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NEWS: Crude Oil Prices Hit $61 Per Barrel

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posted on Jun, 21 2005 @ 01:35 PM
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Oil prices yesterday jumped to an all-time high of $61 per barrel. Even though OPEC raised the output from 7.5 million to 28.5 million barrels per day. More Oil is produced, yet prices keep skyrocketing. $61 per barrel is an all time high as well.

 



www.infowars.com
DESPITE the resolve of Organisation of Petroleum Exporting Countries (OPEC) to raise its official output ceiling from 7.5 million barrels per day to 28.5 million, crude oil prices yesterday jumped to an all-time high of $61 per barrel.

OPEC, which has been under diplomatic pressure from world's industrialised nations to lower prices with more supply, had at an extraordinary meeting in Vienna, Austria, increased its combined crude oil output in an effort to arrest galloping prices in the export market.

But the gesture was immediately dismissed by market analysts as merely symbolic as OPEC members had been producing far in excess of the new calling unofficially.


Please visit the link provided for the complete story.


I find it very odd that oil prices are skyrocketing, yet they are producing more and more oil. The "peak oil" doesn't seem to fit in here, as if there was actually an oil crises why would OPEC raise the production by over 20 million barrels a day?

The oil companies wish to make more money? Or are the prices justified? IMO prices should drop if output rises. But this is not the case.

Time to buy an electric hybrid car, as the SUV's just got less appealing.

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posted on Jun, 21 2005 @ 01:41 PM
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I agree that it makes no sense. Especially when you throw in the fact that the oil refineries in the US are already operating at or near max capacity so the addition of any new oil would do nothing to bring the cost down to the US citizen.



posted on Jun, 21 2005 @ 01:52 PM
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Why not move to a hemp based economy? You can use its' oils for 90% of what you use peterol for and it is renewable, and the midwest of both Canada and the States could produce it so that it solves both problems of Farmers needing something productive to grow, and it would keep us away from being the middle east's lap dog.

Hemp is an amazing crop if some in the US government could get with the times and get over their reffer madness.

Think about it. 90% of what is being ransomed off for American lives, and you already have it sitting right there....



posted on Jun, 21 2005 @ 02:41 PM
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OPEC's rules are meaningless. If they only allow such-and-such amount of oil to be produced (really "exported," not "produced") by its members, that doesn't actually affect the output of its members. Increasing the allowed output doesn't increase the amount of output - the increase, actually, is long overdue, as I understand it, because the members have been exporting more than even the adjusted number for some time.

Looking at the news in this light, you may have a better idea of where "peak oil" fits in here.

EDIT:

from 2001
“In three to five years, I would say that OPEC is meaningless because everyone will be running at capacity,” said Adkins.

- Marshall Adkins, head of energy research at Raymond James & Associates.

EDIT 2:

from a random news web page:
`Meaningless' Quotas

``The quotas have become meaningless,'' said Julian Lee, an analyst at the Centre for Global Energy Studies, a London-based consulting company. ``In addition to Venezuela and Iran, Indonesia is well below its quota, perhaps half a million barrels per day or more. As the quotas increase more and more others are going to find that they simply don't have capacity to meet their quota levels and it's really only Saudi Arabia that has the spare.''


Zip

[edit on 6/21/2005 by Zipdot]



posted on Jun, 21 2005 @ 02:50 PM
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I'll add another post here because I edited the above post so much.
The Saudis will always say that they have more oil; that they can increase output whenever they want; that there is more than enough oil in the world to last for millenia to come, etc., etc.

That's all fine for the rich Saudi oil lords, but what about extra-Saudi investors -- what do they say? Well, respected energy analysts and petrochemical company heads agree that Saudi Arabia has much less oil than they claim. Investors - people with something to lose pay good money for good analyses of Saudi oil, and the conclusions are bleak.

Zip



posted on Jun, 21 2005 @ 03:43 PM
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You beat me to it Zipdot......


I want to add that there has to be a fallacy level to the Saudi assertion. The economic machine of the world is driven day in and day out by the 'good' or 'bad' feeling of the investor, so a token comment on the positive outlook of a resource that the world has ended up using as a crutch is to be expected..........



posted on Jun, 21 2005 @ 10:42 PM
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Why is infowars the only one saying $61 while all of the others have prices below $60?

The NYMEX chart shows it never went above $60


www.wtrg.com...



posted on Jun, 21 2005 @ 10:57 PM
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prices get higher because the dynamics of the market have changed. it's not just the US greedily asking for more oil now, China and India's energy booms are massive and a lot of that extra oil is going there. More people are fighting over more oil now than ever.



posted on Jun, 21 2005 @ 11:37 PM
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I find it very odd that oil prices are skyrocketing, yet they are producing more and more oil. The "peak oil" doesn't seem to fit in here, as if there was actually an oil crises why would OPEC raise the production by over 20 million barrels a day?

