Gas prices to soar once again...

[waltky]

Ethanol barges stuck in flooding...

Midwest floods may add to gasoline misery
Wed Jun 18, 2008 - U.S. gasoline prices, which have already jumped to a nationwide average over $4 per gallon, may get an extra nudge from soaring costs for gasoline-additive ethanol as the worst floods in 15 years hit the Midwest Corn Belt.

The outlook is bad news for American motorists already suffering sticker shock at the gas pumps at the start of the summer driving season. "If we have prolonged rail and barge delays of getting Midwest ethanol to all the coast, then it will have an absolute upward impact on prices right now," said Stephen Schork, editor of The Schork Report in Philadelphia. "I could probably see it adding another nickel to another dime to the prices at the pump as we head toward the July 4th holiday."

The cost of corn-based ethanol, a blendstock that now makes up about 7 percent of the U.S. gasoline pool, has jumped 20 percent in two weeks as flooding damages Midwest corn crops, shuts down distilleries and disrupts rail traffic to get the ethanol to market. The surge brings the price of ethanol to about $2.90 a gallon, still well below the overall price of finished gasoline. But the increased price of the key ingredient could still filter down to drivers.

"It's certainly not helping gasoline prices," said Sander Cohan, gasoline and biofuels analyst with Energy Security Analysis Inc in Boston. "The silver lining is that ethanol is only blended up to 10 percent into gasoline, so it only has a small effect compared to say, the price of oil."

More Midwest floods may add to gasoline misery | Special Coverage | Reuters

See also:

Belgians in an uproar over high fuel prices...

Fuel price protest hits Brussels
Thursday, June 19, 2008 - Belgian farmers, truckers and taxi drivers staged protests against soaring fuel prices on Wednesday, the latest in a series of demonstrations across Europe and Asia as oil has hit record highs on world markets.

Hundreds of tractors clogged traffic as they converged on Brussels, while truckers and taxi drivers staged a go-slow on the city's inner ring road. The protests came a day before European Union leaders meet in the city to discuss how to tackle the high cost of oil.

Amid growing anger at the price of fuel, protests by truckers, fishermen and others have erupted from Spain to India, South Korea and Nepal in recent weeks. A fuel protest two weeks ago by French and Italian fishermen in Brussels turned violent, while British truckers jammed a major highway leading into London. "The cost of petrol is so high that we have nothing left to live on. It represents 47 percent of our income," said Marc Thomas, a self-employed truck driver in Brussels.

Belgian farmers say rising fuel prices are driving up costs while global competition is cutting the price of their products. "We have had it up to here. We just can't make ends meet with the prices at which we sell our products," said Anne-Marie Tasiaux, head of a regional farmers' union which distributed free milk and eggs to passers-by in the centre of Brussels.

MORE

[waltky]

And right when they were predictin' the demise of the gas guzzlin' SUV's...

Saudi Arabia Will Pump More Oil In Future To Curb Crude Prices
June 22, 2008 - Saudi King Abdullah offered to slightly increase oil production to curb soaring prices globally.

An emergency energy summit meeting convened on Sunday aimed at defusing market tensions led by higher crude prices as demand of oil in Asian region has increased. Saudi Arabia is considered as a top player in Organization of Petroleum Exporting Countries (OPEC). The current efforts is a follow up request by the U.s. President George W. Bush, who had asked the oil producing nations including Saudis to pump more oil in his visit to Riyadh in January. During President Bush's last meeting with Saudi Arabia's King Abdullah, the leader had dismissed the possibility of raising oil producing to help reducing the record setting fuel prices.

But it seems that Saudi Arabia, which dominates the oil producers' group, has realized that the global financial market has been badly affected over rising demand from Asia even though higher fuel prices have prompted U.S. consumers to cut down on gasoline usage. Being the world's largest oil-producing country, Saudi Arabia's oil minister had indicated that it will increase production rate by about 500,000 barrels per day. Saudi Arabia raised its oil production by 300,000 barrels a day in the month of May, while the delegates from the oil ministry confirmed that they would add another 200,000 barrels a day in July. The hike in crude production will raise its current levels to 9.7 million barrels per day in the next month.

