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Transocean Ltd. Message Board

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  • flashdlc1945 flashdlc1945 Nov 13, 2007 3:45 PM Flag

    Saudis won't consider Oil Production Increase

    hemano8, One must take into consideration that OPEC does not want crude prices to be too high too long as high crude prices will encourage oil consuming nations to develop alternate energy sources. OPEC wants us to continue our addiction to oil. In short, deep water oil drillers are an excellent long term investment.

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    • I agree - the Saudis don't want oil over $100 which is why they are pumping at full capacity now. Boone says Saudis have no available capacity left to bring on-line. Doesn't mean crude can't trade lower but if demand stays at current levels the price will continue to rise.

      • 3 Replies to heman08
      • Agree completely. I've been arguing for a couple of years now that Saudi has pretty much maxed out it's production. If nothing else, their ports can only handle so many ships. I think there are so many reasons to suggest that Saudi is pretty much at its peak. And even if it isn't, we do know that Mexico's GoM output is falling; Russia renegotiating; Chavez is crazy; oil may fall in price, but it is certainly going to stay in the $75 - $90 range, and "we" can make a lot of money on oil in that range.

      • Yeah and those brain surgeons calling for a recession got a kick in the ass today. 3rd qtr GDP is being revised up from 3.9 to 5%. Newsflash for you bears: you don't go into a recession with a 5% growth rate. Morons.

      • Dr. Stephen Leeb, among other "peak oil" theorists, believes that OPEC in general, and the Saudis in particular, have been overstating their reserves for years, primarily because the percentage of oil each OPEC member is permitted to export is tied to each member's announced reserves. In fact, Leeb and others think OPEC reserves are past their peak and dropping, which they assert explains why OPEC has generally been unable to substantially ramp up production in times like these.

        Even if you think Leeb, et al., are overstating their case (and I'm not sure they are), the reality is that unless we are going to let the price of oil skyrocket out of control, the biggest reserves in the world are going to need to be brought online damn soon, and all of those fields are under a lot of water, such as Chevron's Jack field in the Gulf of Mexico and the fields off Nigeria. Good time to own RIG, I'd say, as well as a Canadian tar sands play or two.

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