Saudi oil the wrong kind of crude

http://www.dailytimes.com.pk/
Sunday October 10, 2004

LONDON: The world’s oil refiners are unimpressed by Saudi Arabia’s boost to production capacity that would only swell supplies of sour, high sulphur crude while they hanker for sweet oil.

US oil prices still hovered near $50 on Wednesday, testimony to the indifference to Riyadh’s pledge to hoist official production capacity by 500,000 barrels per day (bpd) to 11 million bpd.

“Most refiners couldn’t take more sour if they tried,” said one refiner, who asked not to be named. “We have a glut of sour crude and a short supply squeeze on low sulphur crude oil and products, so extra Saudi makes no difference whatsoever,” a physical oil trader said.

Riyadh’s new increment, together with capacity expansions in Kuwait and Iran will add some 900,000 bpd of new sour crude capacity by year’s end.

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Please limit yourself to four paragraphs plus link.

Matt Simmons says sweet light crude has peaked allready. I say NYMEX futures will hit $60 before the end of year, and next year who knows... anywhere from 100-500 dollars.

Arab Medium, Arab Sour. How about Light Sweet Oil. Would you like a little bit on your salad tonight?

Arab Light sounds like a new Middle Eastern Beer. I think I'll pass on that.

Seriously though, our addiction to oil has finally gotten to a crisis stage. If anyone wants to read more about Peak Oil, or the fact that the Saudis don't really know how much oil they really have, tune in to:

http://www.fromthewilderness.com/

?

The problem with getting oil to market, in addition to the COST (projected to hit sixty a barrel in the months ahead, last I heard it was around fifty three) is REFINING CAPACITY. The crappier the oil, the more time it takes to refine it. Light, sweet crude just needs a magic wand waved over it. The number of refineries are limited and stressed already to produce enough to prevent shortages. If there is a backlog in the pipeline due to refining capacity, that will impact supply, at a time when what we most need is heating oil for the winter months ahead.

If the Saudis are "doing their part" to "help us" by increasing capacity of sour oil, that's like saying to a starving person "Here is a bowl of rice, but it is mixed with a ton of manure--pick out the grains and you are hungry no more." Gee, thanks a lot, assholes.

Looks like Bandar Bush just fucked his beloved brother weecowboy up the wazoo. Either that, or they are working together so weewee can make a case for increased nuclear (or nuke-you-lar) power plants--he probably has the right investments in place already against that happy day for him.

This has implications THIS WINTER for anyone who heats their home with oil, and it will have a ripple effect in terms of price regardless of method used.

Might I make a suggestion to anyone who lives in a cold climate and heats with oil--FILL YOUR TANKS NOW. Do NOT wait, do it NOW. Also, get your butts down to Home Depot, or your local hardware store, and get some weatherstripping and all the happy crap you use to winterize your home. Get in the habit of lowering your thermostat, and as the days get cooler, first put that sweater on. Wearing a cap indoors also will keep you warm--you lose a lot of heat through your head. And pray for a mild winter this year. It looks like it could be a rough time for those living on the edges, with little to spare if/when energy costs spike.