The U.S. markets along with global economies have suffered due to the higher oil prices that had reached a record high to $140 a barrel. Over the past 12 months, oil rates have gone up by 80 percent, pushing gasoline prices along with goods and food rates as the U.S. economy deals with rising risks of steep inflation. The rally in energy prices continued during the week, raising warnings for the eleven leading oil consumers as the global economies weaken due to subprime mortgage turmoil in the U.S. markets. Saudi Arabia's King Abdullah, addressing the 36-nation summit hosted in its Red Sea city of Jeddah on Sunday, blamed the speculators and analysts for the hiked up prices of oil.

Saudi Arabia Will Pump More Oil In Future To Curb Crude Prices | AHN | June 22, 2008

See also:

Little hope oil summit will cut prices: Shell
Sun Jun 22, 2008 - Crisis talks over record high oil prices are unlikely to quickly turn the tables on roaring markets, the chief of Royal Dutch Shell said on Sunday.

"What I've heard so far are basically all good ideas, but it will probably not change the price tomorrow morning," Shell CEO Jeroen van der Veer told Reuters. "The mood of the meeting is all about investment, that is the way to go. For investment we need fiscal stability and security." Energy policy makers from the world's top producers and consumers, plus chief executives from big oil firms, meet in Jeddah on Sunday to seek solutions to oil's unrelenting rise, which has seen prices double over the past year.

Saudi Arabia has said in recent days it will boost production again in July to 9.7 million barrels per day (bpd), it highest rate in decades. But delegates said the final communique from the emergency meeting of world oil powers was unlikely to deliver any hard measures, focusing instead on the need for greater transparency in oil markets, increased investment and low-carbon renewable energy sources.

The meeting also highlighted the stark divide between those who believe high oil prices are purely the result of soaring demand from consuming nations and slower growth in production from those who see speculators as the primary force behind the rally, a camp that includes most OPEC members. On the causes of high prices van der Veer said: "There's nobody to blame. It's extremely complex, everybody has his own reading, but there is no one party you can point out."

Little hope oil summit will cut prices: Shell | Special Coverage | Reuters

[waltky]

Figure on 1-2 years before it hits the market...

Quest for oil, gas off Fla. begins
Fri., July. 4, 2008 - Record crude prices fuel backing for exploration off nation's shores

Oil companies once viewed drilling in the deep waters off Florida as cost prohibitive. Politicians feared even the slightest sign of support would be career suicide. No more. Record crude oil prices are fueling support for oil and natural gas exploration off the nation's shores. In Florida, movement was under way even before President Bush called on Congress last month to lift a federal moratorium that's barred new offshore drilling since 1981.

The early activity here stems from a 2006 Congressional compromise that allows drilling on 8.3 million acres more than 125 miles off the Panhandle — an area that had been covered by the moratorium, which was enacted out of environmental concerns. In exchange, the state got a no-drilling buffer along the rest of its beaches.

Florida may turn out to be a prelude for other coastal states. If oil or natural gas deposits are found in the newly opened region, experts say it could further the push to explore other once-protected areas everywhere. It also could be a rallying point for critics, who say the new exploration isn't a license to expand exploration.

More Quest for oil, gas off Fla. begins - Environment - MSNBC.com

See also:

World must brace for oil beyond $150
Fri Jul 4, 2008 - Oil's meteoric rise since the start of the year to nearly $150 has distressed consumers and policy makers the world over, but the stark reality is prices are likely to rise higher still.

For two decades, prices were relatively stable, but then they rose seven-fold from a trough below $20 in 2001. Since breaching the $100 mark on the first trading day of this year they have risen around 45 percent. Given such momentum, politicians' efforts to bring the price down could well be a waste of energy.

"It rose so fast it's got a bubble feel, but bubbles can go on for very sustained periods, and underlying that is an extremely tight fundamental position," said Stephen Thornber, head of global energy research at Threadneedle Asset Management.

Global demand of some 86 million barrels per day is almost level with supply, and production growth is not keeping pace with soaring demand from emerging economies such as India and China.

Citing the strength of Asian demand, investment bank Morgan Stanley last month predicted oil would reach $150 a barrel by the Fourth of July holiday in the United States, usually one of the busiest U.S. travel days. Their target proved just out of reach, with U.S. crude stopping short at a record of $145.85.

More World must brace for oil beyond $150 | U.S. | Reuters

[waltky]

Fearless W doin' his part to lower oil prices...

Bush Lifting Offshore Drill Ban
Monday, Jul. 14, 2008 (WASHINGTON) — In another push to deal with soaring gas prices, President Bush on Monday will lift an executive ban on offshore drilling that his stood since his father was president. But the move, by itself, will do nothing unless Congress acts as well.

