Here's the price of gasoline in 2004 dollars.
Posted on 03/30/2004 12:44:44 PM PST by Dane
Saudis Signal They Will Proceed With Oil-Production Cut
By SIMON ROMERO
Published: March 30, 2004
ARTICLE TOOLS
TIMES NEWS TRACKER
Oil (Petroleum) and Gasoline
Organization of Petroleum Exporting Countries
Vienna (Austria)
VIENNA, March 30 — Saudi Arabia signaled today that it was proceeding with its plans to cut oil production, prompting a gathering of OPEC officials here this week to voice support for higher crude oil prices, which have become a sensitive political issue in the United States.
"Throwing more oil on the market would be destructive for everybody," said Ali al-Naimi, the oil minister for Saudi Arabia, the most pivotal member of the Organization of Petroleum Exporting Countries. Mr. Naimi sought to brush aside criticism that his nation was seeking higher returns from oil exports, claiming a flurry of speculative activity in commodity markets was behind the recent increase in oil prices.
Still, as if on cue from Mr. Naimi's statements, prices for light crude climbed 35 cents to $35.80 in trading today in New York, approaching the 13-year high they reached earlier this month. OPEC is expected to discuss on Wednesday whether it will adhere to a cut of 1 million barrels announced at a meeting last month in Algiers.
OPEC, which produces roughly a third of the world's oil, is believed to be producing about 26 million barrels a day, or well above its official target of 24.5 million barrels. Supported by strong demand in China and the United States, the price for West Texas crude oil averaged $35.25 a barrel in the first quarter, the highest such level in the last 20 years, according to Cambridge Energy Research Associates.
There appears to be strong sentiment within OPEC to keep prices high, with several delegates speaking in support of Saudi Arabia today, including representatives from Algeria, Libya and Venezuela. "I feel we should go with the cut," Fathi bin Shatwan, Libya's oil minister, told reporters. "Maybe there's a bit of oversupply even."
Despite signs that some producers in the Persian Gulf might be hesitant to pursue an output cut, including the United Arab Emirates and Kuwait, OPEC is expected to sway in the direction of Saudi Arabia, which alone has the swing capacity to rapidly increase or decrease production.
The Saudi economy is growing at its fastest pace since the early 1980's, helped by robust oil sales.
Growing concern in Washington over rising oil and gasoline prices seems to be having little effect on OPEC's decisions.
"People in power know that crude supplies have nothing to do with the current gasoline prices in the U.S.," Mr. Naimi, the Saudi oil minister, told reporters during a brisk walk through the streets of Vienna today. "A lot of things will be said in an election year."
There is little doubt that gasoline prices in the United States, which are expected to reach a record this spring, are bringing renewed attention to OPEC's 11 members. At the Senate Armed Services Committee hearing on March 23, which was mostly about nuclear weapons, Edward M. Kennedy, Democrat of Massachusetts, questioned Spencer Abraham, the Energy Secretary, about energy prices.
"No one in that state can understand why the president of the United States isn't jawboning OPEC to increase production to make a difference at the very time that we're losing men and women over there in Iraq," Mr. Kennedy said. "Maybe there's a rationale for that, but it's an intolerable position."
"We also are concerned about prices," Mr. Abraham replied. "I have expressed this on a number of occasions recently. We've also made it clear that we're not going to beg for oil." But Andrew Card, the president's chief of staff, appearing on MSNBC two days later, said that the United States was consulting with its "allies" in Opec and asking for more production.
Few analysts believe, however, that OPEC will actually implement production cuts even if it announces such measures. For instance, it would be almost impossible for OPEC to immediately implement any cuts in April since its members have already committed to shipping oil to customers around the world next month.
Data collected by analysts that track tanker movement also suggest OPEC shows few signs of letting up shipments. Vela, the tanker arm of Saudi Arabia's national oil company, is thought to be sending more shipments to American ports in the Gulf of Mexico in April than at any month since last October, said Katherine Spector, an energy strategist at Deutsche Bank.
"We might get cuts from a smaller OPEC member like the U.A.E, but more for reasons of maintenance than anything else," said Ms. Spector. "It's hard to see any significant cuts taking place."
There were reports earlier today on FR, that the Kuwaitis and the United Arab Emirates were bucking the Saudis.
Also an interesting article posted three weeks ago on FR.
The United States is making a policy shift, that it will no longer import oil from OPEC Countries, unless they are a legitimate democracy...therefore, we will only import from Iraq...effective immediately. Have a nice day...see ya!
The Saudi's need the money to keep the rabble quite.....If other countries under cut them and produce more oil instead of less than the Saudi's will have to start dribbling out the oil again to regain there lost share.
Then again with friends like the Saudi's....who needs enemies?
God, I hope not. But we as a nation should prepare for the worst.
If this be war, so be it. Kill 'em all and take the oil.
Insert "their" for "there".
You would think we'd be in a good position to set up a favorable long-term deal with the Iraqis and the Russians. They need the cash and we need the crude. Crushing OPEC by any means necessary should really be at the top of this country's to-do list.
Here's the price of gasoline in 2004 dollars.
IIRC, Jeb Bush himself led the fight to put that oilfield off limits with hysterical fears of Veldezlike oil spills fouling tourist areas. Jeb's great, but he's wrong on this one - bigtime.
Hell, if it would help, Halliburton could drill my backyard for oil if it would move this country away from the ME.
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