AL Berta

The Realities of Natural Gas

Bravo Georealist!

Oil Demand Does Not Have to Cause Higher Prices

World oil production is approximately 85 million barrels per day. This is the maximum that can be produced currently. The Saudis don't control the price. They have repeatedly tried to "talk the price down" by stating they will increase production. They are whistling in the dark. They and everyone else, are producing every drop they can and still can't keep up with rising demand. Demand is rising 4% annually while production is declining 4% annually. Do the math. Unless demand slows (it won't) or production increases due to massive new discoveries (it won't) then the price of oil will continue higher.

Oil Demand Does Not Have to Cause Higher Prices

As you said, World-wide demand did not decrease from 1946 to 1998. However, the ability of the industry to amply meet the rising demand has now been exhausted and this is where the wheels fall off of your argument. Current maximum industry production of +/- 85 mmbbls/day is scarcely keeping pace with current demand. In addition, demand is now growing faster than production is increasing. So the answer to your question in today's current supply/demand imbalance is; "Yes, higher demand equates to higher prices." The demand side is only half of the equation. With stable production levels meeting increasing demand levels, prices will indeed continue to rise.

The Long Case for Talisman Energy

Excellent article. Well written and in hind-sight, most accurate. Possibly a bit too near-sighted based on the $17.50 puts. TLM will do well in 08 for those buying at $16 - $18.

Get Out of Commodities - Barron's

Commodities pricing is a simple reflection of the value (or lack there of) of the US$. So long as the USD continues it's fall, the price of commodities will continue in the other direction. If you think the USD is going to turn the corner some time soon, then by all means, go short the commodities. I hope you'll also make some investments in real estate. I have for some ocean-front property for sale in Montana.

Talisman Energy: Stock is Cheap and Analysts are Skittish

Good call stockdoc. I re-bought TLM below $17 and fully believe 08 will be a great year for holding and trading TLM. The stock has been a great trader if nothing else the past year or more. A reverse H & S formation has completed and the run past $18 indicates better days immediately ahead. Not to mention the fantastic volume of late! By now or cry later.