slim pickings. Most of the oil is undiscovered in the artic and antartic regions of the world so look forward to a bit of global warming to uncover that lot. Lots of water to flow under the bridge before we need to really be concerned. With NZO we know what they have got, but whats next is more to the point, where to from here?. Macdunk

Macdunk

You seem to be contradicting yourself, on one hand you are saying an oil producer isnt bound by the price of oil, & therefore FX (primarily $US rates?)

Yet, you say Nickel/Zinc etc stocks move based on the DOW, & commodity prices & again FX rates, ie they do make a difference?

There is a correlation between the two, & remember the tax/royalty regime for projects like Kupe is on better terms than "normal".

Govt's have had to reduce the taxes/royalties to stimulate exploration activity to some extent.