a goodly portion of their cracking is done at the HOVENSA plant on St.Croix, USVI.
Posted on 04/02/2006 7:54:32 PM PDT by aculeus
Venezuelan president Hugo Chávez is poised to launch a bid to transform the global politics of oil by seeking a deal with consumer countries which would lock in a price of $50 a barrel.
A long-term agreement at that price could allow Venezuela to count its huge deposits of heavy crude as part of its official reserves, which Caracas says would give it more oil than Saudi Arabia.
"We have the largest oil reserves in the world, we have oil for 200 years." Mr Chávez told the BBC's Newsnight programme in an interview to be broadcast tonight. "$50 a barrel - that's a fair price, not a high price."
The price proposed by Mr Chávez is about $15 a barrel below the current global level but a credible long-term agreement at about $50 a barrel could have huge implications for Venezuela's standing in the international oil community.
(Excerpt) Read more at business.guardian.co.uk ...
I don't believe for one second that Venezuela will be able to do this, but from the standpoint of now, it wouldn't be a bad thing if they did. They would sell everything they could pump out of the ground, and effectively lower the average cost of a barrel of crude. Going forward to the inevitable downturn, this would have less of an effect, because it just would not be purchased at an above market price, unless there were to be some sort of contractual obligation to do so. And, anyone who trusts Chavez to uphold a contract is a fool.
Could this be an indication of a shake-up in OPEC?
Of course the premise of pegging a price at $50 a barrel will seem nice at first, but that is a VERY socialist/communist idea with a price control type situation.
There are not many places that can refine their sour crude.
If Saudi Arabia agrees on this it will be done, if it does not, then it up to the market to decide on the price of oil.
Signing a long term contract at a set price to avoid volatility does not equate with price controls. Willing buyer, willing seller. Chavez would turn Venezuela into an OPEC pariah by pursuing this, though.
This guy nationalized a bunch of stuff. His agreement is not worth the paper it is written on. If the price for his crude goes below 50 dollars, he wins. If it goes about 50 dollars, he simply voids the agreement.
And the value of his heavy sour crude is probably about 50 dollars now.
Chavez is an idiot...the price of oil will be decided by the market and not what this tin horn thinks...
He is going to piss off his OPEC brothers if he keeps this crap up...
I wonder if he meant 50 denominated in Euros? He must have because he has been all pro Iranian Euro denominated bourse ra ra...
Oil tonight is trading at 55.1045 Euros....and 65.550 USD
If he were a rational person I'd say he's telegraphing fear.
But he's not rational.
Natiional Geographic has an article in this month's issue on Chavez and his socialist revolution that is nothing more than a butt-kissing slobber piece about the guy being great for the common person (reminds me of the stuff the press wrote about Castro and Cuba in the 60's and 70's.)
a goodly portion of their cracking is done at the HOVENSA plant on St.Croix, USVI.
i only wish it WERE the market driving the price of oil... it's the big oil Speculators on Wall Street driving the price.
Ping
ExxonMobil's outgoing CEO (Lee Raymond) and their current CEO (Rex Tillerson) BOTH project a drop in oil prices to that level or lower over the next few years.
Yep....he's a scumbag of the 1rst order.
And we are into him cuz the left won't even let us drill our own oil.
I think you are right, I may have confused the market with the knee jerk oil speculators who are causing us a lot of trouble lately.
Ridiculous--OPEC has far more power than Wall Street oil speculators over the long-term price.
they are talking about heavy crude, not great for refnining into gasoline
Apparently Chavez' voter base is happy he's forcing those with two homes to give up one of them. As in, confiscation and land distribution. Take from those who have and give to those who have not.
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