Huge Oild Find In Gulf Of Mexico

[Golden Shower]

Three companies led by US-based Chevron say they have found an oil field under the Gulf of Mexico that could boost US reserves by more than 50%.

http://news.bbc.co.uk/1/hi/world/americas/5318776.stm

Could mean a huge shift in the economic arguments. Not just the price of energy etc. but it may give the US the excuse it needs to take on Iran or disengage from the region. Doesn't the US get about 25% of it's oil from the ME?

Wonder how long it would take to start production there?

Edited September 6, 2006 by Golden Shower

[alexays]

http://news.bbc.co.uk/1/hi/world/americas/5318776.stm

Could mean a huge shift in the economic arguments. Not just the price of energy etc. but it may give the US the excuse it needs to take on Iran or disengage from the region. Doesn't the US get about 25% of it's oil from the ME?

Wonder how long it would take to start production there?

Its going to take several years. It is extremely deep water and it is going to be extremely challenging to get the stuff up. There are no pipelines near it. By the time it comes onstream - if it ever does we will be well past the world peak production.

Also notices the use of "could boost". I think that is taking a lot for granted.

[Guest Alright Jack]

http://news.bbc.co.uk/1/hi/world/americas/5318776.stm

Could mean a huge shift in the economic arguments. Not just the price of energy etc. but it may give the US the excuse it needs to take on Iran or disengage from the region. Doesn't the US get about 25% of it's oil from the ME?

Wonder how long it would take to start production there?

It is truly great news, and how timely!

I hope my suspicions are ill-founded.

[Della]

It'll probably lead to a fall in the oil price because recently the oil price has been going up and down because of events in the US, that only affect the US, events which rationaly should have little effect on the global price of oil.

[Pooh Bear]

It is truly great news, and how timely!

I hope my suspicions are ill-founded.

This timely news has changed everything. They will clearly be giving petrol away free in the supermarkets next year. Hurrah!

[?...!]

It will not affect the price.

The oil price is driven by supply & demand, and the possibility of dissruptions over the next 3 months.

This particular field is some time from extraction, although its discovery is very good news.

[Broken Fan]

It will not affect the price.

The oil price is driven by supply & demand, and the possibility of dissruptions over the next 3 months.

This particular field is some time from extraction, although its discovery is very good news.

They dont go much into detail, but this find doesnt sound that big in comparison to the 20 million bbls/day that the US feasts on, at present, nevermind what it is projected to be by the time this comes onstream.

[PropertyGuru]

They've known about it for ages.

It's only recently become economically viable thanks to the rapid rise in oil prices.

They probably have another dozen or so 'up their sleeves' that will be revealed as and when prices top 100 bucks and 150.

[Realistbear]

Dollar is up almost 2 cents aginst the pound today.

I have always suspected that the US has huge oil reserves. There is talk about opening up the fields off the West Coast where the environmentalists have been saying no.

If these reports are true it will shift the economic balance back to the US. I am pleased to be holding US $ rather than sterling at the moment as NS Oil does seem to be runing down.

[BoredTrainBuilder]

This particular field is some time from extraction, although its discovery is very good news.

Why?

Burning the black stuff is causing the world to bake.

Better leave it in the ground, surely?

[BoredTrainBuilder]

I have always suspected that the US has huge oil reserves.

You truly are omniescent, whether the subject is market movements on a Monday or US oil reserves. Is there any field in which you do not have complete foresight?

Hail RB.

[SarahBell]

http://news.bbc.co.uk/1/hi/world/americas/5318776.stm

US reserves? Do they mean their emergency reserves that they laid into last hurricane season? Or do they mean general overall ?

[Gone baby gone]

US reserves? Do they mean their emergency reserves that they laid into last hurricane season? Or do they mean general overall ?

They mean everything that they know of (in the ground) and are able to extract.

[Realistbear]

You truly are omniescent, whether the subject is market movements on a Monday or US oil reserves. Is there any field in which you do not have complete foresight?

Hail RB.

Many people suspect things about oil as they are not the most publiclly spirited people on the planet. Its naive to accept things at face value where big oil is concerned.

[Della]

Deleted

Edited September 6, 2006 by Della

[Realistbear]

http://money.cnn.com/2006/09/05/news/compa..._gulf/index.htm

Major U.S. oil source is tapped

Successful test by Chevron partners in deep Gulf waters could rival Alaska in potential supply; U.S. reserves may swell 50 percent.

By Chris Isidore,

CNN

Money.com senior writer

September 5 2006: 5:46 PM EDT

NEW YORK (CNNMoney.com) -- Chevron and its partners have successfully extracted oil from a test well in the deep waters of the Gulf of Mexico,

an achievement that could be the biggest breakthrough in domestic oil supplies since the opening of the Alaskan pipeline.

1 U.K. £ =

1 1.8868

1.90+ yesterday.

[murpaul]

http://money.cnn.com/2006/09/05/news/compa..._gulf/index.htm

Major U.S. oil source is tapped

Successful test by Chevron partners in deep Gulf waters could rival Alaska in potential supply; U.S. reserves may swell 50 percent.

By Chris Isidore,

CNN

Money.com senior writer

September 5 2006: 5:46 PM EDT

NEW YORK (CNNMoney.com) -- Chevron and its partners have successfully extracted oil from a test well in the deep waters of the Gulf of Mexico,

an achievement that could be the biggest breakthrough in domestic oil supplies since the opening of the Alaskan pipeline.

1 U.K. £ =

1 1.8868

1.90+ yesterday.

