Re: [A-List] (no subject)

[Andre Gunder Frank <franka@xxxxxxx>]

actually OPEC has never been able to buck the market and hardly ever
been able to keep its act together, least of all in a
declining/recessionary market, and I see no good reason to suppose that
the sun will this time set in the east/rise in the west. besides, OPEC
supplkies only about 40% of the market and  as
 this keeps insisting  the russians are bully on the block, even if you
all contend that their output/power is waning.
gunder


On Sat, 29 Dec 2001, Mark Jones wrote:

> Date: Sat, 29 Dec 2001 10:03:53 +0000
> From: Mark Jones <mark.jones@xxxxxxxxxxxxx>
> Reply-To: a-list@xxxxxxxxxxxxxxxxxxx
> To: A-List <a-list@xxxxxxxxxxxxxxxxxxx>
> Subject: [A-List] (no subject)
>
> [the significance of this, if it happens, will be that this is the first
> time Opec have managed to sustain the integrity of the cartel and its
> armlock on the energy market *during a recession*. For those of us who are
> doomsayers about oil, this represents a crucial turning point. For the
> first time, the decline of world oil has accelerated faster than the
> decline in output during a major recession, thus portending an era of
> higher oil prices under almost any circumstances, and a vicious descending
> spiral of economic decline. Time will tell. Mark]
>
> FT: Opec to cut output by 1.5m b/d from January 1
> By Heba Saleh in Cairo
> Published: December 28 2001 18:20 | Last Updated: December 29 2001 00:52
>
> Opec ministers on Friday agreed to cut world oil supply by 1.5m b/d for six
> months starting next week after the cartel secured the unprecedented
> agreement of five non-Opec rivals to trim their own production by 462,500 b/d.
> Brent prices in London strengthened on the widely expected announcement by
> 54 cents on Friday to trade at $20.88, before closing down 4 cents at
> $20.30. On Nymex, crude closed down 49 cents at $20.41.
> Analysts said the size of the reductions and the pact between Opec and
> non-Opec producers represented a strong message to markets.
> "The whole idea is to tell markets that Opec and non-Opec producers are
> serious. They do not like prices to be too low," said Robert Mabro director
> of the Oxford Institute for Global Energy Studies.
> Opec is aiming to lift prices as near as possible to its preferred range of
> $22 -$28, equivalent to about $24 to $30 for Brent.
> "In normal times we aim for $22-$28 but particularly after September 11 we
> have to take account of the global economic downturn and its impact on
> demand," said Opec Secretary General, Ali Rodriguez.
> The cut is Opec's fourth in a year bringing down the cartel's production to
> 21.7 million b/d. In total, the cartel has trimmed supply by 19 percent or
> 5 million b/d.
> This time, however, Opec made its cut conditional on reductions by non-Opec
> producers. After some initial resistance, Russia, Mexico, Norway, Oman and
> Angola agreed, spurred on by prices which had dipped to 17 dollars.
> "They are all in the same boat. They need the cash," said Mr Mabro.
> Nonetheless, as ever there is no guarantee that producers both within or
> outside the cartel will abide by the new quotas. "They usually do not
> adhere 100 percent," said Mohammed Ali Zainy, a senior economist at the
> Centre for Global Energy Studies."The end result [ for Opec production]
> might be a cutback of 800,000 b/d."
> The centre expects crude prices to be at around $19 dollars for the first
> quarter rising to $22 in the second quarter.
> In an effort to set a good example, Opec heavyweight and the world's
> largest oil producer, Saudi Arabia, said it was lowering crude sales
> immediately. Iran and the United Arab Emirates are quoted as saying they
> would do their best to follow suit.
> However in recent months, Nigeria, a cartel member, has accounted by itself
> for half of Opec's overproduction. The West African country has been
> exceeding its quota by 300,000 b/d.
> Analysts say non-Opec Mexico and Norway have good records of respecting
> their commitments to the cartel. Overall, however, Mr Zaini said the
> compliance of non-Opec producers would be "tenuous at best."
> A particular concern for Opec is Russian compliance. The country has
> pledged a 150,000 b/d cutback for the 1st quarter of next year. Some
> analysts are sceptical that this is no more than Russia's traditional
> winter cutback and that come the spring production will rise again.
> Also some Russian private sector producers have made clear they would try
> to get around the restrictions by increased exports of refined oil products.
> Mr Rodriguez and the incoming Opec President Rilwanu Lukman are travelling
> to Russia in January where they are expected to try to convince the
> government to extend the cutbacks until the end of the second quarter.
>
> from FT.com
>
>
>
>




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                    ANDRE  GUNDER  FRANK
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