Updates
Later, 8:45 a.m.: The EIA suggests the price of oil to stay "high," despite plenty of supply.
Tension between Iran and the West is likely to keep oil prices high despite a dramatic improvement in world supply and a big build in stocks, the International Energy Agency (IEA) said on Friday.This is an important data point -- Saudi's ability to pump that much, something I had not expected.
The agency said global oil supply rose 600,000 barrels per day (bpd) to 91 million bpd in April and was now 3.9 million bpd over year ago levels, with 90 percent of the increase coming from OPEC.
Saudi Arabia has said it pumped 10.1 million bpd last month, its highest for more than 30 years, in a bid to meet growing demand and curb oil prices, which hit a three-and-a-half-year high in March.
Original Post
Canadian oil sands: two or three years ago, I often heard producers there needed $60 oil to make money. Indeed, sometime in the last six months, one Canadian oil sands producer temporarily shut down when price of oil went below $100. I forget specifics. And the $100-figure could be off. But trust me -- I do recall a Canadian oil sands producer temporarily shutting down production. [Yes, here it is, back in February, 2012, when WTI was about $95. And a better source here. ]
Now from Russia:
Another problem bred by Mr Putin's rule is a deteriorating economy. Crude oil and gas account for 75% of Russia's exports. In order for him to win the presidency, Mr Putin's government authorized $161 billion in additional spending through 2018, increasing pensions and freezing gas prices. As a result, the government needs an oil price of $150 a barrel over the next few years to break even, while a sharp fall in price (for example to $80 a barrel) could lead to an immediate crisis. -- opinion, David Satter, WSJ, p. A13.I'm pretty sure you can find the op-ed on-line.
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