Archive for the ‘price’ Category

OPEC Meeting Unable to Set Production Goals, Prices – For Now

November 29, 2008

OPEC ended a hastily convened meeting in Cairo Saturday without announcing new output cuts, despite the steep drop in crude prices and the threat it poses to member governments’ national budgets.

The oil producing group’s president, Chakib Khelil, said OPEC is concerned about the weakening world economy and its impact on oil prices. The group, however, will likely wait until a meeting in Algeria on Dec. 17 to decide whether to cut additional crude supplies from the market.

Khelil said oil ministers of the Organization of Petroleum Exporting Countries “agreed to take any additional action on 17th of December to balance oil supply and demand and achieve market stability.”

By TAREK EL-TABLAWY and ADAM SCHRECK, Associated Press Writers

Saudi oil minister Ali al-Naimi is surrounded by journalists ... 
Saudi oil minister Ali al-Naimi is surrounded by journalists during the Organization of Arab Petroleum Exporting Countries (OAPEC) meeting in Cairo, Egypt, Saturday, Nov.29, 2008. OPEC oil ministers downplayed expectations of, but didn’t dismiss outright, an immediate output cut as they faced a third test in as many months of their ability to engineer a rebound in oil prices.(AP Photo/Amr Nabil)

His comments came after the group convened what it called a consultative meeting in Cairo to take stock of market situations and to asses whether members were complying with a 1.5 million barrel per day output cut announced Oct. 24 in Vienna, Austria.

Khelil said preliminary market data indicated members were complying with the earlier cuts.

Saudi Arabia’s king said in an interview published Saturday in a Kuwaiti newspaper that the price of oil should be $75 a barrel, much higher than it is now, but the conclusion of the Cairo meeting with no announcement on output indicated no measures would likely be taken until OPEC meets again next month.

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http://news.yahoo.com/s/ap/20081129/ap_on_bi_ge/ml_opec_meeting;_ylt=Am
EwHA1NJCG3tEyQPVj2nDms0NUE

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Rain In Vietnam Slows Crop Deliveries; Drives prices….

November 10, 2008

By Claudia Carpenter

Nov. 10 (Bloomberg) — Robusta coffee rose for a second day in London on speculation rain will slow shipment of a record crop from Vietnam, the world’s largest grower.

Rains in central and southern Vietnam may disrupt collection and transportation of beans, according to U.S. weather forecaster Meteorlogix LLC. Coffee dropped 22 percent last month as Vietnam began harvesting the crop estimated by the U.S. Department of Agriculture at a record 21 million bags. Commodity prices climbed following gains in crude oil and a drop in the dollar.

“Rains delay the whole process,” said Stefan Uhlenbrock, senior commodity analyst at German research company F.O. Licht. “They do not have in-house drying facilities so they have to more or less dry the coffee outside.”

Robusta for January delivery rose $22, or 1.3 percent, to $1,762 a metric….

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http://www.bloomberg.com/apps/news?pid=20601012&sid=aW9Xp8vyLF_c

By Claudia

Iran: OPEC may need further cut if prices drop

November 6, 2008

OPEC may need to cut its oil output more but it remained too early to tell if a further reduction was needed, Iran’s OPEC governor Mohammad Ali Khatibi told Reuters on Wednesday.

“It is too soon to say whether OPEC’s November cut agreement has been successful. We should wait and see,” Khatibi said.

“But if crude prices continue to fall, then an additional OPEC cut may be needed.”

The producer group agreed to cut output from November 1 by 1.5 million barrels per day (bpd) after oil prices dived from a July record of $147 a barrel to less than half that. U.S. crude was trading around $68 a barrel on Wednesday.

Venezuela said on Tuesday it will propose another cut of 1 million bpd at the cartel’s next meeting, which is expected to be held in December.

Iran, the world’s fourth largest oil producer, has already started informing buyers that it is cutting back sales. Iran’s share of OPEC cut was 199,000 bpd.

“Iran and other OPEC members have been committed to OPEC’s November cut agreement,” Khatibi said.

“Creating a balance between oil supply and demand is OPEC’s priority.”

An oil pump decorated to look like a bird stands at rest Wednesday, ...
An oil pump decorated to look like a bird stands at rest Wednesday, Nov. 5, 2008, in oil fields near Awali, Bahrain. Oil prices slid below US$68 a barrel Wednesday on expectations a slowing global economy will cut crude demand, and even indications OPEC is enacting its decision to take a daily 1.5 million barrels from the market failed to support prices.(AP Photo/Hasan Jamali)

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http://news.yahoo.com/s/nm/20081105/bs_nm/us_iran_opec_1

Opec talks push oil prices higher

October 29, 2008

Global oil prices have risen on growing expectations that producers’ cartel Opec will vote to cut production.

