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28 million barrels of sour crude parked in tankers in the gulf
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The Analog Guy 
User ID: 74180
5/23/2008 11:08 AM
Report abusive post | 28 million barrels of sour crude parked in tankers in the gulf
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Need some refineries to convert to process Sour Crude.
[link to www.rightsideadvisors.com]
Shortage Or Plenty?
May 19, 2008
Jim Brown
OPEC claims there is plenty of oil in the system and yet there is not enough to go around. Why is that so? I have explained this many times in the past but not for several months. All oil is not equal. There is light sweet crude with very little sulfur that is easily refined into gasoline. There is heavy sour crude that flows slowly and has very high sulfur levels. Only a few refineries can refine this grade into gasoline because of the extra and expensive processes necessary to remove the sulfur before it becomes gasoline or diesel. There is also a variety of grades in between. A single refinery is built to process a specific kind of oil. If it is setup to refine light sweet crude then it cannot refiner heavy sour because the processes are different. That is a simple explanation but there are dozens of variants. Suffice to say that a refinery can only process certain grades of crude and no others. This is the equivalent of you pulling into a filling station for regular unleaded and all they have is diesel. You can't use it even if it was selling for 10 cents per gallon. If you don't have gasoline you can't drive. Period.
There is plenty of oil available in the world. Unfortunately there is a shortage of light sweet crude. For instance Iran is drowning in sour crude at present for what was initially thought to be a refinery down for maintenance reasons. There are tankers with more than 28 million barrels of Iranian crude parked in the Persian Gulf waiting for that refinery to restart. It turns out that may not be the problem but I will get to that later. Iran pumps 4 mbpd and exports 80% of that oil. It is heavy sour crude with few refineries capable of using it. That parked oil has increased from 20 million barrels to 28 million in just the past week. Plenty of oil but no place to go. Some analysts wonder if this excess oil is the result of U.N. sanctions finally taking hold. We found out on Friday that Iran had just contracted for another VLCC tanker from Singapore's Tanker Pacific. Nobody really knows why this oil is just parked in the gulf and costing Iran $56,000 per day per ship to just sit there. (I will pose another scenario later.)
Venezuela's oil is also a heavy crude with very few refineries built to process it. If the U.S. suddenly cut off imports from Venezuela they would be swimming in oil very quickly with nobody to buy it.
When OPEC says there is plenty of oil in the system and they can't find buyers for all of their supplies they are actually telling the truth. They are just not telling the whole truth. There is a surplus of sour crude and a shortage of sweet crude. When you see us talk about the price of oil that is the price of sweet crude, which is the benchmark for oil prices. Everything else is priced at a discount to light sweet crude. OPEC has complained for years that there is not enough refining capacity around the world to take advantage of all the crude available. They are completely correct. If there were a dozen more refineries capable of processing sour crude then there would be no oil shortage today. In a couple years definitely but not today.
Iran musings: Iran now has 28 million barrels of crude parked in the Persian Gulf. Why? Here is where the plot thickens. You may remember Iran threatened to cut production last week and that sent oil prices soaring before the claim was softened. Is Iran just waiting for oil prices to go higher to get a better price for their oil? Was the production cut rumor a way to jack up prices even higher? Surely they would not take this big of a gamble worth billions of dollars with a plan to bluff prices higher. Absolutely they would! They tried this exact strategy in 2006 and failed. Beginning in March of 2006 Iran started making threats that they were going to cut production while storing 20 million barrels of crude in tankers parked in the gulf. Unfortunately for Iran instead of paying Iran's higher price for crude there was enough oil on the market then for traders to just buy elsewhere. Iran's bluff did not work and they ended up selling it at a huge discount to Shell and India's Reliance. It appears Mahmoud Ahmadinejad is so desperate for money to keep his regime alive that he is trying the same trick and with Saudi willing to pump more of a higher quality oil it appears Iran is going to lose money again. Iran is in economic trouble with 45% of the population kept inline only by heavy subsidies and military force. The other 55% are ethnic Persians. Iran is extremely vulnerable right now. If the U.S. was able to pressure Iran's primary oil buyers (Japan, China, South Korea and Italy) to look elsewhere for another month or so then Iran would really be in trouble and the regime could fail. 80% of Iran's revenues come from oil and for whatever reason it is not selling. Now might be the time to tighten the noose.
