Saudi Arabia Shifts its Focus to China as the United States Falls Out of Favor
Saudi Arabia, the world's largest oil producer, last year shipped more oil to China than it did the United States for the first time ever – a shift that highlights China's ascension to the ranks of the world's economic elite, as well as its position as the new focal point for the world's energy producers.
The flow of oil from Saudi Arabia to China rose to more than 1 million barrels per day (bpd) last year, just as demand in the United States fell below that level for the first time in more than two decades.
China in December alone imported a record-high 1.2 million bpd of Saudi oil, as its economy rode the momentum of Beijing's $585 billion (2 trillion yuan) stimulus package. U.S. imports of Saudi oil, on the other hand, fell to a 22-year low of 998,000 bpd in the first 11 months of 2009, as the world's largest oil consumer clawed its way back from its worst recession in 70 years.
How to Profit as Wall Street Insiders Push Oil Prices Skyward
Most forecasts are calling for oil to edge up slowly over the next year. Or, that's what Wall Street wants you to believe anyway.The big Wall Street firms control millions of barrels of oil and can direct their clients' money into oil. Which way do you think they want oil to go? Find out how Wall Street can manipulate oil prices… and the one move to make now to profit right alongside the "big boys."
Ghana May Kill Exxon's $4 Billion Oil Deal
The government of Ghana may kill Exxon Mobile Corp.'s (NYSE: XOM) plans to buy a $4 billion stake in a giant offshore oil discovery from Kosmos Energy LLC. The move could help China expand its growing presence in the region through its state-owned oil company China National Offshore Oil Corp. (NYSE ADR: CEO).
Ghanaian Energy Minister Joe Oteng-Adjei sent a letter to Exxon last week informing the company that the government wouldn't approve the deal with Kosmos. The letter said the government is "unable to support an Exxon Mobil acquisition of Kosmos's Ghana assets," according to a copy reviewed by The Wall Street Journal.
The government said Dallas-based Kosmos had shared critical information about the field with potential buyers without its permission. Ghana also said Kosmos had left Ghana's state-run oil company, Ghana National Petroleum Corp. (GNPC) out of discussions held to determine how the field should be developed.
Oil Prices Set to Surge to $90 a Barrel by Midyear, Retest Record High in 2011
In its 2010 forecast series, Money Morning predicted the price of oil would reach $100 a barrel by the end of the year. And while crude prices stalled in January, a growing body of evidence suggests that call may not be far off.
Oil prices rose above $80 a barrel for the first time ever on Sept. 13, 2007. From there they jumped 84% to $147 a barrel in July 2008. Then, in 2009, they surged more than 133% from a low of $34.03 a barrel in February to $79.39 a barrel at the end of December.
The price of crude again topped out above the $80 a barrel mark in early January, but has since slid back down to about $75 a barrel. However, some analysts believe that this is just period of temporary cooling before prices reignite and soar to $90 by midyear, and as high as $200 a barrel by 2012.
Will China Supersede Saudi Arabia as the Key to U.S. Oil Prices?
I bought a Toyota Prius last Saturday.
The signs are everywhere that oil is headed for stratospheric highs – $200, $250 or even $300 a barrel. Some of these signs are just plain obvious. But even the subtle indicators are telling us that some very expensive energy costs headed our way.
Let me tell you about one such indicator that I came across over the New Year holiday. A tiny news item said that Saudi Arabian oil concern Aramco is abandoning a lease on Caribbean oil storage, and further reported that PetroChina Co. Ltd. (NYSE ADR: PTR) is moving in to take Aramco's place.
Most investors here in the West – if they even read the item – would've dismissed it as just another minor business transaction, one among the thousands that take place each day. But this particular deal was much more than that. It's another indication of China's continued global emergence. And it also underscores this country's relegation to the growing legion of "former" world powers that have been eviscerated by the financial crisis that they created.
In case you missed the story, let me share the details, and then explain what I believe those details actually mean.
Wall Street Scrambles its "Contango Convoy" to Capitalize on Higher Oil Demand
A 26-mile-long line of idled oil tankers, enough to blockade the English Channel, are firing up their engines and jockeying for position in a race to cash in on the bone-chilling deep-freeze plaguing the North America, Europe, and Asia.
The supertankers, each of which can hold over 2 million barrels of oil, are steaming "all ahead full" to deliver their stores of crude, heating oil and other distillates to the United States.
Their clients – which include several huge Wall Street investment firms – are eager to unwind what's become known as the oil storage trade.
The New Oil Index is About to Create Even More Opportunity for Investors
Speculators in New York won't be calling the shots anymore. Not in oil, anyway.
The way we price it. The places we trade it. The companies that stand to profit most.
It's all about to change.
This was confirmed at a meeting I just attended in The City, London's financial district. I arrived from Moscow's Domodedovo Airport for an unusual Saturday morning gathering of bankers, traders and analysts called only days before.
The subject? A new oil-pricing index.
This is huge.
More oil-project funding is raised within a three-mile radius of The City's Liverpool Street train station than anywhere else on Earth. And now they're preparing to control the oil trade, as well.
This will create all kinds of new ways to make money in oil. Not just with fancy financial instruments designed for the "big boys," but with retail investments, too. So there's money in this for you.
How to Profit From the Oil-Price Spike of 2010
Oil prices staged a remarkable rally this year on the back of a weak dollar and a nascent economic recovery. In 2010, it's likely that these same factors will combine with an increase in global energy demand to push oil prices back up over $100 a barrel.
With stockpiles still high and energy demand rebounding sluggishly, most forecasts are calling for the "black gold" to edge up into the low-triple-digit price range. That's 40% higher than where oil is trading right now – but is still well below the record high of nearly $150 a barrel that was established in 2008.
Money Morning Chief Investment Strategist Keith Fitz-Gerald is even more bullish. He believes that a price of $100 a barrel is "easily attainable" and says that some sort of unforeseen market shock could cause crude oil to spike as high as $150 barrel by the end of 2010.
New "Profit Routes" Emerge in Oil – Reporting from Moscow
MOSCOW - Sergei Kudryashov likes pizza, poker and American jazz. He's also deputy head of the Russian Ministry of Energy (Minenergo) and former VP at NK Rosneft OAO (LSE: ROSN), the No. 1 state-controlled oil producer.
I've known Sergei for almost two decades now. We compare notes whenever I'm in Moscow. This time, I briefed his team on key developments in the international oil markets. And, as usual, I came away from the meetings with some incredibly valuable information – information the public simply can't get on its own.
So let me share what I've just learned. It's a tremendous opportunity to profit from Russian oil – without investing a dime in the country itself. Indeed, as you'll see in a minute, there are several ways to make money right here at home.
First, here's what's going on.
If U.S. Oil Companies Aren't Winning Bids in Iraq, Who Is?
Iraq has auctioned off more proven oil reserves in the past six months than are collectively held by the United States, Mexico, and the United Kingdom.
But U.S. oil companies have signed surprisingly few development contracts – and foreign rivals have swooped in to scoop up major deals.
Take last weekend, when Iraq wrapped up the biggest oil-field auction in history. Major new deals were announced by Europe's Royal Dutch Shell PLC (NYSE: RDS.A , RDS.B), OAO Gazprom (OTC ADR: OGZPY), Lukoil (OTC ADR: LUKOY), China's China National Petroleum Corp. (CNPC), and Malaysia's Petroliam Nasional Berhad (Petronas).