US light crude was up $2.09 at $73.94 a barrel, with Brent up $2 at $71.62, ahead of Opec’s meeting on Friday.

Fears of a global economic slowdown have pushed oil prices down by half since July’s all-time highs.

Gulf of Mexico oil rig

Opec is meeting in Vienna on Friday

A number of Opec members, including Algeria, Iran and Venezuela, have already said they would like to see output cut to help shore up prices.

Growth risks

Opec’s meeting has been brought forward by three weeks in response to the recent fall in oil prices.

Algeria’s energy minister and Opec president Chakib Khelil said he expected the organisation to announce “substantial” output cuts.

Most oil analysts are now in agreement, with Merrill Lynch estimating that production could be cut by one million barrels per day.

Energy consultancy CGES says Opec will argue that it has to cut production to prevent a further “price collapse”.

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http://news.bbc.co.uk/2/hi/business/7680671.stm

OPEC slashes production; crude continues to tumble

October 24, 2008

OPEC said at an emergency meeting Friday that it will slash oil production by 1.5 million barrels to stem the “dramatic collapse” of oil prices, but crude prices plunged 7 percent anyway as financial markets spiraled downward across the globe.

By GEORGE JAHN, Associated Press Writer

Demand for crude has evaporated and the supply levers held by the Organization of Petroleum Exporting Countries appear to have little influence in the current economic climate.

Iran and Venezuela pushed for a cut of 2 million barrels a day, but there were concerns among other OPEC members that a more severe production cut would exacerbate a deteriorating economic crisis and further destroy demand.

OPEC officials, however, signaled they were prepared to slice deeper quickly if crude continues its freefall.

OPEC is already producing 300,000 barrels a day above its own quota of about 29 million barrels.

If that overproduction is stopped, and all members comply with the 1.5-million cut, OPEC would produce about 1.8 million fewer barrels of oil a day.

OPEC officials, however, left no doubt that they were ready to slice production again quickly if Friday’s decision does not end the price freefall.

The emergency meeting was initially scheduled for Nov. 18, but that was abruptly rescheduled for Friday in response to prices that have entered a tailspin since their historic high of nearly $150 in July.

OPEC President Chakib Khelil said OPEC was ready to convene another emergency session before its next planned gathering in December in Algeria “if there are further decisions that have to be made.

Analyst John Hall of London-based John Hall Associates said the OPEC decision will not have a dramatic effect, adding he assumed any upward trend would stop at between $80 and $90.

But there was no such trend Friday as markets plunged global and fear of an extended recession spread.

Wall Street joined world stock markets in a precipitous plunge, with the Dow Jones industrials dropping more than 400 points in the opening minutes of trading.

Oil futures slid $4.46 to $63.38 a barrel on the New York Mercantile Exchange.

“It’s clear that the ministers are attempting to underpin at $60 a barrel,” said James R. Crawford an analyst with Inter Emirates. “But where the market will settle remains open.”

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http://news.yahoo.com/s/ap/20081024/ap_on_bi_ge/eu_opec_
meeting;_ylt=AtVi.2T5ipPpGTmFXXdm3Ais0NUE

OPEC Ponders Price Rise, Production Cut

October 23, 2008

VIENNA (AFP) – OPEC President Chakib Khelil said Thursday that the oil producers’ cartel will decide to cut production at an emergency meeting due in Vienna but was wary of worsening a global financial crisis.

Chart showing the price of New York light sweet crude from January ... 

“We are going to reduce (output on Friday). By how much? We don’t know. This is something we are going to decide tomorrow,” Khelil, who is also the energy minister of OPEC member Algeria, told reporters in Vienna.

“It’s a concern that we could make the financial crisis worse by taking too strong a reduction,” said Khelil, adding however that the decision “should not impact the world economy which is already in pretty bad shape.”

Iran — OPEC’s second biggest oil exporter — and Libya both called for a reduction of two million barrels per day, while Venezuela said there should be a cut of at least one million barrels.

British Prime Minister Gordon Brown recently said that any reduction made in a bid to push up oil prices would be “scandalous” at a time when major economies are close to recession.

The price of New York oil dived Thursday to a 16-month low, as recession fears stoked concerns about falling crude demand, traders said.

New York’s main contract, light sweet crude for December delivery, sank as low as 65.90 dollars per barrel — a level last seen on June 13, 2007.