[link to www.cafepress.com]
"If a man could understand all the horror of the lives of ordinary people who are turning round in a circle of insignificant interests and insignificant aims, if he could understand what they are losing, he would understand that there can be only one thing that is serious for him—to escape from the general law, to be free. What can be serious for a man in prison who is condemned to death? Only one thing: How to save himself, how to escape: nothing else is serious-Gurdjieff |
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Anonymous Coward
User ID: 303149
5/23/2008 11:42 AM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
screw them all. It is VW time and I will NEVER go back to anything bigger. |
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anonomous
User ID: 438048
5/23/2008 12:10 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
hve the means to be the big shot on the market with the worlds energy dollars compliments of thier terror war strategy which broke back of all the nations while ongoing enrichment of the middleast, with the worlds hyjacked energy dollars....................prettu good piece of work.Middleast Soveriegn wealth funds, now flow threw the world like water.for planned purchases of strategic assets on a Global scale....shiping centers corporations institutions energy companies food chains ports shipping farms toll tunnels and endlist list of global purchases for future employment of relocated Islamist.. |
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Anonymous Coward
User ID: 247323
5/23/2008 12:27 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
i like my sour crude with a dash of nutmeg. |
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Anonymous Coward
User ID: 437256
5/23/2008 12:32 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
hve the means to be the big shot on the market with the worlds energy dollars compliments of thier terror war strategy which broke back of all the nations while ongoing enrichment of the middleast, with the worlds hyjacked energy dollars....................prettu good piece of work.Middleast Soveriegn wealth funds, now flow threw the world like water.for planned purchases of strategic assets on a Global scale....shiping centers corporations institutions energy companies food chains ports shipping farms toll tunnels and endlist list of global purchases for future employment of relocated Islamist.. Quoting: anonomous 438048
They're only doing what any good business would do. I can't be mad at them about it. It's bills like SAFETEA-LU that are allowing this to happen. They're passed through congress and signed by the prez. We elect these morons to sell us out, so really it just comes back on us (REPUBLIC!). |
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Dervish
User ID: 423951
5/23/2008 12:36 PM
 | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
WOW!
OMG!
Thats like one days worth of oil for the USA.
Have no pride when it comes time to get out of Dodge
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Adapt,Improvise,Overcome |
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Anonymous Coward
User ID: 175812
5/23/2008 12:58 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
analog guy
thank you for explaining it once again. you forgot to add though that most people in the U.S. do not want to have a refinery in their back yard so there have been few refineries built in the last 27 years.
you also forgot about the sands in canada that are sour too. |
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RHSC
User ID: 431954
5/23/2008 2:03 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
[link to www.star-telegram.com]
Ed Wallace
ICE ICE BABY
19 May 2008
Ft. Worth Star-Telegram
...While researching my third article for BusinessWeek online about the world’s oil situation in 2008, I asked for the most current report from Oil Movements. Because the oil industry is not transparent, Oil Movements tracks every tanker at sea, from both OPEC and non-OPEC oil countries, along with their cargoes’ final destinations. Anne O’Shea responded immediately to my request with their report dated May 8, 2008. Just so you will know, oil shipments are up from a year ago in almost every class, including Middle East oil in transit and Non-OPEC in Transit. The only class of oil shipment that has declined is covered on page 3 of that report. That chart is labeled, "4-Week Changes in Westbound Oil at Sea."
That’s right, shipments of oil headed west have shown serious declines during the month of April, down 800,000 barrels per day in the week before the publication of the report. Now, let me give you the first line from under the Westbound Oil shipments chart: "In the west, a big share of any [oil] stock building done this year has happened offshore, out of sight."
Could this be true? Oil Movements, the unimpeachable source for finding the real world situation on oil transits, is saying that oil is being hidden offshore, not declared in inventories? Yes, that is exactly what they are saying.
That same week our refineries cut their production runs back to 85 percent, down from 89 percent a year ago, to trim more gasoline out of our stock reserves, to increase their profits per gallon. ...
********************************************************** *
Soooooo...who is parking oil "OFFSHORE" here in the west? And why? It couldn't be to manipulate the markets, right? Nobody would do THAT, right?
My cousin's son works for an oil corporation out of the mid-Atlantic region. She has informed me that she knows for a fact that when the market gets wobbly, that oil corporation does "maintenance" on one of its refineries...timed to keep the market UP.
The oil futures has been hijacked by unscrupulous SPECULATORS who are betting with OUR lives and the lives of millions of others.
We're being ENRONed. |
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Anonymous Coward
User ID: 438271
5/23/2008 2:18 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
''The oil futures has been hijacked by unscrupulous SPECULATORS who are betting with OUR lives and the lives of millions of others.''
these are the traitors we need to keep in mind as well, when it all goes tits up!
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Reflecting Pool
User ID: 104063
5/23/2008 2:21 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
there are appx 470 VLCC's (Large Crude Carriers) in operation with an average tonnage DW cap of 300,000 tonnes.
It takes 7.3 barrels to acheive a ton of DW (dead weight) so 28 million barrels equates to roughly 12-15 VLCC's at full capacity.
That's a very small fraction of the fleet. The math negates this as very notworthy.
