Best of the Week
Most Popular
1. 2019 From A Fourth Turning Perspective - James_Quinn
2.Beware the Young Stocks Bear Market! - Zeal_LLC
3.Safe Havens are Surging. What this Means for Stocks 2019 - Troy_Bombardia
4.Most Popular Financial Markets Analysis of 2018 - Trump and BrExit Chaos Dominate - Nadeem_Walayat
5.January 2019 Financial Markets Analysis and Forecasts - Nadeem_Walayat
6.Silver Price Trend Analysis 2019 - Nadeem_Walayat
7.Why 90% of Traders Lose - Nadeem_Walayat
8.What to do With Your Money in a Stocks Bear Market - Stephen_McBride
9.Stock Market What to Expect in the First 3~5 Months of 2019 - Chris_Vermeulen
10.China, Global Economy has Tipped over: The Surging Dollar and the Rallying Yen - FXCOT
Last 7 days
Semiconductor Sector – Watch the Early Bird in 2019 - 21st Jan 19
From ASEAN Economic Development to Militarization - 21st Jan 19
Will China Surprise The Us Stock Market? - 21st Jan 19
Tips to Keep Your Finances Healthy in 2019 and Beyond - 21st Jan 19
Tips for Writing Assignment in Hurry - 21st Jan 19
UK House Prices, Immigration, and Population Growth Mega Trend Forecast - 21st Jan 19
REMAIN Parliament to Subvert BrExit with Peoples Vote FIXED 2nd EU Referendum - 21st Jan 19
Pay Attention To The Russell Stocks Index and Financial Sectors - 20th Jan 19
Hyperinflation - Zimbabwe's Monetary Death Spiral - 20th Jan 19
Stock Market Counter-trend Extends - 20th Jan 19
The News About Fake News Is Fake - 20th Jan 19
Stock Market Bull Trap? January 22 Top Likely - 19th Jan 19
After the Crash, the Stock Market Made a V-shaped Recovery. What’s Next - 19th Jan 19
David Morgan: Expect Stagflation and Silver Outperformance in 2019 - 19th Jan 19
Why Brampton Manor Academy State School 41 Oxbridge Offers is Nothing to Celebrate! - 19th Jan 19
REMAIN Parliament Prepares to Subvert BrExit with Peoples Vote FIXED 2nd EU Referendum - 19th Jan 19
Gold Surges on Stock Selloff - 18th Jan 19
Crude Oil Price Will Find Strong Resistance Between $52~55 - 18th Jan 19
Stock Market’s Medium Term is No Longer Bullish. It is Now Mixed - 18th Jan 19
SPX and Gold; Pivotal Points at Hand - 18th Jan 19
Fable Media Launches New GoWin Online Casino Affiliate Site in UK - 18th Jan 19
The End of Apple! - 18th Jan 19
Debt, Division, Dysfunction, and the March to National Bankruptcy - 18th Jan 19
Creating the Best Office Space - 18th Jan 19
S&P 500 at Resistance Level, Downward Correction Ahead? - 17th Jan 19
Mauldin: My 2019 Economic Outlook - 17th Jan 19
Macro Could Weaken After US Government Shutdown. What This Means for Stocks - 17th Jan 19
US Stock Market Indexes Reaches Fibonacci Target Zone – Where to Next? - 17th Jan 19
How 2018 Was For The UK Casino Industry - 17th Jan 19
Gold Price – US$700 Or US$7000? - 16th Jan 19
Commodities Are the Right Story for 2019 - 16th Jan 19
Bitcoin Price Wavers - 15th Jan 19
History Shows That “Disruptor Stocks” Will Make You the Most Money in a Bear Market - 15th Jan 19
What Will the Stock Market Do Around Earnings Season - 15th Jan 19
2018-2019 Pop Goes The Debt Bubble - 15th Jan 19
Are Global Stock Markets About To Rally 10 Percent? - 15th Jan 19
Here's something to make you money in 2019 - 15th Jan 19
Theresa May to Lose by Over 200 Votes as Remain MP's Plot Subverting Brexit - 15th Jan 19
Europe is Burning - 14th Jan 19
S&P 500 Bounces Off 2,600, Downward Reversal? - 14th Jan 19
Gold A Rally or a Bull Market? - 14th Jan 19
Gold Stocks, Dollar and Oil Cycle Moves to Profit from in 2019 - 14th Jan 19
How To Profit From The Death Of Las Vegas - 14th Jan 19
Real Reason for Land Rover Crisis is Poor Quality of Build - 14th Jan 19
Stock Market Looking Toppy! - 13th Jan 19
Liquidity, Money Supply, and Insolvency - 13th Jan 19
Top Ten Trends Lead to Gold Price - 13th Jan 19
Silver: A Long Term Perspective - 13th Jan 19
Trump's Impeachment? Watch the Stock Market - 12th Jan 19
Big Silver Move Foreshadowed as Industrial Panic Looms - 12th Jan 19
Gold GDXJ Upside Bests GDX - 12th Jan 19
Devastating Investment Losses Are Coming: What Is Your Advisor Doing About It? - 12th Jan 19
Things to do Before Choosing the Right Credit Card - 12th Jan 19
Japanese Yen Outlook In 2019 - 11th Jan 19
Yield curve suggests that US Recession is near: Trading Setups - 11th Jan 19

