Mid-Week Oil Roundup

A Marketwatch reporter is using me as a source for a story on the upcoming OPEC meeting in Venezuela. True, I am not Venezuelan, or a member of OPEC, but I did write a piece called "The Axis of Oil," about the alliance of convenience that Iran and Venezuela find themselves in. Strange bedfellows indeed.

Anyway, my story popped up on the radar. Hence, I was called as an "expert." And I can always research. For instance, did you know that Sudan is being invited to join OPEC? Obviously, there's no "humanitarian" requirement for membership. Or how about that U.S Energy Secretary Sam Bodman says OPEC is "powerless" to lower oil prices.

"The Saudis say they have an extra 1 million barrels but I take that with a kind of a grain of salt," Bodman says.

Here are some other interesting stories on the subject ...

#1) The Saudi Oil Minister warns that global oil demand -- and oil prices -- could plummet if there is an economic slowdown.

http://tinyurl.com/kbtdd

One way to help the global economy would be to lower oil prices by increasing quotas (which, since the Saudis are the swing producer, means more revenues for the Saudis). Perhaps the Saudis and Venezuelans will be at loggerheads at the meeting in Venezuela.

#2) Alexander's Gas & Oil Connection gives good coverage of the IEA's reclassification of Venezuela's extra-heavy crude: http://tinyurl.com/h8paq


#3) The Venezuelas say they'll take 60% of those joint ventures in the Orinoco extra-heavy oil deposits, thank you very much. Such lovely people. Oil executives from Exxon, BP (which invented the Orimulsion process that makes Venezuela's extra-heavy crude currently commercially viable) Chevron and more are on a slow simmer, but what are they going to do?

http://tinyurl.com/gur85

#4) Your field guide to OPEC price hawks and price doves

http://tinyurl.com/zy9rv

#5) An interesting story from the IEA about the last time Venezuelan exports of oil to the US plummeted.

http://tinyurl.com/zy9rv

This time, amigo, there's no extra Mexican Maya crude to make up the difference.

#6) Late-breaking addition: I forgot to add that Venezuela is calling for OPEC production cuts (again!) and Chavez is talking about pricing oil in something other than dollars (euros?)

http://tinyurl.com/j2v8q

#7) And then there's the idea that Venezuela may be running out of conventional crude oil. Oh my!

One source reports that the world's fifth largest oil producer is showing signs of a rapid decrease in production, one of the key tenets of the peak oil theory ... Venezuela is buying oil from Russia in order to avoid defaulting on deliveries to clients. The situation raises serious questions about the country's oil production and the future of PDVSA as a major oil producer, and increases the risk to the U.S. oil supply should the country's oil production suddenly plummet.

http://tinyurl.com/p4thv

[XX Note: updated to add #7 and to change all the urls to tinyurls -- the long urls were messing up the page.]

I gave the reporter lots of quotes, but she'll probably use just a few. Se la vie.

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