Posts by Kanagawa

Oil demand forecast is at 85.21 mil barrels per day, says OPEC

VIENNA: The Organisation of the Petroleum Exporting Countries (OPEC) maintains unchanged its forecast on world oil demand for 2010 at 85.21 million barrels per day (mbpd), Algerian Press Service (APS) reported.

It is an increase of 0.9 million mbp in comparison with 2009.

According to April’s monthly report released on Wednesday here, OPEC said the oil demand remains prudent on the pace of world economic recovery.

“In 2010, world oil consumption should increase by 0.9 million barrels per day, in conformity with our previous forecasts,” oil cartel experts said.

However, the experts added that “the economic activities in the US are still representing the point of interrogation for the progress of world demand.” -- Bernama

This is an extract from : http://thestar.com.my/news/story.asp…4547&sec=nation

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Oil & Gas Jobs

I read the Goldman Sachs news whioch said :
Goldman Sachs says that one barrel of West Texas Intermediate oil, which is used as the benchmark price for crude, will cost $90 in 2010, up from the $70 to $80 price range crude oil has been selling at for the past few months.

Which month are they talking about? Are they talking of any particular month or average price for the year?

Hello all the fans out there.

I have been analysing the oil price forecast of year ending 2009 which is above.

40% of the votes so far said that the crude oil price would be between $76 & $85
23% of the votes so far said that the crude oil price would be between $66 & $75

The year has not ended yet and it is now USD 74.
OPEC is very happy. They muy not change anything at the Angola summit.

I did expect some change after the Copenhagen Climate Change Summit. But did not see anything significant.

I would safey assume that we may be at USD 76 at the end of the year.

Any comments?

This is an extract from AFP news at http://www.google.com/hostednews/afp…_eObfBGmJgq7HEg

ISTANBUL — Oil prices are expected to average 63 dollars in 2010, after 55.5 dollars in 2009, the World Bank said in a report on the Middle East and North Africa released in Istanbul on Saturday.

Those prices are "sufficient to avoid a major crisis in oil-producing countries, but much lower than the boom of 2008," said the "Economic Development and Prospects" report.

The World Bank said that oil prices in 2009 were unlikely to be significantly affected by the factors that had contributed to high prices before mid-2008.

"Global demand is likely to remain low," said the report, released in the run-up to the World Bank and International Monetary Fund annual meetings in the Turkish financial capital.

The IMF did not provide oil price projections for 2010 in its semi-annual World Economic Outlook report, published Thursday.

According to its WEO report, global oil demand is expected to rise to 85.7 million barrels per day in 2010 from 84.4 mbpd in 2009, but still be below the 2008 level of 86.3 mbpd.

Oil prices dropped below 70 dollars a barrel Friday after the US government reported worse than expected unemployment data that hammered economic recovery hopes for the world's largest energy-consuming nation.

During an eleven-day tour of Eurasia, Venezuelan President Hugo Chavez promoted the transformation of the Gas Exporting Countries Forum (GECF) into a cartel similar to the Organisation of Petroleum Exporting Countries (OPEC). Chavez said the aim of his tour was to counter U.S. economic and political dominance and promote a multi-polar world.

The GECF, which groups Algeria, Bolivia, Brunei, Egypt, Equatorial Guinea, Iran, Libya, Malaysia, Nigeria, Qatar, Russia, Trinidad and Tobago, the United Arab Emirates and Venezuela, was created as a formal organisation to coordinate gas policy between member countries during a meeting hosted by Russia last December.

Chavez, who arrived in Moscow on Wednesday for a two day visit, is expected to call for the GFEC to operate more along the lines of OPEC, where member countries meet regularly to set production quotas in order to influence the price of crude oil on global markets.

This is an extract from http://www.venezuelanalysis.com/news/4784

I have not found anything much on this. But there is an old document here :
<link removed>

Personally, I think it is quite likely that an OGEC will emerge as the energy demand rises.
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Worldoils Notes : https://www.worldoils.com/oilresearch.php

This is an extract from http://uk.reuters.com/article/oilRpt/idUKL49836420090204

An oil pipeline intended to link the Caspian basin and Italy appears to be in doubt due to a lack of clear commitment from the partners, the head of Croatian oil pipeline operator Janaf JANF.ZA said on Wednesday.

Croatia, Romania, Serbia, Slovenia and Italy signed an agreement in 2007 on building the Pan-European Oil Pipeline (PEOP) to bring crude from the Caspian basin via the Romanian Black Sea port of Constanta to Trieste in Italy.

First projections said it could become operational in 2012.

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Apparently, there seems to be some confusion in the completion.

Speaking of oil reserves :

It is now nearly 6 years since since the US-led invasion in Iraq. Now Iraq has started re-opening its oil reserves to foreign companies.

The country has begun a round of bidding for some of its largest oil and natural gas fields. Understand that the deals will be awarded by June.

My thoughts : With the oil prices at around $40 now, will companies take the risk unless they see a huge rise in oil prices? Notg many companies, I think.

Comments, anyone?

For a very long time there has been great resistance to the exploration off the Florida Coast. Looks like it will hange.