Market Oracle FREE Newsletter

UK House Prices, Immigration, and Population Growth Trend Forecast

Saudi Arabia Hires Super Tankers to Flood U.S. With Oil for Election Year

Politics / Crude Oil Mar 21, 2012 - 01:48 AM GMT

By: Mike_Shedlock

Politics

Best Financial Markets Analysis Article... Oil Minister Says "High Oil Prices Unjustified"; Highest March Price in History; Republicans Say Obama Not Doing Enough

Wall of Supertankers Heads For US

Brent crude at $125, US Crude at $110, and soaring gasoline prices everywhere have caused quite a stir. See Highest Price Ever of Gasoline in March; State-by-State Gas Price and Gas Tax Comparison for a discussion.


In response to high prices, Saudi Arabia has a plan to send a wall of supertankers to the U.S. to knock down prices and Republicans have attacked President Obama for not doing enough.

Please consider The price that launched a wall of ships

In a matter of days, Saudi Arabia has hired the largest number of super-tankers in years. When the tankers load their cargo in Ras Tanura, the world's largest oil terminal, in the next couple of weeks and start a 40-day voyage towards the US Gulf coast, they will deliver a wall of oil with a single aim: to bring prices down.

"This is the first time in several years for [Saudi Arabia] to hit the market with such volume - and in such a short time frame," says Omar Nokta, a shipping expert at specialist investment bank Dalham Rose & Co.

Last week, Vela, the shipping arm of Saudi Aramco, hired over a few days 11 so-called very large crude oil carriers, each capable of shipping 2m barrels, to deliver to US-based refiners. "In 2011, Vela fixed one VLCC to the US every other month," Mr Nokta says.

The hiring spree was the most public move by the kingdom in a series of efforts aimed at bringing down oil prices from $125 a barrel towards $100. "They want to bring prices down. That is it," says a former Western oil official.

Saudi Oil Minister Says "High Oil Prices Unjustified"

Please consider Naimi calls high oil prices 'unjustified'

Saudi Arabia's powerful oil minister Ali Naimi sought to cool overheating oil markets on Tuesday, saying high oil prices were "unjustified" and that the kingdom could boost its output by as much as 25 per cent if necessary.

Supply was much more robust than it had been in 2008 when crude rose to $147 a barrel, he said.

As the west's nuclear stand-off with Iran escalates, oil prices have rallied this month to a post-2008 peak of $128 a barrel with markets bracing for European Union sanctions on Iranian crude that could knock out a chunk of global supply. Jitters have been fuelled by supply outages in Syria, Yemen and South Sudan.

High quality global journalism requires investment.

Christine Lagarde, managing director of the International Monetary Fund, said on Tuesday that rising energy prices had now overtaken Europe's sovereign debt crisis as the biggest worry for the global economy. Speaking in New Delhi, she said that while the world financial system had strengthened over the past three months, volatile oil prices would have "serious consequences".

