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Systematic Shutdown Of (2.4MM Barrels Per Day) Nigerian Oil Ahead
Crude prices rose modestly this morning so far (up to $102) as news of the Nigerian oil and gas union will shut down all production starting Sunday in a nationwide strike over fuel prices. As the Associated Press reports, the nationwide strike has been under way since Monday and the 20,000 oil and gas union members joining on Sunday will mean a top supplier of crude to the US (approximately 2.4mm barrels per day) will stop production. The union notes that the Nigerian government's reversal of a two-decade-long subsidy program to keep gas prices low for Nigerians "forced them to go ahead and apply the bitter option of ordering the systematic shutting down of oil and gas production." The market for now does not seem too bothered by this drop in supply, even in the tight markets we are facing, as most of the oil move seems driven by USD weakness post the ECB decision - perhaps things will change when the unions call the market's bluff on Sunday?
Chart: Bloomberg
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BULLISH
Nigerians will just burn it all driving across the street in SUVs...oh no, wait, that's us.
HA!! Africa is now the new Middle East...Next Antartica...Then outerspace...Lots of REE's on those asteriods...............
Oh fuck! Send in NATO!
You know exactly why they don't send US troops in there. They don't come back. If anyone considers human life cheaper than a US Defense contractor, it's a 13 year old with an ak-47 and a hair trigger loaded to the tits with cocaine and booze.
I wouldn't be surprised if they tried though.
Sad but true; when children are conditioned towards violence, they are much worse than adults.
bomb them too
Either Cheney or one of his pets wrote a piece on sub Saharan Africa a couple years back. Don't you worry, the neocons have their eyes on this region too. CIA has been recruiting for this area for awhile now.
http://www.amazon.com/Oil-Terrorism-New-Gulf-Security/dp/0739109898
/oil-crisis-in-a-thousand-words/
Or less...
ori
Only a matter of time before 'Al-Qaeda' moves in..............
Thats right!
UN warns that Nigeria's Islamist group Boko Haram could be guilty of crimes against humanity- @AFPWhich year?
Seriously it's an area that after processing rare minerals they process the human bodies to get the rare earth elements out of the human bodies.
The already have a "complicated" domestic situation. The one thing foreign intervention is very good at is uniting the locals against the outsiders.
Awesome, bullish for my latest venture into organic farming!
Even more bullish for my inorganic 15bbl/d stripper wells.
Come on man, I was sleeping real good and my keyword alarm went off. Did someone say stripper???
Yeah. Now dance.
At least until they are nationalized due to security reasons. I am less concerned with this happening to my broccoli (good thing we don't grow peas).
http://en.wikipedia.org/wiki/Nigerian_National_Petroleum_Corporation
Congrats, you're only 33 years late!
Pay attention idiot, I wasn't talking about Nigeria's oil wells. I thought scientists paid attention to details.
So, Nationalized Strippers of Nigeria? Perhaps you should type more clearly...:>D
No, no, no. It's the Nationalized Organic Broccoli Stripper Farms of the USA. ;-).
@LOP,
how about this then?
http://realitybloger.wordpress.com/2012/01/08/that-isn-wax-on-your-apple/
ori
Don't worry! Uncle Wam Bam Sam has 3 US carriers right outside Hormuz locked stocked and ready to "bomb bomb bomb, bomb bomb Iran" - John McCain
http://www.youtube.com/watch?v=o-zoPgv_nYg
Lets see.... Nigeria. Oil, check. Print their own money, check. recently received US "advisors", check.
Standard CIA playbook is in place. Start with bribery, move to internal regime change and if they can't do it, call them terrorists andgo with an invasion.
The clock is ticking Nigeria.
ohh ...
nobody expects a spanish inquisition
Nigerian oil scam. I'm not falling for it.
It's an upside-down Nigarian 710 scam.
Did someone say "upside down Nigerian"? Name the time and place!!
Sincerely, Dominique Strauss Kahn
+69
You can run but we are going to fuck you in the face in another country too.
Who'd have thunk it?
Iran can't sell to the West due to sanctions and, coincidentally, the Nigerians suddenly decide to double oil prices to their own citizens, leading to production strikes.
What could be behind this totally unexpected upcoming hike in the baseline price for oil, do we wonder?
What's the next step? Venezuala suddenly announce that they're not selling their oil to the greedy capitalists, either, in solidarity with their great friends in the freedom loving country of Iran?