The president plans to officially lift the ban and then explain his actions in a Rose Garden statement, White House press secretary Dana Perino said. There are two prohibitions on offshore drilling, one imposed by Congress and another by executive order signed by former President Bush in 1990. The current president, trying to ease market tensions and boost supply, called last month for Congress to lift its prohibition before he did so himself.

But Perino said Bush no longer wants to wait. She pinned blame on the leaders of the Democratic Congress, noting that no action has been taken on this issue. "They haven't even held a single hearing," Perino said. "So we are going to move forward, and hopefully that will spur action by the Congress." Asked if Bush's action alone will lead to more oil drilling, Perino said, "In terms of allowing more exploration to go forward? No, it does not."

The president, in his final months of office, has responded to record gas-prices with a series of proposals, including more oil exploration. None would have immediate impact on prices at the pump, according to White House officials, who say there is no quick fix. But starting action now would help, they say.

MORE

[waltky]

Guess what it will do to oil prices...

We'll hit oil pipelines, say militants
July 24, 2008 - THE main militant group in Nigeria's oil-producing Niger Delta says it will attack major oil pipelines in the next 30 days to prove it had not received payment from the government to end its campaign.

The head of the state-run oil firm NNPC was quoted in Nigerian newspapers as saying the company had paid militant groups $12 million to protect facilities including the Chanomi creek pipeline in Delta state. The Movement for the Emancipation of the Niger Delta (MEND), whose attacks have cut Nigeria's oil output by around a fifth since early 2006, said the money had gone to criminal gangs and that genuine "freedom fighters" could not be bought off.

"MEND is aware that huge payments have been made to some criminal gangs in Delta state as a protection fee...MEND will never sell its birthright for a bowl of porridge," the group said in a statement. "To prove that we are not a part of this deal, the Chanomi creek pipeline and other major pipelines will be destroyed within the next 30 days."

Bomb attacks on pipelines in the delta, the hub of Africa's biggest oil industry which produces around two million barrels per day, have disrupted supplies from the world's eighth biggest oil exporter and helped push global energy prices to record highs. Anglo-Dutch giant Royal Dutch Shell, whose facilities have been amongst the worst hit by MEND's campaign of sabotage, has a pipeline in the Chanomi creek which feeds into the Forcados oil export terminal.

We'll hit oil pipelines, say militants | NEWS.com.au

[waltky]

This should please the speculators...

OPEC official says output cuts may be needed
Aug. 16, 2008 -- An Iranian official in the Organization of Petroleum Exporting Countries said Saturday that the producers group is considering leaving oil production levels unchanged or perhaps even trimming them to shore up flagging prices and defend market share.

"The market is oversupplied by at least 1 million barrels a day. If OPEC would like to remove this additional oil out of the market, then OPEC has to cut some production," OPEC governor Mohammad Ali Khatibi told Dow Jones in a telephone interview. "There will be maybe two options. One option is maintaining the level of production. It means OPEC will roll over the production. The other option will be some decrease in production," he added. The topic will lead OPEC's agenda when representatives of the group's 13 member nations gather Sept. 9 in Vienna to discuss production policy.

Oil prices peaked in early July at over $145 a barrel. They have since fallen 22% as the high prices carved deeply into demand, especially in the transport sector. The September crude oil futures contract closed Friday at $113.77 a barrel on the New York Mercantile Exchange, a fresh three-month low. See Futures Movers. Khatibi's comments come just a day after OPEC said higher prices and weak economic conditions in most industrialized nations are slowing global oil demand. "Summer strong oil demand growth in China, Middle East and Asia has not been enough to offset the huge decline in OECD oil demand in the second quarter," the producers group said Friday in its monthly oil report.

The group's latest estimate trims 2008 demand growth by 30,000 barrels per day -- its fifth consecutive month of downward revisions. The group now estimates global oil demand this year will average 86.9 million bpd. It sees demand inching up to 87.8 million bpd next year. At the same time, the revised forecast sees oil demand from OPEC's members slipping to 32.1 million bpd, or 100,000 bpd less than in 2007. The 2009 forecast extends the trend, with demand for OPEC oil easing to an average of 31.3 million bpd. The drop is the result of slowing demand growth and oil coming into the market from newly developed fields in non-OPEC nations. OPEC claims it has bumped up output to help calm the volatile oil market, pumping 32.64 million bpd in July, or 780,000 bpd more than in April. The group's monthly report also said OPEC is now producing "well above the demand for its crude."

Source