Tuesday, June 13, 2006

Worldwide energy prices start fall Greens say earth is flat

As we observed in our previous post with the Greens criticism of the Reserve bank pricing of oil as economic constraints,there are some interesting developments in the oil and gas markets.

Lord Browne, the chief executive of energy giant BP, has predicted that the price of oil could drop as low as US$25 a barrel, in direct contrast to a market that sees prices remaining sky-high.

The long-standing leader of BP, the world's second largest oil company, said that while prices will not moderate in the near term, within five years, Lord Browne of Madingley saw oil coming down to US$40. In about a decade, he predicted the price could be as low as US$25.

Oil prices are continuing there downward trend since the start of the Russian rouble denominated trading market commenced in Moscow last thursday.

Brent crude dropping to 65.90 overnight.

The Russian trading market is designed to allow the direct delivery of oil and its derivitives at long term sustainable prices where small companies can purchase delivery of oil and fuels oil for thier own consumption.

Purchase options are at fixed points and a marketable parcel is around 10 barrels.The security is 5% and the commission per contract is 1 rouble around 5 cents NZ.

This allow small transport companies in europe to purchase their diesil requirements in advance.


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