Sorry |
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announcement
User ID: 438048
5/23/2008 2:58 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
Bus Ridership is up 17 percent in Denver Colorado dring 2007 from 2006.while bus ridership in 2006 saw a sharp increase over 2005...that is just Denver Colorado..now multiply that nation wide....i believe gas consumtion has steadily declined .but we are alwasy told it is always increasing...this would keep prices elevated..also Saudi says markets are well supplied..maybe so..so who is passing the buc..i heard U.S. was filling up fuel reserves as has beeen being done in the past..and is stored who knows where..just ask Iran..they would know where it is..or ask russia or china..they got satalites to track U.S.......it is a good thing to stockpile oil in case of National emergency.......we should all be stockpiling essentials now for hard times.just in case..pay rents ahead pay utilities ahead if possible pay phone cable ahead.etc... |
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Redheaded Stepchild
User ID: 431954
5/23/2008 3:05 PM
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Bus Ridership is up 17 percent in Denver Colorado dring 2007 from 2006.while bus ridership in 2006 saw a sharp increase over 2005...that is just Denver Colorado..now multiply that nation wide....i believe gas consumtion has steadily declined .but we are alwasy told it is always increasing...this would keep prices elevated..also Saudi says markets are well supplied..maybe so..so who is passing the buc..i heard U.S. was filling up fuel reserves as has beeen being done in the past..and is stored who knows where..just ask Iran..they would know where it is..or ask russia or china..they got satalites to track U.S.......it is a good thing to stockpile oil in case of National emergency.......we should all be stockpiling essentials now for hard times.just in case..pay rents ahead pay utilities ahead if possible pay phone cable ahead.etc... Quoting: announcement 438048
I agree that we should be stockpiling essentials NOW. I believe the market has been manipulated and we are set for a massive implosion.
"I want you to go to the window, open it, stick your head out and yell: 'I'm as mad as hell, and I'm not going to take this anymore.'"
-Howard Beale (Peter Finch), Network
“Until you are willing to organize your friends and neighbors and literally shut down cities - drive at 5mph through the streets of major cities on the freeway and stop commerce, refuse to show up for work, refuse to borrow and spend more than you make, show up in Washington DC with a million of your neighbors and literally shut down The Capitol you WILL be bent over the table on a daily basis. “Karl Denninger
Don't blame me; I voted for Ron Paul.
Silence is consent. |
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Rota
User ID: 437061
5/23/2008 3:32 PM
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Oh its those pesky Iranians again. They are cruising for a nuking.
But I prefer to live in reality. The truth is the money changers and speculaters have run the price up. Our congress could stop this speculation tommorrow but who cares if the peons starve?
a conservative calculation is that at least 60% of today's $128 per barrel price of crude oil comes from unregulated futures speculation by hedge funds, banks and financial groups using the London ICE Futures and New York NYMEX futures exchanges and uncontrolled inter-bank or Over-The-Counter trading to avoid scrutiny. US margin rules of the government's Commodity Futures Trading Commission allow speculators to buy a crude oil futures contract on the Nymex, by having to pay only 6% of the value of the contract. At today's price of $128 per barrel, that means a futures trader only has to put up about $8 for every barrel. He borrows the other $120. This extreme "leverage" of 16 to 1 helps drive prices to wildly unrealistic levels and offset bank losses in sub-prime and other disasters at the expense of the overall population. [link to www.rense.com]
I think its clear that the most important message in the bible for our time was when Jesus became violent only one time in his life time. That was when he went off on the money changers. That is what actually led to his death.
Now it seems the Christians today are in the same situation that jesus was in. People have to chose between food, gas and house payments because of the money changers. Will they follow Jesus and how he reacted to them? Hell no. There are no real Christians and the cowards will do nothing except watch their kids starve before they would ever think of confronting the greedy thieves.
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Anonymous Coward
User ID: 438275
5/23/2008 3:37 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
Oil in the Stragic Petroleum Reserve is stored in underground salt domes in Southeast Texas. It is common knowledge, not a secret. They are protected by the military with guns and electronics.
Bus Ridership is up 17 percent in Denver Colorado dring 2007 from 2006.while bus ridership in 2006 saw a sharp increase over 2005...that is just Denver Colorado..now multiply that nation wide....i believe gas consumtion has steadily declined .but we are alwasy told it is always increasing...this would keep prices elevated..also Saudi says markets are well supplied..maybe so..so who is passing the buc..i heard U.S. was filling up fuel reserves as has beeen being done in the past..and is stored who knows where..just ask Iran..they would know where it is..or ask russia or china..they got satalites to track U.S.......it is a good thing to stockpile oil in case of National emergency.......we should all be stockpiling essentials now for hard times.just in case..pay rents ahead pay utilities ahead if possible pay phone cable ahead.etc... Quoting: announcement 438048 |
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Anonymous Coward
User ID: 438275
5/23/2008 3:37 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
Oil in the Strategic Petroleum Reserve is stored in underground salt domes in Southeast Texas. It is common knowledge, not a secret. They are protected by the military with guns and electronics.
