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Top Three Reasons Why Oil Prices Are Poised to Rally
Experts roundly agree that the recession is only a short-term blip in the long-term escalation of oil prices.
And this time, there are 1.05 trillion reasons why oil is going to climb well past its peak last year.
Table of Contents:
- Oil Production: Why OPEC’s Keeping a Lid on Production
- Oil Prices: Why Crude Thrives on the Diving Dollar
- Oil Outlook: The Coming Oil Price Shock
- Investing in Oil: The Best Companies, Stocks and ETFs
Oil has staged an impressive rally since dropping below $35 a barrel in mid-February.
And while there remains a risk that prices will retreat further due to sluggish demand,…
Is Brazil the New Oil King?
With Exxon Mobil Corp.’s (XOM) new oil discovery off the coast of Brazil – the latest in a series of such offshore finds and potentially the largest Western Hemisphere discovery in three decades – the South American nation has taken another giant step in its quest to become a global energy superpower.
Exxon’s Azulao-1 well tapped a reservoir that reportedly contains as much as 8 billion barrels of recoverable oil, says Luiz Lemos, a partner at TozziniFreire Advogados, a Brazilian law firm that represents foreign energy companies.
“This is very huge,” Lemos told Bloomberg News.
So is the potential benefit for Brazil. If…
18Mar2009 | Money Morning | 0 comments | ContinuedLow Oil Prices Curing Low Oil Prices
The third observation is that decline rates could curtail supply quickly. Past oil-price collapses have been associated with a sharp increase in the decline rates observed in mature basins. Using past production curves as a proxy, Deutsche Bank estimates that as much as 1.5 million b/d of supply could be lost to accelerated decline over the next 2 years within the US onshore, Alaska, Canada, UK, Norway, and Russia.
Finally, the analysts see that new supply projects are being postponed. Within the growth regions, the rise in costs and taxes in recent years suggests that the average oil…
3Mar2009 | The Real Deal | 0 comments | ContinuedOPEC Production Cut Fails to Inspire Oil Market; Oil Drops to Four-Year Low
Oil prices fell again yesterday (Wednesday) – dropping below $40 for the first time in four years – as weak demand and growing inventories overshadowed a record cut in production by the Organization of Petroleum Exporting Countries (OPEC).
Light, sweet crude for January delivery fell $3.54 to settle at $40.06 a barrel on the New York Mercantile Exchange – the lowest level since 2004. Oil futures actually traded as low as $39.88 during the day yesterday. The slide came in spite of an announcement by OPEC that the cartel would cut its production quotas by 2.2 million barrels per day (bpd),…
18Dec2008 | Money Morning | 0 comments | ContinuedOPEC Left to Deliberate as Oil Prices Plummet
Crude oil prices have plunged two- thirds from its record high during the summer, and the likelihood they’ll fall further has caused panic among oil-producing nations and inspired the Organization of Petroleum Exporting Countries (OPEC) to call another meeting this week to discuss possible production cuts.
After blitzing to a record-high $147 a barrel in July, oil last week receded below $50 a barrel, causing a stir among energy companies and oil-producing nations that rely heavily on exports for income. Some analysts predict that oil could fall to $30 or $40 a barrel by early 2009, as so-called “demand destruction” sets…
24Nov2008 | Money Morning | 0 comments | ContinuedOPEC Production Cut Up in the Air as Members to Clash Over Oil Prices
In the face of the worst worldwide financial crisis since the Great Depression, the Organization of Petroleum Exporting Countries (OPEC) is expected to cut crude-oil output and raise prices at an emergency meeting in Vienna tomorrow (Friday). But even with crude oil prices down more than 50% from their July record highs, friction between cartel members has analysts wondering just how big the prospective cut will actually be.
Oil prices continued their downward slide yesterday (Wednesday), dropping $5.22 a barrel, or 7.2%, to $66.96. Prices are down about 55% from the record high of $147.27 a barrel reached July 11. Crude’s…
23Oct2008 | Money Morning | Comments Off | ContinuedFed Up With Financials? Let’s Go Drill For Oil Instead…
You know what?
I’m done with the financial sector for now. For the past 48 hours or so, everyone (except perhaps folks in parts of deepest, darkest Peru) seems to have pontificated ad nauseum about the woes within the sector.
It’s a lazy television producer’s dream. You can’t turn on a news or business channel without hearing the “Latest On Lehman,†as the tube revels in yet another panic-inducing story that can run endlessly.
Sure, people want to know the details – after all, this is one of the biggest financial meltdowns in history – but just how much is enough? And how…
17Sep2008 | Smart Profits Report | Comments Off | ContinuedSaudi Arabia Hesitant to Join OPEC in Production Cut
Despite earlier pledges to hold oil output steady, the Organization of Petroleum Exporting Countries (OPEC) yesterday (Wednesday) announced that it would cut production by 520,000 barrels per day in an effort to “strictly comply” with the production quotas set last September. However, Saudi Arabia, the cartel’s largest and most influential member has indicated otherwise.
The cartel, which controls 40% of the world’s oil exports, pointed to such factors as tumbling demand, greater supply, the dollar’s recent rally and an easing of political tensions – all of which have contributed to a 30% drop in oil prices over the past nine weeks.
“All…
11Sep2008 | Money Morning | Comments Off | ContinuedFour Ways to Fight the “Oil-Flation Epidemicâ€
Want to know what the price of a barrel of oil will be in eight years?
Exactly $119.50 a barrel.
There’s no shortage of pundits predicting where oil prices are heading. And every day seems to bring new reasons to change the forecast – a resurgent dollar, Americans curtailing their driving habits, oil supply reports… The list goes on.
But the guys who really know the future of oil prices are those sitting right in the driver’s seat – oil producers.
Every day, they make bets about the direction of petro prices on the futures market. And right now, they’re telling you – in…
3Sep2008 | Money Morning | Comments Off | ContinuedWHAT MAKES THE WHEELS ON THE BUS GO ‘ROUND AND ‘ROUND?
Imagine a municipal bus that’s powered by an electric motor, crawling along the crowded streets of Beijing. What does this bus have in common with the Ronald Reagan Presidential Library, in Simi Valley, California?
Or imagine offshore oil production platforms in the Gulf of Alaska or the North Sea. What do these offshore platforms have in common with a luxury ski resort near St. Petersburg, Russia?
When you first think of it, there’s not much commonality between a city bus in China and a large presidential library in the U.S. And how do you begin to compare an austere and remote offshore oil…
31Jul2008 | Daily Reckoning | Comments Off | Continued
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