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$250 A Barrel Oil???

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Anonymous

Guest
Today 5/29/2006 4:20:00 PM


Sanctions Could Lead To $250/Bbl Oil - Iranian Lawmaker

TEHRAN (Dow Jones)-- World crude prices are moving toward $100 a barrel and could hit $250/bbl if sanctions are imposed on Iran, a prominent Iranian lawmaker said Monday.

"The price of oil will certainly reach $100/bbl, and it is out of anyone's hands to do anything about it," Kamal Daneshyar, chairman of the Iranian Parliament's Energy Committee, told Dow Jones Newswires in a telephone interview. He said the move toward the $100/bbl mark stems partly from demand exceeding supply.

"The consumption of oil in the world has outstripped its production," he said. He also predicted that if the Western world, led by the U.S., imposes trade and economic sanctions against Iran, crude oil prices will rise to around $250/bbl.

"The world will have to watch the transport of a large quantity of its needed oil through the narrow Starit of Hurmuz," said Daneshyar who has generally favored high oil prices. About two-fifths of the world's oil supplies pass through the Strait of Hormuz, the 54-kilometer-wide entrance to the Persian Gulf that passes between Iran and the United Arab Emirates.

He said the jump in the price of oil to $250/bbl will come from the punitive measures against Iran and it will be by no means certain that in the event of sanctions Iran would sit back and let others go on exporting their oil through the waterway as if nothing had happened.

"It would be wrong to think that (the West) can subject Iran to sanction with business as usual for other exporters," he said. Higher oil prices are being supported in part by tensions over Iran and its nuclear program.

The fear is Iran could halt exports if sanctions are imposed against it adding further to the tight supply. Iran is accused by the Western powers of concealing its nuclear weapons under the guise of a civilian nuclear program. The five permanent members of the U.N. Security Council are deadlocked over how to deal with the situation.
 

Manitoba_Rancher

Well-known member
Im glad to see so much interest in the new bio-diesel plants going up around these parts. If they start making it out of Canola all the farmers will be wearing Turbans and bowing to Osama..... :wink: :shock: :lol: :lol:

Its about time they started making fuel out of something other than that middle east oil...

As for Iran they are no more than a trouble maker that needs to be taken care of before things get out of hand.... I agree with you Jigs... nuke'em
 

RoperAB

Well-known member
That article is crap
It doesnt have to be that way. Here read this.
http://www.manhattan-institute.org/html/_wsj-oil_oil.htm

Oil, Oil, Everywhere . . .
January 27, 2005

By Peter Huber and Mark Mills

The price of oil remains high only because the cost of oil remains so low. We remain dependent on oil from the Mideast not because the planet is running out of buried hydrocarbons, but because extracting oil from the deserts of the Persian Gulf is so easy and cheap that it's risky to invest capital to extract somewhat more stubborn oil from far larger deposits in Alberta.

The market price of oil is indeed hovering up around $50-a-barrel on the spot market. But getting oil to the surface currently costs under $5 a barrel in Saudi Arabia, with the global average cost certainly under $15. And with technology already well in hand, the cost of sucking oil out of the planet we occupy simply will not rise above roughly $30 per barrel for the next 100 years at least.

The cost of oil comes down to the cost of finding, and then lifting or extracting. First, you have to decide where to dig. Exploration costs currently run under $3 per barrel in much of the Mideast, and below $7 for oil hidden deep under the ocean. But these costs have been falling, not rising, because imaging technology that lets geologists peer through miles of water and rock improves faster than supplies recede. Many lower-grade deposits require no new looking at all.

To pick just one example among many, finding costs are essentially zero for the 3.5 trillion barrels of oil that soak the clay in the Orinoco basin in Venezuela, and the Athabasca tar sands in Alberta, Canada. Yes, that's trillion -- over a century's worth of global supply, at the current 30-billion-barrel-a-year rate of consumption.

