Saturday 4 June 2011
Gold hangs on to gains
Gold hangs on to gains
June 4, 2011 - 7:20AM
15 Reasons to buy Gold
Wealthdaily.com/Gold_Report
Gold, two steps ahead: how the rich keep getting richer. New gold rpt
Gold held onto modest gains on Friday after jumping to a two-day high when the US dollar tumbled after a soft monthly labour report showed the US economy created far fewer jobs than expected in May.
Spot gold rose to a two-day peak of $US1546.39 a troy ounce, then pulled back to $US1541.44 in late US trade, still up from $US1532.55 an ounce late in New York on Thursday.
Gold hit a record high of $US1575.79 on May 2.
Gold priced in sterling hit a record high of 946.79 pounds ($US1548) an ounce, as a weaker dollar across a basket of currencies triggered a rush for the precious metal.
The euro's gains accelerated against the US dollar, taking out a resistance level that could result in further gains for the euro zone single currency. Investors bet against the greenback after a bleak US payrolls report added to evidence of a marked slowdown in the economic recovery.
US employers hired far fewer workers than expected in May and the unemployment rate rose to 9.1 per cent. Nonfarm payrolls rose 54,000 last month, the weakest reading since September, and the jobless rate went up as high energy prices and the effects of Japan's earthquake bogged down economic growth.
Read more: http://www.watoday.com.au/business/markets/gold-hangs-on-to-gains-20110604-1flt3.html#ixzz1OGRc0BQ6
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
The Next Huge Oil Spike
The Next Huge Oil Spike
June 3, 2011
Oil prices are now hovering near $100, now that the world seems relatively stable: Egypt and Libya are out of the news, Osama bin Laden is dead, and Iranian President Mahmoud Ahmadinejad will not be chairing the next OPEC meeting. However, sky-high oil prices are not as far off as you may think. Sparks flying among the large Middle Eastern oil-producing nations could send prices soaring for years to come.
Two weeks ago, my colleague David Lee Smith warned Fools to carefully watch the story unfolding in the Middle East. Should the U.S. leave Iraq in December, Iran and Saudi Arabia could begin to vie for power and influence in the region. Iran has been active in trying to influence the region recently, and Saudi Arabia and other countries are getting antsy. Just last week, The Wall Street Journal reported that Saudi officials have been talking with other Muslim nations to join an informal Arab alliance against Iran. Some analysts worry that more nations could be pulled into troubles between the two Arab powers.
Why this matters
Let's examine the historical data:
Country | Year | Event | Pre-Event Production (MMB/d) | Production Low Point (MBB/d) | Recovery Level (MMB/d) | Years to Recovery |
|---|---|---|---|---|---|---|
| Iran | 1979 | Revolution | 6.0 | 1.3 | 3.5 | 15 |
| Iraq | 1980 | Iran-War | 3.5 | 1.0 | 3.0 | 10 |
| U.S.S.R. | 1989 | Collapse | 12.0 | 6.0 | 10.1 | 20 |
| Iraq | 1990 | Gulf War | 3.0 | 0.5 | 2.5 | 10 |
| Venezuela | 2002 | PDVSA strike | 2.8 | 1.2 | 2.6 | 9 |
| Iraq | 2003 | Invasion | 2.5 | 1.4 | 2.5 | 8 |
| Libya | 2011 | Revolution | 1.6 | ~0.4 | - | - |
Source: ARC Financial, U.S. Energy Information Administration.
Why this happensIn any war-like situation, you might expect pipelines, wells, and other necessary infrastructure to be destroyed. However, the damage is much broader. The "brain-drain" of experienced workers fleeing the country is a large factor in the loss of production. Skilled workers aren't apt to quickly return, and replacements are hard to come by for a country that has just (in the past five years) gone through chaos.
Beyond that, functioning governments take time to rebuild, and money for new projects is hard to find, as investors demand huge returns for the high perceived risk of the nation. It took nearly seven years for the Iraqi government to auction off some of its oil fields to ExxonMobil (NYSE:XOM ) , Royal Dutch Shell (NYSE: RDS-B ) , and BP (NYSE: BP ) and that was with the U.S. working feverishly to protect Iraq's oil assets during the war. I doubt you will see Total(NYSE: TOT ) or ConocoPhillips (NYSE: COP ) returning to Libya anytime soon after losing most of their investment in the country
Country | Current Production | Low Point? |
|---|---|---|
| Saudi Arabia | 10.5 MMB/d | ? |
| Iran | 4.2MMB/d | ? |
| Iraq | 2.5MMB/d | ? |
Source: U.S. EIA.
Related Tickers
| BP | $44.63 |  | -0.37 | -0.82% |
| BP plc (ADR) | CAPS Rating:  | |||
| COP | $72.39 |  | +0.24 | +0.33% |
| ConocoPhillips | CAPS Rating:  | |||
| RDS-B | $70.34 | | -0.07 | -0.10% |
| Royal Dutch Shell | CAPS Rating: | |||
| TOT | $55.83 | | -0.40 | -0.71% |
| Total SA. (ADR) | CAPS Rating: | |||
| XOM | $81.18 | | -0.15 | -0.18% |
| ExxonMobil Corp | CAPS Rating: | |||
All information on this website is for educational purposes only and is not intended to provide financial advise. Any statements about profits or income, expressed or implied, does not represent a guarantee. Your actual trading may result in losses as no trading system is guaranteed. You accept full responsibilities for your actions, trades, profit or loss, and agree to hold MinKL Invest harmless in any and all ways.
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