Topic: WHY THE OIL COMPANIES ARE SLOW IN EMPLOYMENT....READ THIS

Hello house,

I am sure most of us are aware of the oil price slump that is currently hitting hard on the oil companies.It might interest those of you who aren't aware to know that this is one of the reasons why most oil companies are making recruitment in their companies vague.

Below are some information that may keep u updated about these happenings. You will also find out what is responsible for the slump in oil price below.

I strongly believe that only prayer can save us from all these.God is not silent to our situations.




Oil prices have fallen for the sixth consecutive dayFont Size: Decrease Increase Print Page: Print Cath Hart | January 14, 2009
Article from: The Australian
LACKLUSTRE demand and burgeoning energy stockpiles in the US have driven down oil prices for the sixth consecutive day.

It also dragged the price of crude below $US38 a barrel.

Trade on the New York Mercantile Exchange yesterday saw the price of light sweet crude for delivery in February fall to $US37.96, a world away from the record high of $US150 set in June last year. It fell to $US36.50 in Singapore yesterday.

Although escalating tensions in the Middle East recently sparked a brief rally in the oil price, analysts said that weak economic data had focused market attention on the possibility of recession rather than the potential for the conflict to tighten demand.

Trading over the past six days has seen the price of crude oil fall by 24 per cent.

It hit a four-year low of $US32.40 on December 19.

While the price slump has sparked more belt-tightening among companies and governments already shell-shocked by the credit crunch, consumers have breathed a sigh of relief as respite at the bowser reduces pressure on household budgets.

The national average retail petrol price last week fell 1.6c to 103.1c per litre, while the retail price of diesel fell 2.1c to 128.1c per litre, according to the Australian Institute of Petroleum.

In contrast, Kuwait, OPEC's third-largest producer, yesterday revealed it would slash government spending from April after the the oil-rich nation's central bank confirmed that revenue from oil had more than halved.

Analyst Peter Strachan, the author of the StockAnalysis report, said the oil price had been driven down by dramatic declines in demand of more than 6 per cent per day.

"The demand destruction began last year with the impact of high oil prices has continued as global industrial production plunges as a result of the global financial crisis," he said.

OPEC's production cuts had failed to stop a continuing rise in inventories, indicating that the consequences of the ongoing price slump would include further OPEC cuts, he said.

"Globally, oil companies are shutting up their development plans and deferring or cancelling exploration drilling," Mr Strachan said.

"Service companies, such as Halliburton and Stumberger, are laying of staff as work evaporates -- eventually, non-OPEC production will fall, under the influence of a lack of development drilling and deferral of new projects, but you will not see the impact of this of production until the September quarter," Mr Strachan added.

Smaller oil and gas companies will fail as a result, leaving "bargains for companies with cash", he said.

Deutsche Bank energy analyst John Hirjee said he was not expecting the oil price to rally this year.

"For the 2009 calender year we're expecting the West Texas Intermediate oil price to average $US45 a barrel," Mr Hirjee said.

"We do see the possibility of oil prices touching around $US30 a barrel, but they won't be there long because there will be a supply response."

Mr Hirjee said companies would be budgeting for an oil price of $US40-$US60 a barrel when planning projects.

Recent analysis by Deutsche Bank found that Queensland's emerging coal seam gas sector was particularly tolerant of lower oil prices.

"The contracting and services sector will be impacted and we will see an increase in mergers and acquisitions because asset prices are so much cheaper," Mr Hirjee said.

"One thing we think will be reviewed will be exploration budgets."



WHAT IS RESPONSIBLE FOR THE OIL PRICE SLUMP?

Blog

2008 oil recap. and what is next by Steve Austin - 2009/01/05

It took only 5 months for the price of oil to plummet from $150 to under $40 in the second part of the year. Meanwhile oil consumption did not even decrease 10%, so what is the real cause of this collapse you may ask?
Hedge funds. Let me explain.

During the first part of 2008, Western economies were already slowing down noticeably and hedge funds gradually pulled trillions of dollars out of the market and parked them in energy ETFs. At the time Chindia's insatiable thirst for oil and the "decoupling" of east/west economies had many believe commodities were a "sure thing", a sound enough tangible insurance to protect overinflated assets scavenged from made-up bubbles. On top of that, by using leverage, profits were multiplied as oil went up, not a bad deal in a recession.
But when the banking industry collapsed, hedge funds had to raise cash by "deleveraging", liquidating their leveraged energy ETF positions sending the price of oil tumbling. Anecdotally shorting of banking ETFs was suspended by the US Securities Commission during that time but not shorting of energy prices, and the leverage mania soon found an escape route in utrashort oil ETFs, compounding the speed of this downward spiral. By December 2008 the oil price had collapsed 75% and frankly, who would complain about cheap gas these days?
As we enter 2009 the oil landscape has reversed dramatically from a year ago. The price of oil is lower than production costs and new exploration projects are being cancelled. China flush with cash is currently buying all the oil it can get its hands on to pump into its strategic reserves. Once arrogant OPEC countries are willing to sell oil at any price to fund government programs and prevent political instability.
One constant however is the depletion of major oil fields, worse than predicted at 9.1% year over year as we close 2008. It's a matter of when not if the economy recovers and when it does, expect a strong bounce back in the price of oil.


God dey.
Cheers guy.

Very correct!!

I pray this useless trend does not continue oooo.