Then you have to get the oil out of the sand -- or the sand out of the oil. In the Mideast, current lifting costs run $1 to $2.50 per barrel at the very most; lifting costs in Iraq probably run closer to 50 cents, though OPEC strains not to publicize any such embarrassingly low numbers. For the most expensive offshore platforms in the North Sea, lifting costs (capital investment plus operating costs) currently run comfortably south of $15 per barrel. Tar sands, by contrast, are simply strip mined, like western coal, and that's very cheap -- but then you spend another $10, or maybe $15, separating the oil from the dirt. To do that, oil or gas extracted from the site itself is burned to heat water, which is then used to "crack" the bitumen from the clay; the bitumen is then chemically split to produce lighter petroleum.

In sum, it costs under $5 per barrel to pump oil out from under the sand in Iraq, and about $15 to melt it out of the sand in Alberta. So why don't we just learn to love hockey and shop Canadian? Conventional Canadian wells already supply us with more oil than Saudi Arabia, and the Canadian tar is now delivering, too. The $5 billion (U.S.) Athabasca Oil Sands Project that Shell and ChevronTexaco opened in Alberta last year is now pumping 155,000 barrels per day. And to our south, Venezuela's Orinoco Belt yields 500,000 barrels daily.

But here's the catch: By simply opening up its spigots for a few years, Saudi Arabia could, in short order, force a complete write-off of the huge capital investments in Athabasca and Orinoco. Investing billions in tar-sand refineries is risky not because getting oil out of Alberta is especially difficult or expensive, but because getting oil out of Arabia is so easy and cheap. Oil prices gyrate and occasionally spike -- both up and down -- not because oil is scarce, but because it's so abundant in places where good government is scarce. Investing $5 billion dollars over five years to build a new tar-sand refinery in Alberta is indeed risky when a second cousin of Osama bin Laden can knock $20 off the price of oil with an idle wave of his hand on any given day in Riyadh.

The one consolation is that Arabia faces a quandary of its own. Once the offshore platform has been deployed in the North Sea, once the humongous crock pot is up and cooking in Alberta, its cost is sunk. The original investors may never recover their capital, but after it has been written off, somebody can go ahead and produce oil very profitably going forward. And capital costs are going to keep falling, because the cost of a tar-sand refinery depends on technology, and technology costs always fall. Bacteria, for example, have already been successfully bioengineered to crack heavy oil molecules to help clean up oil spills, and to mine low-grade copper; bugs could likewise end up trampling out the vintage where the Albertan oil is stored.

In the short term anything remains possible. Demand for oil grows daily in China and India, where good government is finally taking root, while much of the earth's most accessible oil lies under land controlled by feudal theocracies, kleptocrats, and fanatics. Day by day, just as it should, the market attempts to incorporate these two antithetical realities into the spot price of crude. But to suppose that those prices foreshadow the exhaustion of the planet itself is silly.

The cost of extracting oil from the earth has not gone up over the past century, it has held remarkably steady. Going forward, over the longer term, it may rise very gradually, but certainly not fast. The earth is far bigger than people think, the untapped deposits are huge, and the technologies for separating oil from planet keep getting better. U.S. oil policy should be to promote new capital investment in the United States, Canada, and other oil-producing countries that are politically stable, and promote stable government in those that aren't.
 

Jinglebob

Well-known member
We are setting on top of oil where I live, but they tell me it costs too much to get it to the refineries. So until they build closer to us to make it less costly to get and use, we will set on it.

I talked to a guy in Medora this weekend and he told me that the oil coming down out of Canada is filling the piplelines so they will only pay 33 bucks a barrel for the oil in South Eastern Montana.

Good ol NAFTA.
 

RoperAB

Well-known member
Jinglebob said:
We are setting on top of oil where I live, but they tell me it costs too much to get it to the refineries. So until they build closer to us to make it less costly to get and use, we will set on it.

I talked to a guy in Medora this weekend and he told me that the oil coming down out of Canada is filling the piplelines so they will only pay 33 bucks a barrel for the oil in South Eastern Montana.

Good ol NAFTA.

:lol: :lol: Please explain how good old NAFTA is hurting your economy by providing you cheap energy? :lol: :lol: :lol: :lol:
BTW The Alberta government makes roughly $1 off every barrel of oil that goes south!
Haliburton made more money last year than the entire GDP of Canada!
Please provide some links or charts to show us how America could ever meet its energy requirements without imports from Canada.
Like what are you trying to say? That we are some how screwing you?
Totally unfriggen believable :roll: :roll: :roll:
 
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