OPEC cuts may crimp economy

[Whoa_Nelly]

OPEC cuts may crimp economy

Output limits seen offsetting expected rise in Iraqi crude

By John W. Schoen
MSNBC



Sept. 24 — Even though the world’s oil tank has been running low this year, OPEC ministers meeting in Vienna Wednesday voted to make a surprise cut in production quotas, amid signs that crude oil shortages are easing. The cartel’s fear, apparently, is that a steady increase in production from Iraq could force world oil prices lower. But some analysts believe that, as long as attacks continue on U.S.-led forces and the Iraqi oil industry, tight crude oil supplies will continue to put the squeeze on energy consumers.

WITH THE LOSS of Iraq’s oil supplies to war and the lingering effects of labor strikes on Venezuela’s oil industry, world oil inventories have been running very low this year. But though supplies still remain tight, the shortfall has begun easing in recent months. In February, petroleum inventories were some 200 million barrels below normal levels, but that shortfall had cut to about 58 million barrels as of August, according to Merrill Lynch.

<snip>
Now, with the rebuilding of Iraq’s oil industry underway and the expectation that more of that country’s oil will soon hit world markets, the Organization of Petroleum Exporting Countries decided to tighten the taps a bit to slow the supply build-up and keep prices from falling further.


<snip>
News of OPEC’s production cuts — of about 900,000 barrels a day — bumped oil prices back up by $1.15 Wednesday to $28.28 a barrel.

more...
http://www.msnbc.com/news/971120.asp?0sl=-23&cp1=1

Read on the MSNBC ticker that this may start November 1.

[Nottingham]

1. Its a good thing we have made friends with the Russians

:bounce:

[drscm]

2. Not to worry....

When Clinton faced an oil shortage, didn't Bush say during the campaign that he would talk to his friends over there ?

[Don_G]

3. Dimbo Had Friends?

Oh yeah, Barney. I hear he's "screwed the pooch" a lot lately.

[Gloria]

4. ENERGY SUMMIT FUELS U.S. PROMISES

From the current World Media Watch.....

4//The Moscow Times Tuesday, Sep. 23, 2003. Page 1

http://www.themoscowtimes.com/stories/2003/09/23/001.html



ENERGY SUMMIT FUELS U.S. PROMISES

By Valeria Korchagina
Staff Writer



ST. PETERSBURG -- If last year's buzzword was "dialogue," this year's was surely "partnership."

It doesn't sound like much of a difference, but unlike the get-to-know-you session in Texas last year, the second annual U.S.-Russia energy summit in St. Petersburg has more of an imperial air to it, more of a feeling of urgency.



SNIP

"You cannot help realize what a powerful thing this partnership between these two countries can be," Evans said.



SNIP


A year ago, oil-rich Iraq was still pumping considerable amounts of crude, America had yet to articulate its strategy to combat its chronic shortage of liquefied natural gas, and the British hadn't trumped its global rivals via BP's record $7.7 billion play for half of TNK. And with the Saudis, Germans, Italians, French, Japanese and Chinese increasingly anxious to get a slice of the vast Russian hydrocarbon pie, Washington needs to act fast if it is to secure future energy supplies from its former Cold War foe.



"You will see more and more companies coming to this country," Evans said, naming the familiar list of oil majors with a major interest in Russia: ExxonMobil, ChevronTexaco, ConocoPhillips and Marathon.



SNIP


Leading up to the summit, the oil world was abuzz with reports that either ChevronTexaco or ExxonMobil would agree to pay up to $11 billion for 25 percent of Yukos, Russia's largest oil producer. All three of the companies, however, would neither deny nor confirm the reports, adding to speculation that something big was in the works.


MORE

[bluestateguy]

5. Well!

If the DUMBOCRATS would just turn over the ANWR to the oil companies and let them drill away, I'm sure gas prices might drop by two or three cents a gallon in 4 or 5 years, or 10.

[cliss]

6. The OPEC countries are just trying

to stabilize prices for the time being. After all, the US just invaded the world's #2 oil supply. They are probably trying to figure out what will happen next.

Will the Iraqi pipeline be blown up again? (count on it). Will it be fixed again? (without a doubt) at a cost of $millions.

So they're probably taking a wait and see attitude. The only thing that worries me is our economy takes a hit every time oil prices jump. Our entire economy is built on someone else's oil, including the decision on how to price it. Nothing like feeling secure, right?

Stan Goff says that our economy is so dependent on oil prices that when oil hits $50.00 a barrel, our economy, including the stock market, comes to a grinding halt.

[bemildred]

7. You have to wonder if they have additional motives.

Dislike of Shrub, say, or a deal made to keep prices up
so all that Russian oil is worth pumping out.