Amvet

U.S. Oil Imports at Risk

You miss a couple of important points. (1)When we supported the military coup against Chavez and painted it as democratic when we thought that it was successful, we shot ourselves in the foot. (2) We are still punishing the Cuban people for revolting against US control. Most Latinos find this brutal bullying of the small by the big loud mouth.

We continue to be popular with the rich far-right thugs in Latin America, but among the majority our past behavior is coming home to haunt us.

Regarding oil prices, there is evidence that global crude production peaked in 2005. As that seeps into the media, the oil futures funds will push the price higher.

Pressing the Saudis to increase production is dumb. During my 5 years in Saudi Arabia, the complaint that I heard most was "Saudi Arabia overproduces our oil and sells it cheap to help the Americans stay rich and the American Government keeps the family in power".

Depressed Oil Prices Approaching Good Point for Speculation

Current price swings in the oil price have nothing to do with supply and demand.

Oil prices are determined by futures contracts and the majority of futures contracts are bought and sold by people and funds who never take delivery of any oil. One US fund recently sold Feb futures for 80 million bbls. Such massive uses of futures jerks the price around. It is indeed a case of the tail wagging the dog.

This dumb system is destroying segments of the oil and gas industry. Small producers with debt are dieing.

Oil: What Goes Down Must Go Up?

US Government data says that demand fell 50K bpd in 2008 and predicts an additional fall of 450K bpd in 2009. With a base of 85 million bpd, this decrease is trivial. With a decline rate on producing field production of 5% per year, over 4 million bpd of new production is needed to stay even.

Don´t forget that oil prices are set by speculators and not by oil users, which is a totally stupid system (unless you are a speculator!!).

The 'Peak Oil' Myth: New Oil Is Plentiful

Peak oil is about oil production, not about estimated oil in stone.

Current production is around 85 million bbls per day. Low end of estimated yearly production decrease per field: 5%. This means that about 4 million bbls per day of new production is needed each year. That means 40 increases of 100,000 bbls per day each.