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Thread: Crude Oil

  1. #11
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    Today's WrapUp by Jim Willie CB 11.18.2004 Mon Tue Wed Thu Fri Archive


    PUTIN SHAKES THE PETRO-DOLLAR REGIME

    Subtle changes are in the wind on the energy front. As much as some people want to regard Russia as a strong American ally, their behavior on several fronts testifies to the contrary. Some truly staggering developments are underway, not adequately reported. Behind the scenes, covered little by the intrepid US press & media, a meeting was convened two weeks ago in the Urals of Russia. European leaders, and OPEC representatives, and Putin quietly are plotting to establish stronger ties between Europe and Russia in their basis for financial transactions. Putin is adroitly offering to install euro pricing of crude oil, which would surely favor Germany and other large EU nations. He strives to obtain geopolitical concessions from EU leaders, namely a more powerful voice for Russia in world politics.

    OPEC appears to be willing and eager to join in new alliances to undermine the US domination from owning the world reserve currency. Enormous consequences follow, which lie completely in US blind spots. A strange contrasting parallel might exist between the United States and Russia, regarding relationships with large energy companies. The USA has evolved into a cooperative collusion with big companies like Halliburton. Russia has broken down into a confrontational situation steeped in confiscation with big companies like Yukos. The USA seems to work constructively with large firms, with governmental support. This is seen in sponsored foreign grain sales, in development of petro-chemical plants, in defense contracts for the military complex, in permissiveness toward software monopolies, in protection of the steel industry, and elsewhere. Russia seems to work in adversarial roles to steal back and forth with their big firms.

    RUSSIAN ASSAULT ON FREE ENTERPRISE

    Russian legal treachery embodies a big insult to free enterprise and rights to property. One might say Yukos Oil began as a company with stolen property, or cozy deals to gather in several purchases from state-owned regions, or tax scoffs at Russian authorities enabled growth. Fine, whatever. My attention is trained on current methods, which can be aptly labeled as legal warfare, and trends which betray private property. The Yukos tax & fine bill submitted was revealed to be $18.5 billion, which exceeds the company’s annual revenue, and goes far beyond the level where embarrassment is profoundly clear. The Russian government has established a modus operandi, i.e. method of operation. A company is targeted for seizure. It is charged with tax evasion. Their assets are then frozen, pending investigations and legal outcomes. Cash flow is interrupted, only to put debt service repayments in jeopardy. The courts declare debt default, a fresh new problem for the targeted company, whose stock declines in value, and possibly sharply. Under financial duress, a deal is cut, as taxes are paid as a fraction of the original demand in return for a sale of large tracts of the company’s properties to the Russian govt. Charges are reduced or negotiated along with the distress sale of their property. Such a pattern has shown itself clearly with the Yukos case.

    Moreover on the front tied to cooperative agreements, Russia’s treachery is wholly evident in its dealings with western firms. Pan Am Silver was severely victimized, via dissolution of a partner firm and reconstitution of a new corporate entity Polimetall with those mining rights, leaving the US firm out in the cold Siberian winter. PanAm Silver appears not to be in line to share profits where silver production is forthcoming. The original company was dissolved, and along with it, all contracts with PanAm. Czarist gamesmanship with western energy companies is now in focus. British Petroleum is at risk with older contracts, while others like Conoco Philips are at risk with newer contracts. British Petroleum could be in the midst of a bold double-cross, for the craziest of sounding reasons. They exce
    He who lives by the crystal ball soon learns to eat ground glass. (Edgar Fiedler)

  2. #12
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    Oil prices look to be undergoing a blow off top.

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    That's what I'm thinking Packers

    I expect the price to go back down to the low 50's over the next couple of months

    ,
    He who lives by the crystal ball soon learns to eat ground glass. (Edgar Fiedler)

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    Hey, Mick.

    I think if this scenario happens it will affect most energy stocks in the short term: overall it could be a good thing for sharemarkets, however.

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    Hi POK

    The charts are hard to interpret at the moment,
    but I will keep a watch for signs of butterflies.

    I did notice this article if its of any interest.

    http://www.safehaven.com/article-3712.htm

    arco





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    Cheers, Arco.

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    Oil to drop to $US35 next year: Forbes
    http://smh.com.au/articles/2005/08/3...302549456.html

    BHP Billiton CEO expects oil to fall
    http://smh.com.au/articles/2005/08/3...302608530.html

    Seems the 'smart money'[?] on this one is forecasting a fall. Personally I have no idea and don't try and forecast future commodity prices in the short term as there are too many outside unknown factors but one thing that cannot be denied and can be quantified is that demand is outstripping supply. I would prefer to take a 'random walk' on this and feel it could go either way
    The more I learn, the more I realise I don\'t know!!

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    quote:Originally posted by Long Strangle

    quote:Originally posted by Mick100


    That's what I'm thinking Packers

    I expect the price to go back down to the low 50's over the next couple of months

    ,
    Absolutely on way this is going back down to the low 50s this year or next. All date points to it holding current highs, and possible making further highs. Would love to see some research behind your statement.

    I should add that medium/long term i think oil is heading higher but short term I expect a pullback

    Have you heard of the oil indicator? (stephen Leeb)
    It shows that,in the past, if oil rises in price by 80% or more in a 12 month period the result will be a world wide reccession which in turn leads to a drop in demand for oil and thus, lower prices.
    Oil is up over 60% in the last 12 months so it's time to be cautious in my opinion. If oil goes much higher in this run-up I will concider bailing out of my oilers. I hope that I'm right and oil pulls back in price short term.

    ,
    He who lives by the crystal ball soon learns to eat ground glass. (Edgar Fiedler)

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    I have just finished reading Matthew Simmons book "twilight in the desert" and would recommend it as required reading to all those interested or invested in the oil sector.

    It raises a number of questions as to the ability of Saudi Arabia to meet oil demand going forward as well as the high probability that we are close to these fields peaking out.

    I would rate this book 10/10.
    <center>\"I strive to bring glory to the mother country\"</center>

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    Oil below $63 as high prices crimp demand
    Mon Sep 12, 2005 11:40 AM ET
    Printer Friendly | Email Article | Reprints

    By Peg Mackey
    LONDON (Reuters) - Oil prices slumped below $63 a barrel on Monday as signs of a slowdown in global petroleum demand growth countered the struggle to restart U.S. oil facilities after Hurricane Katrina.

    U.S. crude was off $1.23 at $62.85 a barrel. Crude is now $8 below the record high of $70.85 struck on August 30. London Brent crude slipped $1.24 to $61.60.

    Forecasts are that Katrina's destruction could shave 0.5 to 1.0 percentage points off U.S. economic growth in the fourth quarter, further undermining fuel demand just as high prices hit consumption.

    "For the first time, traders have to worry about demand," said Gary Ross, chief executive of U.S. energy consultancy PIRA Energy.

    "There's no doubt there is evidence of demand destruction emerging everywhere. U.S. gasoline data over the next few weeks will show the effect of high oil prices on demand."

    High prices are also eating into Asian oil consumption growth. The International Energy Agency last week has cut its projection for China growth this year by 100,000 bpd to 220,000 bpd. Traders are seeking to move surplus petroleum products from Asia to Atlantic Basin markets.

    China's annual consumer price inflation unexpectedly slowed to 1.3 percent in August from 1.8 percent in July, the National Bureau of Statistics said on Monday. The figure was the lowest since September 2003.

    The IEA last week revised down its forecast for world oil demand growth this year by 250,000 bpd to 1.35 million bpd, compared to 2.9 million bpd last year.
    He who lives by the crystal ball soon learns to eat ground glass. (Edgar Fiedler)

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