Here is an extract from this piece : http://www2.tbo.com/content/2008/n…orses-drilling/

It says :

A Florida Tourism group has endorsed an idea that politicians and environmentalists have been trying to prevent for decades: the exploration and production of oil and natural gas in the waters off Florida's Gulf Coast.

State tourism officials long have opposed drilling off Florida's shores, but the Florida Association of Convention and Visitors Bureaus now says drilling will help preserve the state's No. 1 industry.

"Changes in global energy markets have affected the price and supply of oil and natural gas and subsequently may have a future impact on Florida's tourism industry," the association said in a three-page position statement.

The association said it would support offshore drilling and production, but the operations must be at least 30 miles from the coastline.
Florida's $65 billion-a-year tourism industry employs nearly 1 million people.

Is it worth taking the risk?

Ok. Let us face the facts...

Oil prices slid even after the oil output cut. So much for the economics we learnt at the university.
But this needs more factors to be added to make the present day economic theory workable.

Has there been a testing time in the past when so many factors worked against the world economy?
Morgage crisis
Credit crunch
Stock market slide
Bankruptcies
and most important - negative sentiment

Somebody in this forum has predicted $55 per barrel. Maybe it will be true?
The reason - people have been cutting on expenses and will keep cutting more.

My feeling - year end price $70. Anybody else has comments?

Following are the factors that affect the oil prices :

1. Supply shortage.
2. Taxes.
3. Market sentiment/speculation.
4. Accidents.
5. Adverse weather.
6. Increasing or decreasing demand.
7. Speed of the transport system that delivers oil.
8. Labour disputes and other production disruptions.
9. Wars & political disturbances.
10. Natural disasters.

So, OPEC or not, tehre are still other factors that will increase/decrease consumption and will affect the oil prices.

Hey...

Get out of your armchair now and stop dreaming (and smoking). There is a negative sentiment at the moment. Oil can never hit that low again. Unless the OPEC crumbles....

In an article published on 2nd of October 2008, it is written :
"The current financial market meltdown being witnessed in the United States and other advanced economies will likely lead to longer and deeper economic downturns in some of these countries, according to new IMF research."

"Economies like the United States, with more arms-length or market-based financial systems, seem to be particularly vulnerable to sharp contractions in activity in the face of financial stress," Charles Collyns, Deputy Director in the IMF's Research Department, said at a press briefing today. Citing the chapter, "Financial Stress and Economic Downturns," he added that "this is because leverage tends to be more procyclical in these economies, which means that when a shock hits the financial system, the process of deleveraging can be more severe, and the risks of a credit crunch are greater."

Worldoils Notes :https://www.worldoils.com/newsletter.php

The consumer optimisim has paid off.

The price of oil actually touched as low as $98 today. Motorists can rejoice.
But we are looking at below $90 as the next step. Let us wait and watch.

RDS & Conoco Philips announced that hurricane Gustav caused no damage to the platforms in the Gulf of Mexico. However, this did not change the oil prices much. Partly because there are more hurricanes possible as the huricane season is not over. Ike and Josephine are approaching.

Other serious factors - rising dollar and the falling Euro. We are seeing an economic slowdown in Europe.

Can we test $100 a barrel?

For those of you who are looking for the latest in drilling technology, here may be a new tool...

Following was reported on 27th August 2008 in Pennergy :

Quote :

M-I Swaco also has announced a radio frequency identification (RFID) activated circulating valve for drilling and pre-completion wellbore cleaning. The IntelliForce CCV opens and closes by sending a RFID activation tag into the well fluid and pumping it through the tool. Each tag is programmed to open or close ports on a specific tool.

The IntelliForce CCV tool holds a power source, electro-hydraulic system, and sliding sleeve. The RFID tag causes the hydraulic system to move the sleeve to open or close circulating ports.

Unquote

Good use of RFID for activating downhole equipment.

Gustav approaching.

Crude prices are above 119. It does not seem that speculation is working much this time.
It is the storm and the falling U.S. inventory fanned by the weaker dollar.

The hurrican season will continue another few months. Watch the rally.

Go to the Worldoils events. I think the page is https://www.worldoils.com/oilevents.php or something like that.

Look for an LNG conference in October 2008 at Rotterdam. Look there. I am sure there is one...

Baku-Tbilisi-Ceyhan [BTC] Pipeline has been damaged. This is the first direct pipeline transporting crude from the Caspian Sea to the Mediterranean Sea without crossing the Russian territory.

The details of the pipeline :
Total length : 1,100 miles ( 443km through Azerbaijan, 249km through Georgia and 1,076km through Turkey).
End point : Ceyhan terminal, Turkey.
Cost : Nearly $ 4 billion
Peak capacity : 1 million bbl/day

The capacity of this pipeline is over 1% per day. Any disruption to this pipeline, i think, will have affect ton he oil prices

One consideration : How difficult would it be to protect a 1,100 mile long pipeline? Would it not be vulnerable even for small forces to damage it?

Any comments?

Dear Oilguy!

Oil is up again to over US$ 120 on Thursday, 7th August.

Any which way, we are still in the northern summer. As the northern winter approaches, the demand will rise?

awaiting....

K