Crude futures in New York and London have plunged 56 percent from record highs of above 147 dollars a barrel reached only three months ago when supply concerns sent prices soaring.

“The market focus today (Thursday) and particularly tomorrow will be on the OPEC emergency meeting,” said analysts at Barclays Capital in London.

“Indicating the inevitability of a substantial cut, Chakib Khelil, the OPEC president, commented yesterday that ‘the stocks are very high… some of us are not able to sell the crude.'”

The Organization of Petroleum Exporting Countries produces 40 percent of the world’s oil and its official output quota stands at 28.8 million barrels per day.

Saudi Oil Minister Ali al-Nuaimi refused to be drawn on talk of a scaling-back to output as he arrived in the Austrian capital on Thursday.

However Libya’s Oil Minister Shukri Ghanem told reporters that “a huge cut” of “two million barrels” was required to create a balance between supply and demand.

Venezuelan Energy Minister Rafael Ramirez said there should be a cut of at least one million barrels. Ramirez added that he believed there was a consensus among OPEC’s 12 members for a cut.

OPEC’s Gulf state members led by Saudi Arabia, the world’s biggest oil exporter, are expected to oppose a reduction of more than one million barrels, analysts said on Thursday.

Read the rest:
http://news.yahoo.com/s/afp/20081023
/bs_afp/opeccommoditiesoilprice

Oil Prices Slip Below $70 a Barrel

October 17, 2008
Oil prices dropped below $70 a barrel for the first time in 14 months Thursday, prompting the OPEC cartel to call for an emergency meeting next week to establish some stability in prices that have plummeted recently after rising for months.

Above: Photo from Getty Image’ David McNew

Oil prices have tumbled by nearly $40 a barrel in just three weeks as indications grow that demand for energy will slow along with weakening economies around the world. As recently as July, oil was trading at a record of $145 a barrel.

The decline in oil prices could provide a form of stimulus to the economy as consumers pay less to fill up their tanks. If oil prices stay at current levels, consumers would have $250 billion more, over a year, to save or spend elsewhere, according to Lawrence Goldstein, an energy economist. Some analysts expect oil prices to keep declining, perhaps to as low as $50 a barrel in coming months.

A ship passes an oil refinery off the coast of Singapore October ...
ship passes an oil refinery off the coast of Singapore October 17, 2008.(Vivek Prakash/Reuters)

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http://www.nytimes.com/2008/10/17/business/
worldbusiness/17oil.html?_r=1&hp&oref=slogin

Oil falls to 14-month low on bad US economic data: $71.64/Barrel

October 16, 2008

The good news is that the price of oil is down.  The bad news is that most suppliers are seeing falling demand and they have to get more cheep oil out to make sales goals….

By ALEX KENNEDY, Associated Press Writer

SINGAPORE – Oil prices fell to a 14-month low Thursday in Asia as bad U.S. economic news stoked fears that a significant global economic slowdown will undermine demand for crude.
Light, sweet crude for November delivery was down $2.90 to $71.64 a barrel in electronic trading on the New York Mercantile Exchange by midafternoon in Singapore. The contract fell overnight $4.09 to settle at $74.54, the lowest settlement price since Aug. 31, 2007.

Oil prices are now half of the peak they reached in July.

“The market is just very worried about a severe international economic downturn,” said David Moore, commodity strategist at Commonwealth Bank of Australia in Sydney. “They’re thinking that oil consumption will be weaker than expected.”

Investors were discouraged Wednesday by a U.S. Commerce Department report that showed retail sales dropped in September by 1.2 percent, a sign that turmoil in the credit markets has begun to slow consumer spending. Later in the day, the Beige Book, the assessment of business conditions from the Federal Reserve, said that the economy continued to slow in the early fall.

Japan’s benchmark Nikkei 225 stock average was down nearly 10 percent Thursday while the Dow Jones industrials plummeted 733 points Wednesday, or 7.9 percent, it’s second-largest point loss ever.

“If we’re in the grips of a severe downturn, it’s very hard to pick where things will bottom,” Moore said. “There’s the potential that bad economic news will continue to rattle markets.”

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http://news.yahoo.com/s/ap/20081016/ap_on_bi_ge/oil_
prices;_ylt=AsQzgl5dhz9fpKUSOz3kqjSs0NUE

Oil Below $72 Per Barrel

October 15, 2008

AFP

The price of oil slumped below 72 dollars on Wednesday, its lowest level for more than 13 months, as recession fears raised concerns about a prolonged drop in energy demand, analysts said.

The global financial crisis will give a vicious twist to an economic slowdown and is hitting world demand for oil, although the effect on emerging economies is unclear, OPEC said on Wednesday.

