George owes Prince Bandar a rimjob ...

[xpanda]

This is a real shocker, kids. Out of left field, this is. Who'da thunk it? Surprise surprise.

blah blah blah.

___________

Crude Settles Just Shy of $50; Saudis to Hike Capacity
Tuesday, September 28, 2004

LONDON*CENSOR*—*CENSOR*Oil prices settleed just below the*CENSOR*$50-per-barrel mark in New York Tuesday, retreating from the $50.47 high reached in overnight electronic trade, after a Saudi Arabian oil official said it would raise its production capacity by nearly 5 percent.

Crude for November delivery last traded at $49.88, up 24 cents on the*CENSOR*New York Mercantile Exchange (search),*CENSOR* after slipping as low as $49.55. The session high was $50.20. Resistance was still seen at $51 and then $53, with support at $49.40.

"We played cat and mouse with $50 here today...prices could not push any higher with the weekly stats still due out on Wednesday," said a NYMEX floor trader.

Analysts said instability in the Middle East, political unrest in Nigeria, Africa's top oil exporter, and damage to U.S. production from the Caribbean's hurricanes were keeping traders on edge about world supplies. Some said the price may not be sustainable and may soon fall.

In response to the increase, Saudi Arabia announced it will raise its oil production capacity from 10.5 million barrels a day to 11 million barrels in order to "stabilize" prices. It is currently producing about 9.5 million barrels a day.

By increasing capacity, Saudi Arabia will be able to raise production when it wants. A Saudi oil ministry official, speaking on condition of anonymity, said that the kingdom would increase production "depending on demand."


The capacity increase by the world's largest oil exporter will go into effect within weeks, using new fields where production has just begun, Oil Minister Ali Naimi said.

"The fields of Abu Safa and al-Qatif, which have just started production, will be used to increase the kingdom's production capacity in the coming few weeks to 11 million barrels per day," the minister said in a statement.

"In light of the recent developments in the oil market and the increase in prices that exceeded $50 ... Saudi Arabia is closely monitoring the various developments in the international oil market and is working on stabilizing that," he said.

Naimi added that the increase was meant to control "prices so that they will not harm international economic growth." [HA!]

http://www.foxnews.com/story/0,2933,133763,00.html

 

[xpanda]

Just in case y'all forgot:

Did Saudis assure Bush on oil prices?
Report says prince pledged re-election support


By John W. Schoen
Senior Producer
MSNBC
Updated: 5:58 p.m. ET April 19, 2004

The White House Monday declined to comment on a report in a new book by journalist Bob Woodward that a Saudi Arabian ambassador had promised the Bush administration that it would lower oil prices to help boost the U.S. economy in time for the November presidential election.

In an interview that aired Sunday on CBS, Woodward, a Washington Post editor, said that Saudi Arabia's ambassador to the United States, Prince Bandar bin Sultan, had promised President Bush that the Saudis would cut oil prices before November to ensure the U.S. economy was strong on election day. *CENSOR*Woodward is the author of the new book "Plan of Attack" on Bush's preparations for the Iraq war.

It wouldn’t be the first time Saudi Arabia has used oil as a political or diplomatic weapon, most notably during the embargoes of the 1970s that brought gasoline rationing in the U.S. More recently, the Saudis increased production to ease oil prices at the start of the Gulf War in 1990 to support the first Bush administration in its effort to turn back Iraq’s invasion of Kuwait.

http://www.msnbc.msn.com/id/4779686/

 

[Shotgun]

Hmmm....oil was around $35 a barrell in April. Now it is $50. I'm not that good at government math, but when I see the price of oil going from $35 to $50 I don't look at that as being a price cut.

 

[xpanda]

Ummm ... the decision to hike production, and subsequently reduce prices, was handed down today. Not sure what your argument is.

 

[Shotgun]

Had Woodward been correct, Bandar would have increased production long ago in order to impact the election. Cheaper oil won't do much for the economy with only 30 days left before the election.

Bandar better do something...if $50 oil stays ANWAR is going to open up and the world economic slowdown will lower demand.

 

[xpanda]

I don't think the idea here is to actually have an impact on the economy, but to give the impression that falling oil and gas prices will eventually have a positive effect on the economy. There is no reason to believe, at this time, they won't scale back production shortly after the election.

The Bush team's economic talking points always point to the "around the corner", with fluffy economic 'indicators' used as justification for these points. Sometimes they're true, but thus far most have just been spin. Why should this not be used any differently? This gov't, in my fück-they-scare-me view, is more concerned with mobilising the masses than they are with pleasing them.

We'll see, of course.