278 comments on DrumBeat: November 5, 2007
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278 comments on DrumBeat: November 5, 2007
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Some articles have Pemex saying their oil wells were not affected. Not sure how that can be, when 80% of Tabasco was underwater.
Other articles phrase it as, "they don't know if any of their wells are affected," which makes a little more sense.
Yes...this is a tad odd.
Oil is down as well today...expected at least a small movement up, given that no one truly knows the impact yet...ie. uncertainity.
But, nope...down 1.90 at the moment.
Does this mean they are going to be doubly surprized by this wednesday's weekly petroleum report?
The last two weeks have followed a pattern of oil dropping prior to the Wednesday report (oil dropped Tuesday the previous two weeks) - as much as $3-4, and then roaring back to higher highs following the "surprising" Wednesday report.
I don't get why it's a surprise, however. Robert has essentially told us flat out that the refineries will draw their inventories as much as possible in order to wait out these high prices, so why would anyone be surprised when we see another 3-5 mb draw this Wed? But, I am predicting oil will close above $100 on Wed due to this sort of dynamic.
Agree...this wednesday looks good to break that barrier.
Especially with $5 swings.
We will see.
This is profit taking time. In a few days prices will be up again.
Traders are focused on the dollar at the moment, not the inventory report. In trading terms, Wednesday's inventory report is far far far away. Bloomberg headlines quoted Mishkin of the Fed saying that the recent rate cut could be reversed if it turns out that it wasn't needed (this is b.s., but he's fighting to slow down the decline of the dollar). Plus, the dollar's recent descent was very rapid, and some amount of a rally has been widely expected. We saw the dollar come back a little bit today: http://quotes.ino.com/chart/?s=NYBOT_DX
Tell me if I'm out to lunch here, but having watched oil at >$90 the past two weeks and fall on Tuesday ahead of the inventory report, it seems like there's some fear and uncertainty that arrives just before the report comes out that maybe it will show a decent build, and thus people get out of their oil positions on Tuesday. Any truth in that, do you think?
You are not out to lunch. There is also a lot of poker in very short-term moves when there isn't a lot of volume. At record prices (for example in August when crude was approaching $78, or now), longs are always jumpy, and there is always some analyst providing a headline for them to get even jumpier about. When there isn't much volume, it doesn't take much buying or selling to move the price a couple of bucks. You sell enough to trigger selling, and you buy back cheap Wednesday morning for the inventory report. Or vice versa, depending on conditions.
But this kind of stuff doesn't really matter for very long. The longer a price is manipulated or based on bad information, the bigger the breakout once fundamentals are in charge again.
The wells are generally offshore and therefore should be ok even if currently not in production. It would be the loading facilities onshore that would be down for damage, lack of power and workers. Either way, the impact would be similar for the near future.
Hello Leanan,
Yep, it is sure hard to find detailed FF-info down Mexico way. A quick PEMEX google only brought back this:
http://www.mexidata.info/id1601.html
--------------------------------------
Pemex and Mexico Could Be Drowning in a Sea of Oil
Monday, November 5, 2007
Recently Pemex’s outdated infrastructure was severely damaged by heavy storms in the southern states of Tabasco and Campeche, where the larger part of oil is presently being extracted. The storm caused total havoc by disabling two oil platforms, resulting in the death of 26 workers who could not evacuate because of inoperative escape pods. The squall also shut down the three main tanker shipping ports, impeding the exportation of millions of barrels of crude oil.
----------------------------------------
Obviously, the Mexican national priority is currently focused on saving lives, but if the FF-spiderwebs are badly tattered and difficult to repair: many more lives will eventually be lost. An example of this would be transport-fuel shortages so bad that the govt couldn't move essential food, bottled water, and medicine to the devastated areas.
I hope we can find more detailed PEMEX info soon, but maybe it is now a matter of national security; the data is purposely being suppressed to keep people from really freaking out at what might be happening soon. Who knows?
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Regarding that link in your post, the headline writer obviously did not read or understand the story. From the headline, I got the impression that the story would be some cornucopean fantasy. The story is a pretty good review of the problems in the Mexican oil industry.
Hello Sterling,
Thxs for responding. Yep, my initial impression of the headline was the same, but if one peruses Pemex's sad history of oil & gas leaks leading to explosions and/or enviro-devastation, plus all the people currently treading in chemically and sewage-spicey Tabasco sauce--it makes more sense.
