by No-Oil » Fri 08 Apr 2005, 11:27:01
Whooooa there cowboys. The IMF is talking about average Crude prices, not "light sweet" crude that you see mentioned all the time at over $55 a barrel.
Some heavy crude is shipping today for less than $12 barrel & the main bulk of crude pumped in the world is of medium to heavy weight & trades for much less than the desirable "light sweet" crude that is preferred in the west for petrol production & because it is what our refineries are designed to process.
The long term futures medium/heavy crude price is around $20 a barrel at the moment (haven't looked for a while) & that was for December 2008 deliveries. Thus the IMF is correct in their predictions for AVERAGE crude prices, which encompasses all types of crude on the long term futures market.
Quote from FT report today;-
"Long-term crude futures have traded above $30 per barrel since early 2004, the first time this level has been breached. This is not just a function of higher spot prices. When crude last nudged $40 back in 2000, futures for delivery in 2010 remained steady at the $20 mark."
Note the increase is in long term futures !
Another quote from DollarDEX on 26th Feb 2005;-
"Recent cold weather has pushed up the price of oil again to over $50 p/b, but also interestingly the long term crude futures are over $40 p/b as far out as December 2010. Other commodity prices, such as copper and iron ore also continue to push higher."
Now both of those quotes could be right adjusted for todays oil outlook, so you should be able to see what the IMF is talking about, so $30-40 a barrel in 2010 is correct.
I'm having trouble finding a link to prices for medium/heavy crude trades, but they do happen, just not sure where they are traded. In fact if we could process heavy crude & get better than 50% yealds of products than we get from sweet crude, then so long as we have storage for the waste by-product we would be better off building heavy crude refineries & buying the cheap stuff ! Just an idea.
The roller coaster is still climbing, but it's near the top now !
Where there's a WAR there's a WAY