With Oil Falling, Now's the Time to Strike

The biggest oil companies are failing to increase earnings as crude trades near a nine-month low, production wanes and costs rise.

The International Energy Agency announced on Thursday that its 28 member countries had agreed to release 60 million barrels from their combined strategic stockpiles. The U.S. plans to contribute half of this total, all in the form of sweet crude. Thirty million barrels represents about 10% of the U.S.

Brent crude will hover around US$100 a barrel for the next two years, a Reuters poll showed after analysts slashed their forecasts for the oil price to reflect ample supply and sluggish economic growth. Brent crude oil will average US$107.60 per barrel this year, Reuters monthly oil price survey for April predicted on Tuesday, down from US$110.80 in last month’s poll and below last year’s average price of US$111.70.

“I don’t see how it’s going to benefit consumers. I just don’t see it.” CALGARY — The Conservatives in Ottawa are staunch supporters, the New Democrats have called it a “win-win-win” and the premiers of Alberta and New Brunswick have loudly touted the benefits of an oil pipeline from west to east.

Canadian Natural Resources Ltd. and other major Canadian oil sands stocks tumbled as crude prices collapsed on forecasts of lower demand. Canadian Natural Resources shed 4.25% of its value around11.24am EST to stand at $31.11 on Friday. Other major oil sands developers Suncor Energy Inc. (down 3.17%), Cenovus Energy inc. (-2.52%) and Husky Energy Inc. (-2.65%) underlined sector-wide weakness.

Rosneft reported one of the largest rises in crude output among the Russian oil majors last year More crude from state-owned top producer Rosneft kept Russian oil output the highest in the world last year, ahead of Saudi Arabia, Energy Ministry data showed on Wednesday. Crude output edged up almost 1% to a new post-Soviet high of 10.37 million barrels per day (bpd), but the increase could halt this year due to depleted oil fields in West Siberia.

By Kent Moors: Last month, the Paris-based International Energy Agency and the U.S. government announced they were releasing 60 million barrels of crude oil into the international market, 30 million of which coming from the U.S. Strategic Petroleum Reserve.

In recent weeks, the International Energy Agency (IEA) decided to release 60 million barrels of member states’ oil reserves into the world market in what it called an effort to ease high oil prices.  30 million barrels came from the U.S. strategic oil reserves.  Two weeks later, very little has changed in the price of oil; but looking back a few months prior reveals the likely ulterior motive to releasing the reserves.