Some oil executives worry prices may fall

NEW YORK Hold on to your gas guzzlers: Cheap oil may once again be just around the corner. Even as consumers worry about high gasoline prices and rising heating bills, oil executives in London, Texas and Saudi Arabia seem to be concerned about a prospect of falling oil prices.

In a recent speech in Singapore, John Browne, the chief executive of BP, spoke of a possible sharp drop in prices and called current levels "unsustainably high."

John Hofmeister, head of Shell Oil in the United States, said during an interview, "This high price cycle is artificially inflated."

Today, producers are again under pressure to step up production and refining, and to increase investments to get more oil to the markets quickly. But oil executives and government ministers are concerned that if demand slowed down, even a little bit, those investments might create a large oversupply in two to three years, pushing prices down again.

http://www.iht.com/articles/2005/12/04/business/outoil.php

You read my mind. That is what I was thinking also. :rofl:

I think I missed that one.

see here: http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x1967762


CIA-4 explosives used to keep cheap gas from impoverished Americans, if you ask me.

He's pissed off at Chavez for giving low priced oil to the poor here.

:puke:

Oh.My.God! Prices might fall! My bonus is in jeopardy!

:puke:

Hmm...who "artifically inflated" prices, I wonder?

The cost of oil a barrel is about 20% of what we pay at the pump.

Refining, distribution costs are pretty fixed for us.

We really are screwed here. Pains me to say it.

And we do not have "2-3" years, in any event.


Joe

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It just popped into my mind when I read this horseshit.
:hi:

They admit it? Shows how brash they are. If we had a President with as much sack as bravado, we'd take them to task on this.

There's no mercy being shown here. They're getting afraid that too many people are going to adjust their habits, that's all. They know that SUV's are tanking and they have been driving demand in the last decade. The price is an artificial figure anyway. WTF?--they think we believe it costs 2-3X as much to produce than 5 years ago? Gimme a break.

I guess time will tell.

Peace.

I think an oil executive would say prices are going to fall

the peak oil models all anticipate instability and price fluctuations- major peaks and valleys.

What you look at over the long term is a line called the moving average. That most assuredly will rise steadily over the next decade and perhaps faster than most of the current projections, based on rapidly increasing demand in Asia.

Near the top of the peak and all the way down the back side of the curve prices will be most sensitive to demand. As the article says, even slight reductions in demand, or perhaps more accurrately, reduction in rate of increase in demand, will effect prices.

This is why the big five are not investing significantly more in E & P (Exploration and Production) than they were at $26/bbl.

It is also important to know that the "Big 5" of Shell, Exxon-Mobil, BP, Chevron-Texaco, and Conoco-Phillips are not so very big in the grand scheme of things. Most of the World's oil and gas reserves and production capacity belong to national oil companies like Saudi Aramco, PDVSA, Statoil, Petronas, ADNOC, etc.

On the upside of the curve production had the dominate influence on price. I think we are seeing the beginning of the domination of demand on price that is characteristic of the downside of the curve.

what to do with it all. This must just be theater.

Gas prices aren't going to go up ;).

my heart bleeds for them!:nopity:

:sarcasm: