echang

As Global Demand Rises, Oil Production Remains Flat

typo-- saudi arabia produces 9.7 mbd, or will if the 200k increase goes into effect this year.

i have yet to read anything or see anything about the increase or decrease in chinese/or indian gas consumption (i hope to have a better idea by the end of the summer), but i do believe the high crude prices have finally begun to destroy demand in the United States. Perhaps its the economic problems but people are beginning to cringe at the mention of high gas prices. I think four a gallon is the tipping point for the American consumer, especially if 9/10 of them think we are in a recession. Gas consumption dropped 1.8% last month, and I heard it fell 3% this month (have not come across this figure in writing). Chinese, Indian and other growing economies may very well offset declining gas consumption here. But there is the chance that their roaring economies slow down. Perhaps its the Chinese economy that crashes after the Olympics and not the stock market; crash might be too strong of a word.

When Crude Drops, AMR Will Fly

well sliman could be partially right...

chinese oil refiners have always tried to purchase as little oil as they could because they sell gas at a loss. if the government increases prices, it might make sense for them to buy more crude oil because quite honestly, chinese consumers weren't getting enough gas at the old prices. oil shortages and lines at gas stations were quite common. Don't know if this still holds true at current prices, nytimes article seems to think it still does. Regardless, many economies seem to be slowing down. Many traditional gas users seem to be slowing down. The bearish story is still unfolding. Only time will tell if its correct

When Crude Drops, AMR Will Fly

absolutely agree with you Gilluly. Plus the very fact that airlines are beginning to cut capacity and flights will reduce gas consumption. The aggregate global airline industry uses approximately 5 million barrels a day. And to Sliman, can China grow forever. They are already beginning measures to slow down their economy, raising interest rates and increasing bank reserve ratios. Their stock market has already crashed, is their economy going to follow with a slowdown? Oil very well might keep going up from this point, but its bound to pullback because the supply/demand equation that existed is starting to disappear.