WikiLeaks: Saudis often warned U.S. about oil speculators in 2008

Right, they can’t ‘put crude out on the market’ but they can lower the price, a point he cleverly avoids. WikiLeaks: Saudis often warned U.S. about oil speculators By Kevin G. Hall Saudi Oil Minister Ali al Naimi even told U.S. Ambassador Ford Fraker that the kingdom would have difficulty finding customers for the additional […]

Saudi oil production, Donald Trump, and President Obama

The Saudis operate by posting prices for their refiners and then filling all orders at their posted prices. It looks like the spike in demand for Saudi crude due to Libya has pretty much passed, and Libya is not back to full production. So look for Saudi production to fall further when Libya comes back […]

Saudi’s oil production down 900k bpd

Right, this is the second time they’ve said this. It could all simply be ‘cover’ for lowering prices. Lots of reasons why they might lower price: Get it way down and ‘intimidate’ investors in alternatives. Try to spur demand. Try to support the world economy and their support their equity holdings. Members of the royal […]

in case there is any doubt about how the price of oil is set

OPEC (and mainly the Saudis) is the only entity with excess capacity, so it is necessarily price setter. Specifically, they post prices to their refiners and who order all they want at that price. They don’t sell in the spot markets. See highlighted text below. ‘Balancing supply and demand’ is price setting. The higher prices, […]

OPEC April Crude Output Up 25,000 Bbl/Day to 29.19 Mln

No sign the price hikes are coming from demand pressures. It’s just the saudis hiking price, thinly masked by the news headlines and passive commodity buyers they use for ‘cover’ so no fingers get pointed in their direction — Original Sender: NLRT ALERT, BLOOMBERG/ 731 LEXIN — —– Original Message —– From: NLRT ALERT (BLOOMBERG/ […]

Natural gas from shale

[Skip to the end] Good story. The key is to replace crude oil which is now largely used for ground transportation. Pluggable hybrid cars can do the trick if we can get through the next 10 years while they begin to take over. And natural gas can begin to replace coal for electric power generation […]

DOEs: Industrial Demand Rises Above 2008

[Skip to the end] With any kind of meaningful recovery the saudis will be able to increase price substantially without fear of demand falling off. Right now they are just setting the hook. Letting the world economies stabilize and financial markets recover before making their next move, while no conservation efforts of consequence are being […]