[Peakoil] Oil Futures

[Alex P]

Like Keith says, insiders make their money this way. You have a popular
consensus and the insiders go along with it publicly, but behind the scenes
they take the opposite position.

The ultimate insider oil play was the invasion of Iraq, that is oil in the
bank for the US govt and the corporate interests it represents. Cheney has
known about Peak Oil since before becoming VP.

As with many things it pays to do the research yourself and not assume that
everyone else around you already has. The problem is, they will make the
same assumption, this is the "consensus trance"

There is lots of evidence that Peak Oil is upon us, an example is that Saudi
Arabia has been over-exploiting its major fields for decades esp Ghawar,
leaving oil behind in unreachable pockets. If they had alternative fields
they would have used them. Now they are claiming that fields moth-balled
during this time will make up the decline in Ghawar. It doesn't add up.
Saudi production is now reported to be in decline at 2% pa. I recommend
"Twilight in the Desert" by Matt Simmons.

There are a number of reasons for companies understating the risk of global
production declines, I think the main reason is that governments would start
aggresively nationalising and taxing oil fields.

Trying to say there will be a world production peak soon has been hard,
since there are producers, esp. unaudited state-owned producers (eg Saudi
Arabia) who can claim to make up the shortfall. Oil companies have promoted
the myth of growing resources by understating initial reserve sizes for tax
reasons. As time passes they announce reserve increases until it reaches
their original private estimates. It is contrary to the psychology of our
consumerist ways, saying, folks, there really is a limit. A lot of people,
including market players, just don't want to know.


Alex
O4O4873828

ACT Peak Oil
http://act-peakoil.org
 


On Sat, 12 Aug 2006 05:56:06 +1000, Keith Thomas <keith at evfit.com> wrote :

> On 11/08/2006, at 1:48 PM, Robert Wiblin wrote:
> 
> > I've just been looking at the oil futures market. If oil is really
> > likely to hit $100 or $200 soon, why are oil companies willing to
> > deliver oil for any times in the next five years for under $80? Surely
> > if anyone knows the details of the oil market it is the companies with
> > all of the inside information. Yet they seem confident enough to sell
> > you a barrel of oil now, but delivered in 2011, for around $70. Can
> > they really be so mislead about their own position and market?
> >
> > http://futures.tradingcharts.com/marketquotes/index.php3?market=CL
> >
> > If famous peak oilers really believe oil will be that high, why not
> > put their money out there and make a fortune when their oil arrives
> > and they can sell it for double?
> >
> > Interested to hear the response as I have been unable to answer this.
> >
> > -- 
> > Robert Wiblin
> > robertwiblin at gmail.com
> > Ph: 0401242877
> > Burgmann College, ANU
> 
> I'd guess this is how Matt Simmons made his millions. It's also my 
> guess that lots of others are doing the same. Considering the high oil 
> input in agricultural products, many will - for the same reason - be 
> investing in wheat (etc.) futures as well Do you have any evidence that 
> they are not?
> 
> Some peakists predict a degree of economic collapse; for these people 
> investing in any sort of futures for, say, 2011, is also betting on the 
> stability of the world economic system and the ability to enforce 
> contracts in 2011.
> 
> These are just my observations - interested to hear the views of 
> others: Alex? Antony? Leigh?
> --------------------------------------------
> Keith Thomas
> www.evfit.com
> --------------------------------------------
>