{"id":29612,"date":"2012-05-13T22:59:20","date_gmt":"2012-05-14T02:59:20","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/2012\/05\/what-will-the-most-important-man-in-oil-and-gas-say-in-adelaide-today\/"},"modified":"2012-05-13T22:59:20","modified_gmt":"2012-05-14T02:59:20","slug":"what-will-the-most-important-man-in-oil-and-gas-say-in-adelaide-today","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2012\/05\/13\/what-will-the-most-important-man-in-oil-and-gas-say-in-adelaide-today\/","title":{"rendered":"What Will The Most Important Man in Oil and Gas Say in Adelaide Today?"},"content":{"rendered":"

By MoneyMorning.com.au<\/a><\/strong><\/p>\n

The oil and gas<\/strong> world meets in Australia this week.<\/p>\n

Today and for the next two days I’m at the 50th<\/sup> annual get-together for APPEA – that’s the ‘Australian Petroleum Producer and Explorer Association’. <\/p>\n

<\/span><\/p>\n

I packed my bags and kissed the family goodbye last night to fly up here for this year’s conference. It’s a busy day ahead and I’ll tell you more about it tomorrow.<\/p>\n

But this morning I just wanted to give you a heads up on the key issues driving the global energy market…what they mean for Australia…and most importantly what they mean for you…<\/p>\n

With over 3000 delegates meeting at Adelaide’s Convention Centre it’s by far Australia’s biggest oil and gas conference.<\/p>\n

No wonder it was so hard to find a hotel room! <\/p>\n

The important thing to note is that this is not<\/em> the kind of resources conference that’s full of big and small companies spruiking their story. APPEA is a real industry event where the biggest players in the game get together to talk technical. <\/p>\n

In fact, the keynote speaker is none other than Saudi Arabia’s oil minister, ‘His excellency’ Ali Al-Naimi.<\/p>\n

Saudi Oil and Gas<\/h3>\n

<\/center><\/p>\n

As guardian of the world’s largest oil and gas exports, he may be the most powerful person in the world of energy<\/a>. They call him ‘The<\/u> Central Banker of Oil’<\/em>. <\/p>\n

As I write, he hasn’t spoken yet. But his talk this morning will be on ‘The future of oil and gas – a Saudi Arabian perspective’<\/em>. <\/p>\n

But the real question everyone wanted to ask is just how Saudi Arabia hopes to increase its oil output to the levels it keeps telling the world it can.<\/p>\n

Every time the oil price creeps up, the Saudi’s talk the price down<\/a>. They say they’ll increase production to suppress the price. Why do they want a lower oil price<\/a>? Excessively high prices make people look for alternatives, which is no good for a country that makes all its money from oil. <\/p>\n

It’s a clever trick, because Saudi Arabian oil exports have never even come close to the levels they claim possible<\/em>.<\/p>\n

Oil fields have a natural lifespan, and Saudi’s fields are no spring chickens.<\/p>\n

This chart shows Saudi Arabian oil exports since 1970. It’s never been above 10 million barrels a day, let alone the 12.5 million barrels a day – the red line – Saudi Arabia claim they can produce. <\/p>\n

Saudi Arabian oil exports – never come close to claimed potential<\/u><\/p>\n

\"Saudi<\/a>
Click here<\/a> to enlarge<\/div>\n

<\/p>\n

Source: TTMYGH, via Grand Private Equities<\/div>\n

<\/em><\/p>\n

I’d like to ask ‘His Excellency’ about the mismatch between actual production levels and claimed production potential, but unfortunately there isn’t a Q&A after Ali Al-Naimi’s speech. So I’ll have to bail him up later instead, and maybe soften our friendly teetotaler up over a few hot chocolates.<\/p>\n

I could also ask him if he reckons his country can keep the US as an ally. Especially when the shale gas revolution<\/a> will see the US become far less dependent on Saudi oil in the coming decades.<\/p>\n

Saudi Arabia is in an interesting position<\/a> right now, so I’m keen to hear what he has to say.<\/p>\n

In a resources market that has taken some serious body blows in the last 6 months, oil and gas stocks<\/a> are still doing well. One reason is this doubt that Saudi Arabia has any spare supply<\/a>. The bigger reason energy stocks are doing well is simple: the world’s energy needs<\/a> are increasing<\/u>. <\/p>\n

The International energy Agency (IEA) estimates global energy demand will increase by ONE THIRD in the next 25 years. That’s a huge jump. <\/p>\n

Most importantly, the IEA reckon China and India will account for HALF of this growth. <\/p>\n

Australia’s Big Bet on Oil and Gas<\/h3>\n

<\/center><\/p>\n

China is already Australia’s biggest customer, taking a quarter of our exports. But don’t overlook India. In recent years it has gone from 1%, to now taking 7%<\/u> of our commodity exports. And India is a story to keep watching in coming years. Both these numbers are rising fast. This gives Australia’s fast expanding energy sector a great opportunity. <\/p>\n

This is why Aussie firms are making a colossal bet<\/u> on things panning out like this. <\/p>\n

The total investment in Australia’s oil and gas sector in the period to 2020 is estimated to be $330 billion<\/u>. <\/p>\n

To put that in context, it would be like spending a THIRD of Australia’s super-fund pool on oil and gas projects in the next 8 years. <\/p>\n

The $330 billion to be spent on oil and gas projects is also an incredible 60%<\/u> of the $550 billion planned investment for all resource industry investments in that time. <\/p>\n

Like I said, we’re betting big on oil<\/a>. <\/p>\n

The CEO of Total S.A. [NYSE: TOT]<\/strong>, one the world’s biggest oil companies, is also talking about turning Australia into a ‘global energy hub on par with the Middle East, Canada and Russia’<\/em>. <\/p>\n

I’ve tipped oil and gas stocks for Diggers and Drillers<\/a><\/em> readers this year, and plan on tipping more. This is maybe the most important theme in the resources market today. <\/p>\n

And after this weekend’s terrible economic numbers from China – showing imports have all but stopped growing – oil and gas will be one of the few areas of the resource sector that stand to keep performing for the foreseeable future. <\/p>\n

Dr. Alex Cowie
\nEditor, Diggers and Drillers<\/strong><\/p>\n

Related Articles<\/em><\/strong><\/p>\n

The Conference of the Year “After America” DVD<\/a><\/p>\n

The Great Push North for Arctic Oil Continues<\/a><\/p>\n

Why Europe Will Ditch Green Energy<\/a><\/p>\n

\n<\/img><\/a> <\/img><\/a> <\/img><\/a>\n<\/div>\n


\nWhat Will The Most Important Man in Oil and Gas Say in Adelaide Today? <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

By MoneyMorning.com.au The oil and gas world meets in Australia this week. Today and for the next two days I’m at the 50th annual get-together for APPEA – that’s the ‘Australian Petroleum Producer and Explorer Association’. I packed my bags and kissed the family goodbye last night to fly up here for this year’s conference. … <\/p>\n

Continue reading “What Will The Most Important Man in Oil and Gas Say in Adelaide Today?”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-29612","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/29612","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=29612"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/29612\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=29612"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=29612"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=29612"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}