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The world has to get used to high oil prices

El Khabar (Algeria)
The international hydrocarbons expert, Nicolas Sarkis said the world has to get used to high oil prices in the future, as the depletion of oil and the drop of reserves in several countries are a fact not fiction. He further said some OPEC member countries, like Indonesia transformed into non-exporter countries, while the US reserves have dropped. He pointed out that Western countries tend imposing guilt complex on OPEC country members as they exercise an intellectual terror against OPEC while making it always responsible for oil soaring prices.

…El Khabar: Some theorists believe “oil peak” is inevitable, regarding current reserves and production, what do you think?

N.S: The idea of peak oil depletion is a reality, not fiction. The world has to be aware of the fact that oil is depletive… we are discovering less and less oil fields than before. We have discovered during the past few years only two or three big fields. Current supplies will not be able meeting increasing demands…there are new not expected data: merging states like China and India consume more and more. The increase rate is estimated to reach 11 to 15 %. There are two chocks: demand is growing quickly but offer is not going in line with it as expected.

El Khabar: What is the role of OPEC in all this?

N.S: OPEC cannot pursue increasing production as the majority of its members reached the maximum of their production capacity. Today there’s a feeling that these countries were betrayed as they were asked to increase production and at the same time warned from the collapse of their economy. OPEC has been a subject to intellectual terrorism. It’s abnormal to see exporter countries feeling guilty because of soaring prices. Current 100 USD oil prices are the same recorded in 1980 compared to power purchase of that era. However, the largest beneficiaries of this situation are industrial countries who cut more than 100% of the oil price as taxes from consumers.
(2 March 2008)
El Khabar is an “Algerian independent daily newspaper.” Nicolas Sarkis is director of the Arab Petroleum Research Centre and editor of the review Le pétrole et le gaz arabes (Paris)

The translation is a little rough, but the basic idea comes across. One suggestion: couldn’t we agree not to use the word “terrorism” just to describe behavior we don’t like? It’s a bit of a conversation-stopper.

Another article by Nicolas Sarkis in Le Monde diplomatique, saying that the post-petroleum age has begun: L’après-pétrole a déjà commencé. -BA

Oil prices to stay above 60-70 dollars: Saudi Arabia

Saudi Arabia’s oil minister believes oil prices are set to stay above a minimum price of 60-70 dollars per barrel, signalling a new era for world energy markets, he said in an interview released Sunday.

Ali al-Nuaimi, one of the most influential people in the business as oil minister for the world’s biggest crude producer, said “a line has been drawn below which prices will not fall.”

… He also said that [Saudi Arabia], which already has the biggest proven oil reserves in the world and exports 10 million bpd, planned to add another 200 billion barrels of oil to its proven reserves figure.

He said this was “to reassure the world that we are not going to run out of oil in the next five to ten years as peak oil theorists say.”
(1 March 2008)
It’s surprising that Mr. Al-Nuaimi misunderstands peak oil theory: no one is saying that we will run out of oil in 5-10 years. -BA

Under the pump

Peter Weekes, The Age
IT WAS not just motorists who were in for a shock as the the price of oil passed $US103 a barrel for the first time in history on Friday. The soaring price of “black gold” is likely to affect everything from airline travel and taxis to investing, and even what you can afford to put on your dinner table.

AMP Capital Investors’ Shane Oliver calculates that while the strong Australian dollar is helping to offset higher energy prices, motorists will soon be forking out at least $1.50 a litre for unleaded petrol if world oil prices stay around current levels.

Despite some expectations of slightly lower demand due to slowing global growth, most analysts say the oil price won’t fall any time soon. The reason is that even if demand does slow, it will be offset by a rush into crude futures that provides an investment haven from the sagging US dollar, says Victor Shum, an energy analyst with Purvin & Gertz in Singapore, who warns of an emerging price bubble.
(2 March 2008)
Contributor Stuart McCarthy writes:
This is one of the best articles to date in the Australian mainstream print media.

Independent truckers see end of the road

Ellen Simon, Associate Press
… Trucking’s owner-operators, the self-employed drivers who haul everything from Hummers to hay, are suffering. Many say they’re running on the edge of bankruptcy, about to disappear unless they get help. While a wave of trucking failures now might be invisible to consumers, when the economy rebounds, it would push up shipping rates, helping increase prices.

The housing downturn and decreased consumer spending have cut into loads; the extra trucking capacity is pushing down freight rates. Diesel prices, which are always higher in the winter, have hit such highs that runs ads for thief-stopping fuel-tank locks.
(1 March 2008)