RUSSIA
Someone apparently left me a million barrels of Oil in Nigeria...so lucky i am.
Just send $50K in gold bars to cover the international transfer funding fee and the International I have been scammed tax.
Nigerian Bony Light, Ghanian Gold, I've lifted & settled both, what's all this "scam" stuff???
Actually engaging the obnoxious emailers can be as enjoyable as trapping the telemarketers in the conversation from hell. One of them made the mistake of using a return address in Switzerland- I never heard anything back though...
They're gonna sell it and send you a check, you just gotta immediately western union them a check back for ~5,000.00. GREAT DEAL!
Welp, looks like the media was wrong about their "ZOMG Dec shopping is strong". Now we have high oil prices and gas is rising quickly. 2012 is the year of the recovery...from the euphoria that has been pervasive the past couple of months.
Oh and gas went up $.20 over night here, and is up $.40 from the weekend.
*edit*Holy 10Y Batman!!
We'll see if the oil sword has finally run itself up the gut of the global economy and thus maxxed itself out insofar as economic destruction is concerned. I happen to believe we've had a glut of oil for sometime...perhaps even a decade actually...but geo political events have conspired to unleash a wave of speculation that has made oil over priced by perhaps up to 5 fold. We certainly know natural gas prices have collapsed...but who wants to save money by using that resource en masse? Talk about making all the conspriratorial talk seem valid...
I guess it's time for the prince of peace Obama to drop some humanitarian 500 pound bombs on the newly discovered Al Queda in Nigeria.
They're called Procul Harum or some such thing.
This is just the excuse for Oil to surge in price due to ALL the printing the Fed has been doing....... Uncle Ben can blame someone else for the inflation.
No worries. Look at natural gas, careening to world record lows,
When the "saber rattling" stops in Nigeria, Iran, etc.
Oil is going to go into a freefall.
And that will be another "tax cut" for the U.S. Consumer.
I still see RIG, DO, ECA, etc. grinding near 7-year lows, pricing in $45 crude and $2 natural gas.
Too deflationary Robo...WTI at $45 = S&P at 750
Natural gas will get to $2. Only commodity that trades supply/demand.
Crude will be lucky to see $75 this year.
At $45 count on the implosion of Russia and most mid-east countries (Saudi!!). Their break even on internal budgets is between $90-$100.
Also as $45 count on a $5T QEinfinity program.
Given the present burn rate for oil and the fact that natural gas does not even come close to filling all the roles of oil, I'll take that bet and raise you a freight train loaded with coal. What makes you think Russia and the mideast won't go to war? People still don't understand the thing like energy density and energy flux or entropy. Same as it ever was.
Perhaps you should supply some equations and comparison data, maybe some links to the pertinent poo...
If we are in Depression as most of you would agree, oil should be at $40 barrel.........
Yep, the bullshit continues to thicken.
http://upload.wikimedia.org/wikipedia/commons/8/87/Oil_Prices_1861_2007.svg
Patience, leafhopper.
"we" aren't what "we" used to be, and now face competition as consumers
Let's just remind ourselves that the magician himself, Bernanke, told us that a decline in oil prices is great for the US economy as it'll free up cash to spend elsewhere, but an increase is equally so, as people will buy less petrol.
In total terms; z=x*y, where x=price, y=quantity, z=total cost.
So what Benny really says, is that REGARDLESS of whether oil increases in price or not, the TOTAL COST spent on gasoline will fall! And that is regardless of what the current price is, as we've heard the lie at good few times by now!
That's Keynesianism you can take to the bank.
<vt/> Hello
Well S&P just upgraded country outlook to "positive". Because apparently civil war is good for a country. Must be the same sort of "postive" as France's AAA.
And it was just this time last year that Jim O'Neil picked Nigeria as one of likely top 20 contributors to global GDP. Included in that group was also Iran.
For dorks sometimes there is no better humor than reading sell side strategist's calls from a year ago.
American petro companies make more when prices skyrocket, why shouldn't the same be true for the NNPC?
And don't pick on Jimmy...he does the best he can with what nature gave him between his ears; it's not polite to laugh directly at the handicapped.
Gold back over $1650
Oil and gasoline coiled springs despite slack demand
This is boxing in the Fed--little room for fresh devaluation
But if they have to 'do something' or if the Euro strengthens, oil and gas To Da Moon....watch that DXY, it can't dip much below 80 or prices go boom.