The oil companies wish to make more money? Or are the prices justified? IMO prices should drop if output rises. But this is not the case.

Time to buy an electric hybrid car, as the SUV's just got less appealing.


Actually peak oil does fit in with the prices of oil these days. The problem is that it is getting more and more expensive to get oil, because it is getting harder and harder to find pockets of oil. Oil companies have to use the services of other companies which have engineers and other specialists and are using the latest and most advanced technology to find new places where to get oil from, or to maximize the efficiency and percentage of oil being produced from old oil fields.

In the old days it was possible to shoot at the ground and oil would gush out like in the movie Beverly Hillbillies. Nowadays you won't find oil on the surface anymore, and more often than not oil is found in porous layers of rock, much like a sponge holds water, and it has to be extracted from that rock. It takes a lot of money to do this, this is the reason why oil is getting more and more expensive. There is still oil to be found, but it is getting harder and more expensive to not only find it, but to get it out.



posted on Jun, 22 2005 @ 12:52 AM
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Infowars is not alone. Searching news.google.com, AllAfrica lists a price of 61 dollars, while many pages specify that 60 dollars was "just missed," it is still a fact that $59.70 is an all-time high.

People in this thread are acting like OPEC is actually outputting more because of these demands. As I stated above, and as is mentioned in the article, the adjusted output allowance does not actually affect the output. Most members of OPEC are pumping at capacity - and many countries output has declined, meaning that they have peaked.

Saudi Arabia is the only country estimated to actually be able to increase output, but so far they have not demonstrated that they have the amount of sweet crude that they have been telling us about.

Here is a chart of non-OPEC countries that have already peaked:



Each of those countries has indisputedly peaked.

Zip



posted on Jun, 22 2005 @ 02:07 AM
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kenshiro makes an excellent point.

increase production all you want. if we can't handle the sudden quadruple supply we have accomplished nothing.

i firmly believe a good chunk of this price outrage is due to overgreedy companies with powerful lobbying firms that have politicians in their pockets.

if every consumer in the US (not including emergency services) would turn around and agree that if prices do not get slashed they will boycott all gas stations for 24 hours, the tune would change. realize how much cash flows at the nation's gas pumps in one day. that's the buying power of the american public that never gets used. "stop gouging or we stop buying". it would be interesting to see how that would work out.



posted on Jun, 22 2005 @ 04:24 AM
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Originally posted by Djarums
..............
i firmly believe a good chunk of this price outrage is due to overgreedy companies with powerful lobbying firms that have politicians in their pockets.
..............


I don't think so, there is still a lot of oil out there, but it is harder and more expensive to not only find it, but to extract it.

Oil drilling nowadays is not as easy as it used to be, and since oil is not getting easier to find, major oil companies have to rely on other companies which specialize in using their most advanced technologies to improve oil drilling from old oil fields, or on how to get oil from the new fields.

To stay on top of the market, those major companies that provide services to the oil and gas industry, have propietary technology which they keep improving but which gets more and more expensive.

Oil drilling is very expensive, after the oil is taken from an area that area has to be filled with different sorts of liquids, and other compounds which have different density and viscosity depending on the depth of the hole. The maximum amount of pressure that can be encountered in the Earth crust is about 20,000-25,000 psi, which is the reason why the places being drilled have to be filled up.

Some of the liquids and compounds used have the same viscosity and density as oil, and as you fill it up you use other liquids/compounds which will have different density. After that is done the area would be as stable as it was before it was drilled.

These days seismic readings are still used to find areas where is possible to find oil. Note that I say possible, because noone will tell you they are 100% sure there is oil in an area.

Seismic data can be used to find where there is water, gas, different layers of rock, and oil. All of these give different readings in darker or lighter shades. Depending on the shades that the seismic reading gives you, you will know, with a percentage of certainty, what you are going to find in that area. Whether it is gas, water, different layers of rock, or oil.

But technology has changed so much that now it is possible to have a 3-d mapping of an area you are exploring, and have that 3-d map inside a room. It would be laid out in such a manner that you can walk inside this room and you will see the area you are exploring as if you were watching a 3-d movie all around you, except that you can interact with this map. You can find this information and more online I am sure, more than that i will not get into. But this should give you an idea on why the oil prices are so much expensive these days.

