What Iran and Anna Nicole Smith Have in Common
What do Iran and Anna Nicole Smith have in common? Strange behavior, that's what.
Now the strange behavior we might see from Anna -- lovely girl, really -- is humorous. She's the kind of good-timing girl that would drink a dozen shots of Jagermeister, strip naked, cover herself in soap bubbles and hop down the street on a pogo stick, then wake up married to guy 63 years older than her! And I'm not speaking hypothetically. Still, it is to laugh. And I bet she's a lot of fun to hang out with. Those among us who have never dated a crazy woman can cast the first stone.
Iran's strange behavior worries me. My friend, commodity trader Kevin Kerr, recently pointed out to me that the Iranians have chartered a total of NINE Very Large Crude Carriers (VLCCs) to use as storage because of the difficulty in selling heavy crude. 18.4 million barrels in all.
Mind you, it's not like they MUST pump the oil -- it's fine sitting in the ground. In fact, it's good to give oil wells a rest now and then. So why go to the expense of pumping and storing crude oil you can't sell?
Iran is already pumping below their OPEC quota -- maybe it's a matter of saving face. But one thing it illustrates is how the world's refinery system is ill-equipped to handle heavy, sour crude. Refiners are now operating at 91.4% capacity -- the highest rate since last August, the week before Hurricane Katrina slammed into the Gulf of Mexico.
Now, let's say another hurricane hits the Gulf of Mexico hard (hurricane season started yesterday) -- and knocks out refineries that can handle heavy sour crude. Then we might have the crazy paradox of light sweet crude soaring and the price of heavy sour crude sinking.
Back to Iran -- more strange behavior. The civilized world has lined up to offer Iran a huge buffet of incentives to stop its nuclear program. But it seems like Iran is going to say "no" even though it's being offered EVERYTHING IT ASKED FOR. Man, I wish I had my own nuclear program if it will get me on this "goody giveaway" list.
So what's Iran's game? What do they really want? Why are they acting this way? These questions -- or perhaps the fact that there are no good answers -- could help drive oil over $80 a barrel.
Now the strange behavior we might see from Anna -- lovely girl, really -- is humorous. She's the kind of good-timing girl that would drink a dozen shots of Jagermeister, strip naked, cover herself in soap bubbles and hop down the street on a pogo stick, then wake up married to guy 63 years older than her! And I'm not speaking hypothetically. Still, it is to laugh. And I bet she's a lot of fun to hang out with. Those among us who have never dated a crazy woman can cast the first stone.
Iran's strange behavior worries me. My friend, commodity trader Kevin Kerr, recently pointed out to me that the Iranians have chartered a total of NINE Very Large Crude Carriers (VLCCs) to use as storage because of the difficulty in selling heavy crude. 18.4 million barrels in all.
Mind you, it's not like they MUST pump the oil -- it's fine sitting in the ground. In fact, it's good to give oil wells a rest now and then. So why go to the expense of pumping and storing crude oil you can't sell?
Iran is already pumping below their OPEC quota -- maybe it's a matter of saving face. But one thing it illustrates is how the world's refinery system is ill-equipped to handle heavy, sour crude. Refiners are now operating at 91.4% capacity -- the highest rate since last August, the week before Hurricane Katrina slammed into the Gulf of Mexico.
Now, let's say another hurricane hits the Gulf of Mexico hard (hurricane season started yesterday) -- and knocks out refineries that can handle heavy sour crude. Then we might have the crazy paradox of light sweet crude soaring and the price of heavy sour crude sinking.
Back to Iran -- more strange behavior. The civilized world has lined up to offer Iran a huge buffet of incentives to stop its nuclear program. But it seems like Iran is going to say "no" even though it's being offered EVERYTHING IT ASKED FOR. Man, I wish I had my own nuclear program if it will get me on this "goody giveaway" list.
So what's Iran's game? What do they really want? Why are they acting this way? These questions -- or perhaps the fact that there are no good answers -- could help drive oil over $80 a barrel.
Check out my new gold and energy blog at MoneyAndMarkets.com
posted by Sean Brodrick @ 10:52 AM
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