A motorist holds a fuel pump at a service station. Oil prices ...

The Organization of Petroleum Exporting Countries slashed its estimate of growth in demand this year and shaved its estimate for 2009, largely because of an “excessive” easing of demand in the United States, the single biggest energy market.

Prices also fell Wednesday on news that a Nigerian court has ordered Anglo-Dutch energy giant Royal Dutch Shell to hand over land to locals, a key demand of armed rebels camped in Nigeria’s oil-producing region.

Brent North Sea crude for November delivery fell to 71.60 dollars a barrel — the lowest level since August 2007 — before recovering to 72.41 dollars, down 2.12 dollars compared to Tuesday’s close.

New York’s main contract, light sweet crude for November, shed 1.98 dollars to 76.65 dollars.

Brent crude has fallen by more than half from a record high 147.50 dollars in July, when prices rocketed on fears of supply disruptions.

Oil prices are sliding on “concerns that the coordinated action by central banks over the last week will not be enough to rescue economies from falling into a global recession and hence weighing on oil demand,” Sucden analyst Nimit Khamar said.

 

A top US central banker, Janet Yellen, said Tuesday that the United States “appears to be in a recession.” There are also growing fears Japan and Europe are heading for a spell of economic stagnation or recession.

The German economy is heading for a slowdown but the downturn will not be a long-lasting one, Chancellor Angela Merkel said Wednesday.

Meanwhile a Nigerian court ordered Shell to hand over land around its giant Bonny oil terminal to the local population, the multi-national said Wednesday.

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http://www.breitbart.com/article.php?id=081015121543.ct10v95y&show_article=1

Perils in The Price Of Each Grain of Rice

April 3, 2008

By David Ignatius
The Washington Post
Thursday, April 3, 2008; Page A17

You may have missed the front-page article in the New York Times last Saturday, with the one-column headline written in clipped newspaperese: “High Rice Cost Creating Fears of Asia Unrest.” But this little story could be an early warning of another big economic problem that’s sneaking up on us.

The new danger is global inflation — most worryingly in food prices, but also in prices for commodities, raw materials and products that require petroleum energy, which includes almost everything. Prices for these goods have been skyrocketing in international markets — at the same time the Federal Reserve and other central banks have been hosing the world with new money in their efforts to avoid a financial crisis.

That’s an explosive mixture. It risks a kind of inflation that would trigger panic buying, hoarding and fears of mass political protest. Actually, this is already happening in Asia, according to the Times.

The price of rice in global markets has nearly doubled in the last three months, reports the Times’s Keith Bradsher.
.
Fearing shortages, some major rice producers — including Vietnam, India, Egypt and Cambodia — have sharply limited their rice exports so they can be sure they can feed their own people.

Bradsher summarizes the evidence that food shortages and inflation are fueling political unrest: “Since January, thousands of troops have been deployed in Pakistan to guard trucks carrying wheat and flour. Protests have erupted in Indonesia over soybean shortage, and China has put price controls on cooking oil, grain, meat, milk and eggs. Food riots have erupted in recent months in Guinea, Mauritania, Mexico, Morocco, Senegal, Uzbekistan and Yemen.”

World Bank President Robert Zoellick rang the alarm bell in a speech yesterday. He noted that since 2005, the prices of staples have risen 80 percent. The real price of rice rose to a 19-year high last month, he said, while the real price of wheat hit a 28-year high.

Zoellick warned that this inflation is having political repercussions: “The World Bank Group estimates that 33 countries around the world face potential political and social unrest because of the acute hike in food and energy prices.” To cope with the topsy-turvy economy, Zoellick made an innovative proposal that countries running a surplus, such as Saudi Arabia and China, devote 1 percent of their “sovereign wealth” funds to investment in Africa‘s poor countries. That could yield up to $30 billion in development spending.

Now, cut to the Federal Reserve. At a time when global inflation is raging, you might expect that the central bank’s first priority would be to dampen inflationary expectations in the United States. But because of its worries about a financial meltdown, the Fed has been doing the opposite — drastically cutting interest rates in an effort to unclog the financial markets. The cheap money didn’t stop the Wall Street bank run — it was the Fed’s bold plan to absorb subprime debt that did that — but it may well add fuel to the inflation fire.

Related:
Lowly Rice Grain Impacts Global Economy

Vietnam and India move to limit rice exports

Inflation and Food Shortages?

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http://www.washingtonpost.com/wp-dyn/content/article/2008/04/02/AR2008040202997.html?hpid=opinionsbox1