Does this mean the USD is worth a short term punt to profit on the rise compared to GBP? Or are currency fluctuations really as impossible to predict as it seems?

[Della]

http://money.cnn.com/2006/09/05/news/compa..._gulf/index.htm

Major U.S. oil source is tapped

Successful test by Chevron partners in deep Gulf waters could rival Alaska in potential supply; U.S. reserves may swell 50 percent.

By Chris Isidore,

CNN

Money.com senior writer

September 5 2006: 5:46 PM EDT

NEW YORK (CNNMoney.com) -- Chevron and its partners have successfully extracted oil from a test well in the deep waters of the Gulf of Mexico,

an achievement that could be the biggest breakthrough in domestic oil supplies since the opening of the Alaskan pipeline.

1 U.K. £ =

1 1.8868

1.90+ yesterday.

Total revenue from field if it opened tommorow: $9.9 billion/year (It may take a decade or more to get up to that level)

US trade deficit: $777.6 billion a year (based in June's figures, up from $717 billion last year)

Edited September 6, 2006 by Della

[padders]

As I understand it the reserves in this field represent 33 days of current world oil consumption and won't be on tap until 2012. That, and the oil was already known about. A big announcement that may help lower gas prices (because of illogical sentiment change) can't be a bad thing for th incumbants in the US midterm elections though, can it.

[Realistbear]

Does this mean the USD is worth a short term punt to profit on the rise compared to GBP? Or are currency fluctuations really as impossible to predict as it seems?

Pound down almost another 25 basis points

1 U.K. £ =

1 1.8839

http://www.fxstreet.com/rates-charts/forex-rates/

I am not sure--my long term bet is on the US $ against sterling. Short term fluctations are always there although the pound has been very steady against the dollar for a few days at around 1.90 until today when it has dropped to 1.8833 at one point. Not sure if the oil find has anything to do with it or not. It could boost US consumer confidence and would be an enormous psychological lift as the feeling of dependence on Arab oil will dissipate somewhat. I can tell you this--if the oil find is as big as some say it is, my confidence in the US $ will get a boost.

I am going for the long term historical average (10 year) and may buy sterling when it hits somewhere in the 1.60s. IMO, the HPC will have to get underway a little more strongly first.

As I understand it the reserves in this field represent 33 days of current world oil consumption and won't be on tap until 2012. That, and the oil was already known about. A big announcement that may help lower gas prices (because of illogical sentiment change) can't be a bad thing for th incumbants in the US midterm elections though, can it.

Could be--this article suggests a 20 year supply at 400k bbl per day--a low end estimate:

http://news.bbc.co.uk/1/hi/world/americas/5318776.stm

According to John Kilduff, an analyst quoted by the AFP news agency, the new oil field could produce 400,000 barrels for 20 years -

even at its lowest capacity.

[murpaul]

Pound down almost another 25 basis points

1 U.K. £ =

1 1.8839

http://www.fxstreet.com/rates-charts/forex-rates/

I am not sure--my long term bet is on the US $ against sterling. Short term fluctations are always there although the pound has been very steady against the dollar for a few days at around 1.90 until today when it has dropped to 1.8833 at one point. Not sure if the oil find has anything to do with it or not. It could boost US consumer confidence and would be an enormous psychological lift as the feeling of dependence on Arab oil will dissipate somewhat. I can tell you this--if the oil find is as big as some say it is, my confidence in the US $ will get a boost.

I am going for the long term historical average (10 year) and may buy sterling when it hits somewhere in the 1.60s. IMO, the HPC will have to get underway a little more strongly first.

So to paraphrase, and probably show my ignorance, GBP is overvalue compared to the long term average, meaning USD is worth a go. That is however dependent on the strength of the US and UK economies. When, and it is when, the smoke and mirrors of the UK economy is seen for what it is, then sterling will fall against the dollar?

[padders]

According to John Kilduff, an analyst quoted by the AFP news agency, the new oil field could produce 400,000 barrels for 20 years -

even at its lowest capacity.

400,000 barrels for 20 years = 3 billion barrels. This is current world consumption for 35 days, spready over 20 years. So, this major discovery accounts for just under 2 days of oil consumption over the whole year for 20 years. Of course we will be using more oil by then, so it wont even be that much.

Not to mention this the 400,000 barrels per day extra is about the same amount Mexico's Cantarell oil field decliened in production this year.

http://en.wikipedia.org/wiki/Cantarell_Field

So to paraphrase, and probably show my ignorance, GBP is overvalue compared to the long term average, meaning USD is worth a go. That is however dependent on the strength of the US and UK economies. When, and it is when, the smoke and mirrors of the UK economy is seen for what it is, then sterling will fall against the dollar?

I think so, but I don't think that $1.90 is the highest the pound may go against the dollar. I plan to move my savings as it gets close to $2. Of course, it may never get there and I miss the boat.

[MarkG]

So to paraphrase, and probably show my ignorance, GBP is overvalue compared to the long term average, meaning USD is worth a go.

I believe the _long_ term average is around $4 to the pound, so using averages to guess what the future rate may be is not terribly useful: it's largely dependent on the actions of the central banks, who could decide to do anything. I doubt that recent fluctuations have had much to do with some little new oil field.

[Sledgehead]

Edited September 6, 2006 by Sledgehead

[keegans 70's perm]

and of course the oil price has been lower also due to the calm hurricane season. Big one is brewing in the Atlantic apparently.

Could push the oil price right back up where it has just come from?