Saudi Arabia wants oil price at $75 a barrel

[Novicej]

November 30, 2008 -- Updated 0146 GMT (0946 HKT)

 

http://edition.cnn.com/2008/BUSINESS/11/29...c.ap/index.html

 

Looks like oil price will rise afterall.

 

 

Read:

CAIRO, Egypt (AP) -- Saudi Arabia said Saturday that it hoped to raise oil prices to $75 a barrel, but indicated that no measures would probably be taken until an OPEC meeting next month in Algeria.

OPEC countries will have to cut oil production by 3 million barrels a day to hike price to $75, group says.

 

OPEC countries will have to cut oil production by 3 million barrels a day to hike price to $75, group says.

 

Saudi Oil Minister Ali Naimi said that OPEC will "do what needs to be done" to shore up falling oil prices when the cartel meets next month in Algeria, even as his king told a Kuwaiti newspaper that $75 a barrel was a fair price for oil

 

Naimi did not entirely rule out the chance that the Organization of Petroleum Exporting Countries would slash output at the hastily convened meeting Saturday, but he did say the bloc needed to wait until the meeting in Oran, Algeria on Dec. 17 to assess the impact of two previous rounds of cuts.

 

His comments came after Saudi King Abdullah told the Kuwaiti daily Al-Seyassah that oil should be priced at $75 a barrel, far above its current rate.

 

"We believe the fair price for oil is $75 a barrel," he said, without elaborating on how this would be achieved. Whereas crude stood at about $147 a barrel in mid-July, it now hovers about $90 lower. On Friday, the U.S. benchmark West Texas Intermediate crude for January delivery was trading at about $54 per barrel.

 

The king was echoed by Qatar's Oil Minister Abdullah Bin Hamad al-Attiya, who told the Arab news channel Al-Arabiya just before the opening of the meeting of the Organization of Arab Petroleum Exporting Countries Saturday that prices needed to rise to guarantee investment into the oil sector.

 

"The price between 70 to 80 (dollars a barrel) is the one encouraging in investment and developing new or current oil fields. It falls below 70, the investment would freeze, which will lead to a crisis in supply in the future."

 

The representatives of the OPEC face their third test in as many months to engineer a rebound in prices hammered by plummeting crude demand amid a global economic meltdown.

 

The cartel has already held one emergency meeting -- on Oct. 24 in Vienna -- to try to halt the slide in prices with an announcement of a 1.5 million barrel per day drop.

 

It failed to support prices, and the cartel hastily convened the Cairo gathering on Saturday on the sidelines of the OAPEC meeting.

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Kuwait's oil minister Mohammed al-Aleem said Friday he believes there was "no need" for OPEC to take a decision in Cairo on cutting output. But he warned the market is oversupplied, and didn't rule out the need for OPEC to cut production further.

 

"We believe a decision could be taken ... but I think it will happen in Algeria," he said.

 

Al-Aleem said current prices could undercut investment in future projects and were not good for either producers or consumers.

 

The recent price drop has left price hawks Venezuela and Iran clamoring for further reductions of at least 1 million barrels a day. Both countries need crude of about $90 per barrel to meet current spending needs aimed in part at propping up domestically unpopular regimes.

 

Other OPEC members, such as Nigeria and Ecuador, face budget problems too, making them reluctant to implement more cuts that might shrink revenues further.

 

Unlike many of their fellow members, the Saudis are better positioned to cope with the drop in prices. The International Monetary Fund estimates Riyadh needs crude in the range of about $50 per barrel for 2008 fiscal accounts to break even.

 

Also unclear, after two earlier cuts failed to push prices higher, is what the group can do without prolonging the global economic downturn.

 

OPEC itself, along with the International Energy Agency, has significantly revised down its projections for demand growth in 2009.

 

Meanwhile, global crude inventories are growing, as evidenced by a U.S. government report showing a surprisingly large 7 million barrel build in stocks last week in the world's largest energy consumer.

 

OPEC's last round of cuts would put its total production at about 30.5 million barrels per day, according to the IEA. That is about 500,000 barrels per day higher than the forecast call on OPEC crude in much of 2009.

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Those factors argue against restraint if some in OPEC want crude back up to at least $70.

 

A Nov. 24 research report by the New York-based Oppenheimer & Co. in New York said that for oil to rebound to $65 a barrel, OPEC would need to cut crude production by more than 3 million barrels per day from its September levels -- a move it called highly unlikely.

[Mzrmazda3]

US$ 75 Per Barrel ...