Just as an FYI to folks, the way this plays in the world of domestic consumption is like so:
Domestic oil price subsidy explodes consumption. Period. Make oil cheap and it gets selected to solve all problems. But if you explode domestic consumption, then you eat into your exportable oil and consequent export revenue.
Iran, about 14 months ago, literally PAID their citizens to allow them to remove the oil subsidy so the domestic consumption would stop ramping up, eating away at their exportable totals (remember, Iran is well past Peak, which arrived in 1970s). A post Peak country cannot endure domestic explosions in consumption. They lose all their export revenue.
The poster child for this effect is Indonesia, which had to leave OPEC about 10 years ago when it ceased to export oil.
And so, Nigeria. They have a double whammy in place. They are going empty onshore and still have new discoveries offshore. The offshore money split of company vs country is less favorable to the country than onshore pumping. So it's really devastating to Nigeria government revenue to allow domestic consumption to ramp up. Hence, they gutted the subsidy and now the populace is pushing back.
So why not STOP exporting your oil? Oh, that's right, such a move would bring about Nigeria's "liberation" by NATO.
Oh, you don't know the half of it LoP guy, word is the companies offshore are diagonally drilling to tap the onshore fields from the offshore platforms. This gets the oil company the advantaged money split for pumping from offshore sources, vs onshore, which they drain out.
All of this conspires to create government desperation.
It's all going to unravel. Soon.
Do you have a date? It would really help with my hedges.
My date for that party is Meredith Whitney.
next wednesday
lol
I drink your milkshake, I drink it up.
+1 nice comment CIO!
Subsidizing domestic consumption is a ponzi entitlement program, unless the long-term price of oil goes down. Good luck with that in a world of competitive currency devaluations and stealth taxation through inflation.
let's carpet-bomb nigeria and bring democracy to them, hahaha, america, fuck yeah!!
Team America World Fleece
Goodluck Jonathan
Commencing AFRICOM drone-squad oil protection unit in 3,2,1..
Got bike?
Yet Obama decides to turn down Canadian Oil?!
Pandora Style Beads
I'd like to know what is going on behind the scenes. Things are not what they appear on their face. Anyone know the back story? I suspect that this is the scripted, gradual run-up of the price which will conveniently coincide with the looming war. There are some smart posters here...I'm looking for answers from the ZH "braintrust".
Nigeria recently announced they would be diversifying away from the dollar a little into yuan. They are setting up trade agrements directly with China.
The IMF commended Nigeria on cutting the subsidy. I'm not sure if the IMF requested the cut, or if the Nigerian gov't is just doing something the IMF likes. Either way, operating to the standards of the IMF certainly spells trouble for impoverished people of 3rd world nations.
the subsidy was costing a fortune and dollar imported inflation was costing another fortune
the tens of billions that China is investing the oil sector also helped the case, especially since China has offtake options on the 3 refineries they are builing to boost local supply
There's a big factual error in this post. The U.S. doesn't get anything close to 2.4 million barrels of oil a day from Nigeria - it doesn't even get that much from Canada, the U.S.'s top foreign supplier. Nigeria is 5th on the list of top U.S. suppliers, with about 800k barrels a day - a third of the amount cited. Proof: ftp://ftp.eia.doe.gov/pub/oil_gas/petroleum/data_publications/company_level_imports/current/import.html
I bet russia is really comfortable with getting a larger and larger monopoly over supplying oil to a rothchilds psychopath controlled europe.
Since the demand in the free world is always increasing, the local consumption needs to be suppressed in countries like Nigeria.
Either US citizens do the consuming or there is no consuming done.
US citizen saying of the day.
@my puppy for prez
A lot of ZH readers could use a dose of petroleum reality. Everthing you need to know about the looming petroleum global trainwreck can be found at 2:23:43 of Zeitgeist: Moving Forward - http://www.youtube.com/watch?v=4Z9WVZddH9w
Perhaps this is a great idea by the Nigerian government in an effort to try to keep some of their national resources back at home by "inciting" a nationwide oil "union strike" which would drag on indefinitely for regular "systematic shutdowns" to control the exports of their oil. This way they would not appear to be breaking the petro-dollar standard and end up like Iraq, Libya, etc.