Hmm, I came across this tidbit while reading the transcript of the Frontline Q1 Earnings on this site. Frontline is a Tanker company and CEO Jens Jensen was talking about the Chinese shipping more crude before the Olympics.
Subsequently, we have seen the Chinese oil imports rising quite a lot, and the increased activities for the East.
We believe that China has been adding extra imports, maybe to build up some stocks before the Olympics should they decide to maybe, use a little bit less coal for pollution reasons.
That would dovetail nicely with the idea that the Chinese are increasing near-term oil demand and driving up prices. So they are planning on burning less coal for their power plants and more oil during the Olympics so we don't see Chinese stadiums wreathed in yellow smoke and marathoners coughing up black phloem.
I can see the Chinese paying any monetary price in order to make this Olympics go 100% perfect. After all they view it as their coming out party for the world. So as I see it oil prices will probably come back down to $100 a barrel or less by June or July. That is because Chinese oil purchases should go back to normal as they go back to using coal to feed their power plants.
Hmm, so we have Indian Subsidies and Chinese anti-pollution window dressing as a few new causes for this $135 spike in oil. I guess the price rise can't all be pinned on shady money-men and billion dollar hedge funds as the media would have us believe.
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