[Xefera]

what they probably failed to mention is that if the prices continued to hover at the current level, their yearly GDP and revenue intake will be affected.

[Galantspeedz]

but when prices were at a high, they did not say want to in crease production to bring down the price to the fair price of $90 leh

[Jacf]

crap excuses by OPEC to raise oil prices , prices high dun increase production, prices low wanna cut production... win-win for them lor.. world will always be held ransom by these oil producing countries till the day oil run out for them! but by then, they will probably have huge reserve enough to buy over some small countries!

[Klinz]

Or can go Green....that's why hopefully R&D in Green fuel will rip results so that these oil cartels will be history...

 

Sometime I can't help wondering why SG government spend so much on Life sciences R&D but a little on Green Fuel... My tot green fuel has better chance of success rather than life sciences...

 

Moreover, our neighbouring countries is flooded with raw material to produce green fuel..if we have the technology to produce biofuel at a much cheaper rate, SG will be a 'oil producing' country liao

 

Dream on.....

[Tjkbeluga]

It all boils down to revenue.... You think gahmen so stupid to cut down their income for the sake of go green? Ultimately, they already have a figure of how much each car owner must pay a month. It's just the matter of renaming the tax.

[Stary]

Political reasons.

 

Look at our technology. If we really want to pursue an alternative to fossil fuel, we could have done that a decade or two ago. Hell, we even send someone to the moon nearly 40 years ago!

 

All government profit from oil. Either they produce it, or they tax it if they don't. Either way, they win. Why kill the golden goose?

 

Hence, support for green alternative has been slow and not very forthcoming. Mostly depend on initiatives from enterprises. Yes, there are many big shows on going green and all that, but when it's time to show the money, there really isn't much out there.

Edited December 2, 2008 by Starry

[Wt_know]

the opec cartels have planned to build some more billion-dollars hotel, supersize mansion, man-made island, and to add some limited edition ferrari and lamboghini by expecting crude oil to settle at least @ USD$90 per barrel. now oil crash to

Edited December 2, 2008 by Wt_know

[Novicej]

Free energy is not new. Many people already "succeeded" a long time ago. But there are always some "accidents" that somehow staled these projects.

 

eg

Tesla developed a way to create sustainable free energy for the entire world. - but there were some missing paper that prevented progress.

 

DeGeus was the inventor of a thin wafer-like material/device that somehow specially aligned the atoms or electron currents ongoing in that material, so that the wafer produced a constant amperage at a small voltage

[Klinz]

That's why I put Dream on lor...

 

What you said is true and it's sad as much as we do not want to feel this...sometime look at the month end bill, we can't help but and the government... well that's life....

[Albeniz]

Now, they say US$75 is a fair price.

 

Are they admitting that the previous price of US$147 is grossly unfair?

If that were the case, did they do anything to lower to US$75 (from US$147) at that point of time?

[Mzrmazda3]

Now, they say US$75 is a fair price.

 

Are they admitting that the previous price of US$147 is grossly unfair? If that were the case, did they do anything to lower to US$75 (from US$147) at that point of time?

 

[Wt_know]

they did, they increased production by 1 million barrels per day

 

they claimed that the high oil price was speculated by "traders" in wall street and has no relation to demand-supply , which i believe them

Edited December 2, 2008 by Wt_know

[Wt_know]

what is fair price ? all the analyst and traders are sucker

 

when oil shoot above USD$100, they cry papa mama that oil will reach USD$200

 

when oil crash below $70, they cry papa mama that world recession will prolong if oil stays low

Edited December 2, 2008 by Wt_know

[Shull]

so now they should say the low price is also due to speculators and not due to demand-supply..

 

so should not cut supply..

[Mzrmazda3]

So 'True' man ...

[Silver_blade]

Political reasons.

 

Look at our technology. If we really want to pursue an alternative to fossil fuel, we could have done that a decade or two ago. Hell, we even send someone to the moon nearly 40 years ago!

 

All government profit from oil. Either they produce it, or they tax it if they don't. Either way, they win. Why kill the golden goose?

 

Hence, support for green alternative has been slow and not very forthcoming. Mostly depend on initiatives from enterprises. Yes, there are many big shows on going green and all that, but when it's time to show the money, there really isn't much out there.

You are right. No one really bother to focus on green-technology....if they had wanted to...they would so decades ago and I'm sure we will be enjoying the fruit now.

 

Of the current technology....I feel GM probably have the most 'ideal' system if the launch the Volt. But they may go bankrupt before it can be launched.