Peaking Oil Price
Posted by Oilism.com on November 3rd, 2007 at 03:58pm
| On the oil market concerns rose these week because of the unexpected drop in oil supplies and reserves while the US is getting ready for winter.On the future crude oil market the price of a barrel US crude oil (of 159 liters) headed towards the record of 96.24 dollar, but and the end of a week trading the price sledded back to under the 96 dollars a barrel.The price of a barrel North Sea Brent Oil reached a peak of 91.71 dollar. |
In the United States the US weekly oil estimates on supply have unexpectedly decreased. This report came out on Wednesday which the American ministry of energy released. The weekly crude oil supplies, 5.288 million barrels, increased with 316.577 million barrels while analysts assumed an increase with 963,000 barrels.
The petrol supply is set to 1.931 million barrels up with193.937 million barrels. Analysts had expected here an increase with 475,000 barrels. The supplies on fuel and diesel decreased with 1.847 million barrels up to 134.471 million. Analysts expected here an increase with 250,000 barrels. So overall a negative sentiment which will not be over yet I fear.
Record again!
The price of a barrel crude oil breaks record after record these last weeks. On the future market in New York the oil hovered to 96 dollars 24 a barrel. That is the highest level ever in history. Finally a price of 100 dollars a barrel comes in sight and many investors will be very pleased, a couple of months we started this race from 53 dollar a barrel. Time flies when having fun 
Dollar drop vs Oil peak
An important reason for the enormous increase on crude oil is the fact that the US dollar drops day after day. Because oil is settled up in dollars non US countries like Europe can buy a lot cheaper oil nowadays. Maybe it wasn’t a bad idea after all of the oil producing countries (OPEC) to value oil based on a currency like the Euro. This idea came up last summer during the oil price dip of 2007. Now the OPEC gets in fact less money for the same barrel, thank you weak dollar, thank your Mr. Bush
According to Shell the crude oil price is forced up by speculations. The record price for a barrel of the previous weeks is partly increased on speculation and political tensions and not by a poor supply.
Political bonus
These words where said by the CFO of Shell, Peter Voser, in an explanation on the third quarter figures of his company. According to him the prices seem be floated by speculation. He added to that there is a political bonus presented in the current oil price. The price for a barrel Brent crude oil (North Sea oil) reached Thursday a record of 86.28 dollar, peaked by the tensions between Turkey and Kurdish militants.
OPEC covers Shell’s back
Shell doesn’t stands on its own regarding its opinion on the recent peaking of the oil price. Also the OPEC stated that a large part of the increase of the crude oil price in the previous months has been caused by market speculation. According to the OPEC there is no lack on the supply side and the market is very well foreseen. According to the OPEC beside speculation, problems with refining, continuing geopolitical problems in the Middle East and fluctuations of the American US dollar plays a big role. But also Mexico is a source of care for the price of crude oil. In Mexico 20% of the production have been cut because there is a storm heading. Furthermore the incurring tensions in the Middle East are doing no good to the price of black gold. The United States will impose sanctions against Iran and Turkish troops have arrived at the border of Iraq for a possible attack on Kurdish militants. The OPEC forecasts higher prices if the tensions will keep on front the upcoming weeks.
Under Middle East+ Oil+ Oil company+ peak oil
2 Comments for Peaking Oil Price
1. Shell International | May 13th, 2008 at 8:58 am
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