Bus Ridership is up 17 percent in Denver Colorado dring 2007 from 2006.while bus ridership in 2006 saw a sharp increase over 2005...that is just Denver Colorado..now multiply that nation wide....i believe gas consumtion has steadily declined .but we are alwasy told it is always increasing...this would keep prices elevated..also Saudi says markets are well supplied..maybe so..so who is passing the buc..i heard U.S. was filling up fuel reserves as has beeen being done in the past..and is stored who knows where..just ask Iran..they would know where it is..or ask russia or china..they got satalites to track U.S.......it is a good thing to stockpile oil in case of National emergency.......we should all be stockpiling essentials now for hard times.just in case..pay rents ahead pay utilities ahead if possible pay phone cable ahead.etc... Quoting: announcement 438048 |
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anonomous
User ID: 438048
5/23/2008 3:51 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
Iran Threatened to block waterways if it were attacked..this would stop oil flow everywhere..meanwhile Saudi is building new waterway to eliminate Irans ability to sink oil tankers blocking fuel from leaving the middleast....have you noticed that during all these yrs of Islamist nut cases fighting in the middleast ,that Saudi and other oil minsters and leaders have not told Islamist to quit thier fighting..i guess Saudi and Uae and others would not want to disrupt thier oil profits.....terror strategy has enriched mddleast with untold wealth..enough wealth for them to have stayed on a hunt for strategic global assets in all nations..this ensures job positions for incoming Islamist ...i do believe this strategy will insure that Islamist will be very comfortable and financially secure in all nations because of the of purchasing bussinesses that will be esential to any local area..like utilities Media hospitals nursing homes Grocery store shoping centers ...yep i see the bigger picture now..and why the strategy of terror was used this time unlike 970 s embargos and 1980 s near depression on global scale from oil price spikes that fuel 12 percent infltion plus globably..same people same strategy ..20 yrs later..the Arab - persians..get rich schemes |
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anonomous
User ID: 438048
5/23/2008 4:00 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
Iran Threatened to block waterways if it were attacked..this would stop oil flow everywhere..meanwhile Saudi is building new waterway to eliminate Irans ability to sink oil tankers blocking fuel from leaving the middleast....have you noticed that during all these yrs of Islamist nut cases fighting in the middleast ,that Saudi and other oil minsters and leaders have not told Islamist to quit thier fighting..i guess Saudi and Uae and others would not want to disrupt thier oil profits.....terror strategy has enriched mddleast with untold wealth..enough wealth for them to have stayed on a hunt for strategic global assets in all nations..this ensures job positions for incoming Islamist ...i do believe this strategy will insure that Islamist will be very comfortable and financially secure in all nations because of the of purchasing bussinesses that will be esential to any local area..like utilities Media hospitals nursing homes Grocery store shoping centers ...yep i see the bigger picture now..and why the strategy of terror was used this time unlike 970 s embargos and 1980 s near depression on global scale from oil price spikes that fuel 12 percent infltion plus globably..same people same strategy ..20 yrs later..the Arab - persians..get rich schemes |
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tbear4
User ID: 170234
5/23/2008 7:29 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
South Dakota is building a refinerie! |
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Anonymous Coward
User ID: 420101
5/23/2008 7:39 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
Need some refineries to convert to process Sour Crude.
[ link to www.rightsideadvisors.com]
Shortage Or Plenty?
May 19, 2008
Jim Brown
sniped for a correction.
Venezuela's oil is also a heavy crude with very few refineries built to process it. If the U.S. suddenly cut off imports from Venezuela they would be swimming in oil very quickly with nobody to buy it.
In a joint deal with china a pilot refinery was opened and then increased to 30 k barrels per day in china.
Made to handle Venezuela crude. |
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anonomous
User ID: 438410
5/23/2008 7:58 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
if china is getting in bed with venezuela for oil refinery and china getting in bed with cuba to do lateral drilling for oil off cuban coast and russia is providing china with nuclear reactor, then i see a new strategic alliance occuring..Iran is already in bed with russia and venezuela...so china joins in and will prolly soon start deals with iran..omg..U.S. stands alone....these nations blocked U.S. ability at U.N. to stop Iran..omg.. |
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Old White Russian
User ID: 438451
5/23/2008 8:22 PM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
Peak Oil is here.
28 million barrels, wow, thats like 4 hours oil for the whole world. |
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Anonymous Coward
User ID: 381230
5/24/2008 2:09 AM | | Re: 28 million barrels of sour crude parked in tankers in the gulf | Quote |
YES! people are getting it!!!! we KNOW OUR OWN PEOPLE, our countrymen, the big bankers, are fuckin us all. there is no shortage. |
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