But Mr Naimi insisted that supply was "much more firm today than in 2008", the time of the last big oil increase. Saudi Arabia had 2.5m b/d of additional production capacity, which it could bring online if necessary.

Saudi Arabia is likely to be producing about 9.9m b/d of oil in April and exporting roughly 7.5m-8m b/d of that, he said. Asked if the kingdom could ease prices by exporting more oil, he said customers were not asking for additional crude. "We are ready and willing to put more oil on the market, but you need a buyer," he said.

Republicans Say Obama Not Doing Enough

MarketWatch reports Republicans launch new attacks on Obama, Chu over gas prices

Republicans launched fresh attacks on the Obama administration on Tuesday over the soaring price of gasoline, ripping the White House in an election-year bid for the upper hand with consumers.

Testifying before the House Oversight and Government Reform Committee, Energy Secretary Steven Chu was peppered with questions about what the administration has done to bring down gasoline prices, which are now averaging $3.85 a gallon versus $3.55 a gallon a year ago.

Republican presidential candidates Mitt Romney and Newt Gingrich have called for Chu to be fired as gasoline prices climb. On Tuesday, Gingrich released an ad highlighting Chu's September 2008 statement (retracted since he became head of the Energy Department) that he'd like to see gasoline prices at similar levels to Europe's and his support for the Chevrolet Volt.

Gingrich -- who competes against Romney, Rick Santorum and Ron Paul on Tuesday in the Illinois Republican primary -- has touted a plan to bring gasoline prices down to $2.50 a gallon if elected president. The White House has criticized that plan as unrealistic.

Obama has said that there's little that can be done from Washington in the short term to lower gasoline prices and that there's no "silver bullet" to bring them down in a global market.

Warmongering Fools

Obama is essentially correct when he says "no silver bullet" on energy prices. Moreover, Gingrich is a fool if he really believes he can bring prices down that low without other devastating consequences such as a massive recession and 13% unemployment.

Finally, the leading Republican warmongers are angling for war with Iran, something sure to send oil prices to new highs should it happen. With $trillion deficits as far as the eye can see, the last thing the US needs to do is start another idiotic war, one likely to cause a supply shock sending gasoline prices over $5 if not much higher.

If you want a good reason for high gas prices, you can blame six things

  1. Fed policies - The Fed and its supporters in both political parties are to blame
  2. Fractional Reserve Lending - The Fed is to blame
  3. US Policy in the Mideast - Republicans other than Ron Paul will make matters worse
  4. Deficit spending - both political parties are to blame
  5. Warmongering - both political parties are to blame
  6. Peak Oil

Drill Baby Drill is an inane response to those fundamental problems.

By Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com Click Here To Scroll Thru My Recent Post List

Mike Shedlock / Mish is a registered investment advisor representative for SitkaPacific Capital Management . Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction.

Visit Sitka Pacific's Account Management Page to learn more about wealth management and capital preservation strategies of Sitka Pacific.

I do weekly podcasts every Thursday on HoweStreet and a brief 7 minute segment on Saturday on CKNW AM 980 in Vancouver.

When not writing about stocks or the economy I spends a great deal of time on photography and in the garden. I have over 80 magazine and book cover credits. Some of my Wisconsin and gardening images can be seen at MichaelShedlock.com .

© 2012 Mike Shedlock, All Rights Reserved.


© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

Andrew McKillop
21 Mar 12, 08:22
Saudi oil capers

Relating to this:

Last week, Vela, the shipping arm of Saudi Aramco, hired over a few days 11 so-called very large crude oil carriers, each capable of shipping 2m barrels, to deliver to US-based refiners. "In 2011, Vela fixed one VLCC to the US every other month," Mr Nokta says.

11 x 2 million barrels = 22 million barrels

This volume of oil is equal to a little more than 1 day of US oil consumption and about 2.33 days of oil imports.

As noted in the article, the VLCC take about 40 days to reach the USA. With the return trip, we cannot credibly expect Saudi Arabia to deliver a siginficantly large additional volume of crude, to the USA


Mark Sivad
21 Mar 12, 09:41
Refining is the problem

You can send as much crude oil to the US as you want, but the bottleneck is the limited refining capacity.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules