Wednesday January 30, 2008

Mexicos Cantarell oil production declined at 18% depletion rate in 2007

greencarcongress.com :

Oil production from Mexico's giant Cantarell offshore complex continued its steep decline in 2007, dropping to a combined average 1.458 million barrels per day (mbpd) of production from all the fields, down 18% from 2006. The rate of decline remans more rapid than PEMEX had anticipated. Cantarell's production peaked in 2004 at 2.113 million barrels per day, according to SEI data.

The US imported an average of 1.705 million barrels per day of crude from Mexico in 2006 - 12.4% of the total imported - making Mexico the number two source of imported crude behind Canada, with 2.353 mpbd in 2006 (17.7%), according to data from the Energy Information Administration.

- Compared to the peak in 2004, Cantarell's oil production is down 31% in the span of just 3 years. This is a huge decline. Note that this is the world's second largest oil-field. All eyes are on Saudi Arabia's Ghawar now, being the world's largest oil-field. As energy investment banker Matt Simmons says, if Ghawar has peaked, then the world has peaked.

According to Matt Simmons, we have already hit peak oil in ordinary, conventional oil in May 2005. The global peak in all categories of oil is not very far off. ASPO's estimate for the date of global oil peak is 2010, which is just 2 years from now. And the world does not seem to be doing much about it.

See also :

1. Mexico's oil output cools
2. Will Mexico soon be tapped out?
3. Fiscal crisis for Mexico as oil starts to dry up
4. Second largest oil field dying

(2008-01-30 20:46:11 SGT) [Energy] Permalink Comments [4]

New home sales plunge record 26% in 2007

news.yahoo.com :

Sales of new single-family homes plummeted a record 26% in 2007 and builders slashed prices by the most since 1970 in a struggle to cope with a housing bust, a government report showed on Monday [28 Jan 2008]. The report offered little hope for a turnaround any time soon as a record one-month drop in the median home price for December failed to stoke demand and the number of months needed to clear the inventory of unsold homes rose.

The figure of 774,000 homes sold last year was the lowest since 757,000 were sold in 1996. Sales have tumbled 39.6% from 1.283 million at the peak of the market in 2005. The median new home sales price fell 10.9% from November to $219,200, 10.4% below the year-ago level. However, despite those price cuts the glut of houses available continued to swell and put pressure on builders to slow construction below its current crawl, economists said.

- There's got to be a bottom, we just haven't seen it yet. Could take a while. And there's always the "hyper-inflation option".

See also :

1. Median home price dropped for first time in 40 years
2. Housing sales drop in 40 states

(2008-01-30 08:08:08 SGT) [Biz] Permalink

PetroChina drops 44% - so much for the BRIC decoupling theory

bloomberg.com :

The biggest slide in emerging-market stock valuations in a year and a half is proving that a slowdown in the U.S. economy still matters to Brazil, Russia, India and China. Companies such as PetroChina, the country's biggest oil producer, and Russia's OAO Lukoil show the threat of a global slump is shaking the confidence of investors who viewed developing countries as a haven from the US.

PetroChina's 44% plummet since November erased about $400 billion, more than the market value of Microsoft. Russian stocks are headed for their biggest loss in 19 months after money managers bought an unprecedented amount in 2007. Predictions of a contraction in the U.S. pushed 46 of the world's 67 largest indexes down to at least 20% below their previous highs as of last week, qualifying the markets as bear.

- You know, for a while Petrochina had a bigger market cap than Exxon-Mobil. What a hoot. Saudi Aramco I might believe, but Petrochina? No way.

Also, in order for the decoupling theory to work, to be the new Atlas supporting the global economy, the Asian consumer has to be as profligate in spending as the American consumer. Except for some members of the younger generation, that is not likely to happen any time soon.

See also :

1. Stock drop pulls 38 indexes into bear market
2. Stocks plunge, 2007 gains wiped out

(2008-01-30 00:50:07 SGT) [Biz] Permalink

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