Oil is going down and is staying down for a while

[FAH1223]

http://www.bloggingstocks.com/2008/10/1 ... oil-price/

[Padishah]

I have some news for you. Your Socialist hero is methodically wasting the capital brought in by oil revenue on 'exporting the revolution', instead of investing it prudently to ensure a continued revenue stream.

________________________________________

Venezuela's oil output slumps under Hugo Chavez
By Jeremy McDermott in Caracas

To win allies and forge an anti-American front, Mr Chavez sells oil to friendly countries at low prices. Ironically, the only big customer buying Venezuelan oil at the full market price is the United States, which the president routinely denounces as the "Empire".

"As production falls, the sales to the US become more important," said Pietro Donatello, an oil analyst from Latin Petroleum in the capital, Caracas. "Only the US is paying the full amount for Venezuelan oil and in cash, the rest are in some kind of barter agreements."

The state oil company, PDVSA, produced 3.2 million barrels per day in 1998, the year before Mr Chavez won the presidency. After a decade of rising corruption and inefficiency, daily output has now fallen to 2.4 million barrels, according to OPEC figures. About half of this oil is now delivered at a discount to Mr Chavez's friends around Latin America. The 18 nations in his "Petrocaribe" club, founded in 2005, pay Venezuela only 30 per cent of the market price within 90 days, with rest in instalments spread over 25 years.

The other half - 1.2 million barrels per day - goes to America, Venezuela's only genuinely paying customer.

Meanwhile, Mr Chavez has given PDVSA countless new tasks. "The new PDVSA is central to the social battle for the advance of our country," said Rafael Ramirez, the company's president and the minister for petroleum. "We have worked to convert PDVSA into a key element for the social battle."

The company now grows food after Mr Chavez's price controls emptied supermarket shelves of products like milk and eggs. Another branch produces furniture and domestic appliances in an effort to stem the flow of imports. What PDVSA seems unable to do is produce more oil.

Venezuela has proven reserves of 80 billion barrels, but estimates suggest that it may possess 142 billion barrels - more than anywhere else except Saudi Arabia. But the crude is of low quality and must be upgraded before it can be shipped. There are only three upgrade units currently operating, processing only 600,000 barrels per day.

"There is a bottleneck in the Venezuelan production system," said Mazhar al-Sheridah, 68, an oil expert at the Central University of Venezuela. "It will cost at least $32 billion to build another three upgrading units and take some five years, meaning that Venezuelan production is stuck at current levels for a while yet."

All this means that Venezuela has missed much of the benefit from the oil boom and, now that prices are falling, Mr Chavez faces huge financial problems. Nobody is sure at what point his government would be unable to pay its bills, but most sources consulted believe this would probably happen if oil falls to $80 a barrel. Yesterday, oil was trading at $79.80.

[Cawar]

The Arab rulers dont want Obama to get elected..thats why they are conspiring with their American counter parts to lower the gas prices at this crucial time in the campaign.

[The-Screw]

The Arab rulers dont want Obama to get elected..thats why they are conspiring with their American counter parts to lower the gas prices at this crucial time in the campaign.

gee, ya think?! Obama promised to cut oil dependence within 10 years, that is bad business forecast for these fat arabs who built skyscrapers in the desert while partying in 100m yachts in St. Tropez. fock 'em.

[Cawar]

I honestly dont think Obama will differ McCain..when it comes to the US national interest and foreign policy..
I have no delusions over that.

The only and the main diference would be..that he will be considered unlike Bush and the world would try to meet him in the middle if he is willing to do so.

[sheekh-Farax-zero]

i don't understand why the feul price at gas-station is still high
while the oil price is falling daily.

[FAH1223]

i don't understand why the feul price at gas-station is still high
while the oil price is falling daily.

in my area fuel is dropping every day

we're under $3 a gallon in some places

they project gas to go all the way down to $2-$2.30 a gallon by thanksgiving

[QansaGabeyle]

they project gas to go all the way down to $2-$2.30 a gallon by thanksgiving

It would be so awesome if gas became $2 a gallon again!

[FAH1223]

they project gas to go all the way down to $2-$2.30 a gallon by thanksgiving

It would be so awesome if gas became $2 a gallon again!

happened 2 years ago before the midterm elections

i wish i had my car and license back then

[QansaGabeyle]

I never used to pay attention to gas prices then wallahi because I rarely used to go any further and besides I used to take the train more than I drove. But yeah it will be nice if gas prices continue to go down, it is already $2.60 at where I live. High gas prices is the only way the bad economy affected me since I drive for hours everyday.

[sheekh-Farax-zero]

in my area fuel is dropping every day

we're under $3 a gallon in some places

they project gas to go all the way down to $2-$2.30 a gallon by thanksgiving

a gallon is 5litter ok,, we pay almost 10 Euro for a gallon,, that is $13,70

[QansaGabeyle]

^ True but you don't work for your money. You get it for free and you drive small cars that use less gas than a bicycle. I heard income tax in some European nations as high as 60 percent. No wonder people don't want to work there.

[sheekh-Farax-zero]

who told you that i don't work,, do you think pple in Europe all take Lacagta caydha,

[QansaGabeyle]

do you think pple in Europe all take Lacagta caydha,

They don't?