Anyways, of course the more advanced and rare the technology used, and the manner in which those companies extract oil is, the more money these companies have to charge, which in itself also reflects how much oil costs in the market, hence the term peak oil. Because the easy and most affordable oil has already been tapped into and extracted.

Of course, there are other variables which affects the price of oil in the market, such as conflicts in areas where a percentage of oil is extracted for the world market, etc, etc.



posted on Jun, 22 2005 @ 07:19 AM
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Originally posted by Djarums
kenshiro makes an excellent point.

increase production all you want. if we can't handle the sudden quadruple supply we have accomplished nothing.


This is really not valid, because, as I have stated several times, the actual output was raised long ago. It is only now being recognized by the out-of-sync OPEC that, "okay, it's time we symbolically raised allowable output since output is already so much higher than even our new number."

Zip



posted on Jun, 22 2005 @ 07:38 AM
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I dont know if it was posted already here on ATS but i heard that China plans to set up a strategic oil depot for the future...this means they will buy millions of barrells which could have an influence on the current oil prices.



posted on Jun, 22 2005 @ 07:52 AM
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Prices have been skyrocketing since 1999. That OPEC decides to raise its theoretical production limits means very little. OPEC's efforts might mitigate the skyrocketing prices but making them fall would require production levels that they cannot provide.

People seem to think that the levels OPEC is saying that they will produce should provide a price decline. Based on what? Increasing production but still not meeting the levels the World now needs will not see prices drop, they will still increase but not as fast.

India and China emerging as the Worlds energy guzzling powerhouses is to blame for the price rises inspite of increased production.

Which brings us to why OPEC isnt raising the theoretical production levels to those needed to see prices fall or even stabilize? Is it that they dont want to see prices fall or that they are physically incapable of satiating the Worlds skyrocketing demand for this mother of all comodities? I would tend to think its both.

[edit on 22/6/05 by subz]



posted on Jun, 22 2005 @ 09:44 AM
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In an interview with Kurt Wulff he was asked about Saudi Arabian oil reserves:



Saudi Arabia more or less managed to market its oil around the $25-a-barrel level for as long as it could. The big event of 2004 is that the oil market called Saudi Arabia's bluff. They couldn't deliver the spare capacity they said they had. It turns out they have spare capacity, but it is in heavy oil, not light oil, which is easy to refine and doesn't have much sulphur in it. It's also known as "light sweet" crude, and it produces more gasoline and more heating oil. So 2004 was the year in which the world production of light oil peaked. There are no big fields of light oil producing now that can produce more. Saudi Arabia has heavy oil to sell, but they have to discount it much more. If Saudi Arabia could have produced more light oil, they would have.
Article

Since the oil industry cannot produce enough sweet crude the price of sweet crude it going up even if the actual volume of types of oil are going up. Heavy crude has sulpher in it and most refineries are not set up to process the heavy crude oil. so total numbers do not tell the whole story.

Oil speculation is also driving up the cost of oil.




Feb. 18 (Bloomberg) -- Shell Canada Ltd. Chief Executive Officer Clive Mather says oil from his Athabasca project, where tar sands are boiled to produce crude, can cost twice as much as drilling in the North Sea. And it's worth every cent, he says.

``If we had access to unlimited conventional oil, I guess the interest in Athabasca would diminish quite quickly, but that isn't the case,'' Mather said in a Feb. 3 interview in London. ``This is high-cost oil, there's no question about that. At current prices, it's still very good business.''

A 15-year decline in oil reserves is spurring companies such as Royal Dutch/Shell Group, Exxon Mobil Corp. and ChevronTexaco Corp. to spend $76 billion in the next decade to boost supplies of oil from tar sands and diesel fuel from Qatari natural gas. Oil executives say they have no choice but to try alternatives to drilling because there is not much more crude to be found in their current fields.

``We're damn close'' to the peak in conventional oil production, Boone Pickens, who oversees more than $1 billion in energy-related investments at his Dallas hedge fund firm, said in an interview in New York Feb. 16. ``I think we're there.'' Suncor Energy Inc., the world's second-biggest oil-sands miner, is his largest holding.
Article



posted on Jun, 22 2005 @ 02:48 PM
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This might explain why oil prices ar jumping now, despite increased production.

www.abovetopsecret.com...



posted on Jun, 22 2005 @ 03:21 PM
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Originally posted by subz
.....................
India and China emerging as the Worlds energy guzzling powerhouses is to blame for the price rises inspite of increased production.
.....................
[edit on 22/6/05 by subz]


Yep, in that you are right, that is also part of the reason why oil prices have risen so much, although you really can't blame them for this.



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