Here is just one example with photos:
http://www.semp.us/publications/biot_reader.php?BiotID=356
-------------------------
The Guadalajara 1992 Sewer Gas Explosion Disaster
The blasts measured 7.1 and 7.0 on the Richter scale at the University of Mexico in Mexico City some hundreds of miles away, according to one report. (16)
About 7 miles of sewer pipe exploded. The worst damage at the street level was at Gante and 20 de Noviembre streets. Varley explains that “Gante Street marked the northern edge of an industrial area and the southern edge of an old, tight-knit, densely populated and relatively poor neighborhood in Guadalajara called Analco, which sat above Guadalajara’s sewer main—a pipe 18 feet in diameter.” (14) When the pipe exploded, several city blocks were reduced to ravines containing 230,000 tons of rubble. The blast hurdled cars and busses in the air, some of which landed on nearby rooftops. Adults, children, and pets suddenly dropped out of site beneath the concrete rubble. Easter vacation explains in part the number of children victims who had been playing on the street.
---------------------------------------
Imagine what detrito-terrorists could do in a major American city if they stole a gasoline tanker, then drained it into a major and critical sewer pipe.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
91L is aiming at them again. Hopefully it will burn out over Honduras and Nicaragua.
http://www.wunderground.com/tropical/tracking/at200791_model.html
More water would be bad at this point.
Got to hand it to wiki (the concept) -
Someone has already updated their page with info on the floods of 2007.
http://en.wikipedia.org/wiki/Tabasco
They can do a hell of a lot better than that on current events. The recent conflict in Somalia was written up at a quality that puts to shame some military history textbooks, in real time. I've seen pages sprout up with hundreds of newslinks, and multiple chapters, in a few days on current events. Geopolitics, however, is considered more encyclopedic than natural disasters, so it gets more attention.
Probably, the lack of coverage on Tabasco has something to do with the combination of lack of english, lack of electricity, the raw amount of land flooded, and pre-flood lack of internet access.
Geotagged Flickr, however, is relatively good for coverage of natural disasters.
Hello PeakTO,
Pemex's latest bulletin #159 [auto-translated by google]
http://translate.google.com/translate?hl=en&sl=es&u=http://www.pemex.com...
-------------------------------------
PEMEX sympathizes with the brothers Tabasco
--------------------------------------
IMO, mostly aid-offerings--> no detailed damage assessment, nor mention of restored and smoothly-flowing FFs & electrical spiderwebs.
Sure would be nice to have an ASPO/MEX and/or TOD/MEX to post more timely and accurate info.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
"A 10in (25cm) natural gas pipeline sprung a leak after flooding apparently washed away soil underneath it, but it was unclear if other facilities operated by the state-run Petroleos Mexicanos were damaged."
http://www.breakingnews.ie/archives/?c=WORLD&jp=mhmheysnkfau&d=2007-11-02
Tabasco is the NOGC of Mexico.
Mexico's exports go to zero in 5 years anyway.
This is the most censored story right now in America.
Pakistan running a close second.
From your Pakistan article:
In analysing a crisis of this kind, one should always bear in mind that nothing difficult happens unless there is a real pressure for it to happen. General Musharraf would not have instituted the state of emergency if there had been no Islamic militants.
Chuck Prince would not contemplate resignation unless the bank had lost a great deal of money. The oil price would not be more than $90 a barrel if there were no shortage and no threat of war. Gold would not be above $800 an ounce if people trusted the dollar. Real events force painful decisions to be made."
Carolyn Baker:
"Collapse is a multi-faceted word which I frequently use in my writing and speaking. It is important to use the word and not resist it because the entire construct of civilization is collapsing in front of our eyes. For example, the U.S. has not "entered a recession" but rather the first stages of global economic collapse. Our public schools are not merely turning out undereducated students, the entire educational system is collapsing. It's not that energy depletion will make it more difficult to "grow our economy," but rather that in reality, growth is over! Although we refuse to recognize our limits on planet earth, planet earth is setting limits whether we like it or not. As James Howard Kunstler says in "Escape From Suburbia" in response to Dick Cheney's maxim that "The American way of life is not negotiable," if we refuse to negotiate our way of life, then energy depletion will make sure that we get a new negotiating partner called "reality."
When we refuse to accept the fact of collapse, we armor ourselves from endless opportunities for personal and community growth. Perhaps other collapse watchers would prefer not to hear about "opportunities" inherent in collapse, but I feel compelled to name them! "
Thanx for your Good Work, Leanan!
Keep 'em comin.
James
Arkansaw of Samuel L Clemens