Sunday, December 7, 2008

CBS: The Oil Kingdom

Part 1 - 12:33


Part 2 - 11:30

Posted by at 7:50 PM

7 comments:

Anonymous said...

Seeing that boarding room, controling every detail on every drop of oil everywhere in the world, is sugesting strongly that this marked is COMPLETLY managed

How aboud the intrinsic value paying for oil... more $ = higher prices....?

Shanti

December 8, 2008 at 12:57 AM
FOFOA said...

Hi Shanti,

Yes, it is amazing that they have so much control over their massive business. But I don't think that control goes beyond the borders of Saudi Arabia. That's not to say the market isn't "managed". Perhaps it is managed from outside of Saudi Arabia. I found this recent quote from Deepcaster interesting:

"Compare the Chart of Crude Oil Prices from the mid-summer, 2008 highs to December, 2008. The curve reflecting the price drop from $147 to the low $40s reflects a remarkably smooth descent and rate of descent, with only one modest bump up in September.

But the charts of the prices of virtually every other commodity and financial investments are quite choppy, reflecting the violent volatility of this period.

And if those statisticians among our readers chart the currency-adjusted price of Crude during that period, the curve is even smoother, that is, it is a curve which no free market action created.

Indeed, it is a curve which has a very high “regression analysis fidelity.” Thus it is highly probable that curve was created by The Cartel’s “computer management algorithm” as it daily deploys a chunk of the over $12 trillion in OTC Derivatives (cf. BIS, Table 19) devoted to daily control the Crude Oil price."

I think there is a battle raging beneath the surface, where we cannot see, between those that produce oil, and those that produce dollars. Remember, the oil kingdom wants to exchange it's excess dollars for real gold. But at $44 a barrel, there are no excess dollars to spend.

FOFOA

December 8, 2008 at 10:51 AM
YANKY DOODLE said...

Where is the text with Dubai 1990 and now ?!
Because you said Dubai & Oil, actually only 5% of Dubai revenues are from oil. The gross revenue is by trade/hub (harbour).

December 15, 2008 at 9:14 PM
FOFOA said...

Are you asking about this post?

December 15, 2008 at 9:54 PM
YANKY DOODLE said...

Yes in the comment section you wrote :
FOFOA said...
That's a good question. I don't know, but let's speculate. What do we know?

Dubai sprang up from the desert because of the wealth of oil in the region.

** I ask you, did Dubai sprang up from the desert because of oil ?! Because when I look at http://en.wikipedia.org/wiki/Dubai it says : Dubai's gross domestic product as of 2005 was US$37 billion.[9] Although Dubai's economy was built on the back of the oil industry,[66] revenues from oil and natural gas currently account for less than 6% of the emirate's revenues.[8] It is estimated that Dubai produces 240,000 barrels of oil a day and substantial quantities of gas from offshore fields. The emirate's share in UAE's gas revenues is about 2%. Dubai's oil reserves have diminished significantly and are expected to be exhausted in 20 years.[67] Real Estate and Construction (22.6%),[10] Trade (16%), entrepôt (15%) and financial services (11%) are the largest contributors to Dubai's economy. [68] Dubai's top re-exporting countries include Iran (US$ 790 million), India (US$ 204 million) and Saudi Arabia (US$ 194 million). The emirate's top importing countries are Japan (US$ 1.5 billion), China (US$ 1.4 billion) and the United States (US$ 1.4 billion).[7]

Historically, Dubai and its twin across the Dubai creek, Deira (independent of Dubai City at that time), became important ports of call for Western manufacturers. Most of the new city's banking and financial centres were headquartered in the port area. Dubai maintained its importance as a trade route through the 1970s and 1980s. Dubai has a free trade in gold and until the 1990s, was the hub of a "brisk smuggling trade"[69] of gold ingots to India, where gold import was restricted.

// So the biggest REVENUES (50%+) ARE FROM :
Real Estate and Construction (22.6%),[10] Trade (16%), entrepôt (15%) and financial services (11%) are the largest contributors to Dubai's economy. and NOT oil ?!

December 16, 2008 at 7:24 PM
FOFOA said...

I agree with all of that. My statement was based on a very long view. All that prosperity would not be possible were it not for oil in the beginning. I see Dubai as a kind of diversification for the Middle East. I think I said somewhere that Dubai is like Oil's younger brother, gone out to find his own path in life.

I don't quite understand your point. Does it have to do with the CBS video?

December 16, 2008 at 7:35 PM
tcelfer said...

"By the way.. nothing gets jammed down _our_ throats" <-- I loved this comment. Watching it seemed to me like he had a certain arrogance in that statement. The most 'baller' part of his interview. Mindset doesn't surprise me.

"I can assure you that price was the least on our mind. I say that in all honesty" <-- I realize that he says, blatantly, 'in all honesty', but for some reason this statement struck me as probably being the only honest thing that he said during the interview. Such conviction. It was, and maybe I'm just being crazy... but it seemed like the first time during the interview where he let his guard down and spoke with truth and honesty. I don't necessarily think that he was being dishonest at other times but certainly feel that those answers were well planned out -- while this somewhat caught him off guard. Perhaps I'm imagining it, but to me this answer just seemed different than his others. I have no doubt that price was the least of their concern -- they just want teh precious.

Almost done with 2008!! 2009 awaits!

Thanks again for all you do FOFOA.

October 25, 2013 at 2:00 PM

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