10 January 2014

US to un lift crude oil export ban soon?

According to Bloomberg, the crude oil production in US is increased thanks to the advanced technology that could drill on the rocks. Some experts forecast that US could be the #1 oil producer by near future which will change the whole game. 

To me, I believe it would not be easily implemented as few parties are involved here, especially current players that already have leading position. It may become a political debate as the ban started since 1970s is to help to overcome the crude oil crisis when the crude oil price peaked for a few more time above the previous level and had caused a very serious inflation issue and economy crisis. 

So what would be the best idea now? I understand that subsea drilling sector might be affected on this. The Middle East & North Africa, the world's largest production area too will be negatively impacted. However, it's good that we can monitor it closely before we could come to a conclusion. 

So far, I understood that Keppel Corp is In a midst of challenging Korea leadership in drilling ship technology by designing a better product in a hope to lure more new customers. SembMarine is now still finding it's ways out in Brazil's rig building progress as more resources to be put on there for workers training. Yang Zi Jiang is now in near full production capacity, so I would not be surprised if it switch it's focus in its top priority in the most "hands-on" ship building sector. 

Nonetheless, I believe the commodities price may not as high as for the past 10 years when commodities started to rise. Advanced technology as well as better utility of farm lands and so called "water cleaning" will help to reduce the negative impact of climate change & demographic change. Urbanization and globalization will help more residents to get lower price. Of cause, this is just my guess for next few years. I would still invest in plantation / mining counters when opportunity arises. 

1 comment:

  1. Greetings,

    Dated January 12, 2014, the Indonesian government will enact legislation to ban the export of Indonesian miners mine in the form of raw materials. Indonesia is one country rich source of natural resources, such as mining and large contribute to the needs of mining in the world. It can indirectly lead mines commodity prices in world trade, particularly certain minerals, while suply reduced, e.g. tin, except for those who already have smelters, while it is still not much.

    And for me, in addition to mine, may be considered by the oil and gas, and I believe that each country will have a problem of energy crisis, it means they will secure various forms of oil and gas and mining as an alternative energy source, if necessary, as a "key" state strategic.

    Robin Setiawan
    PT. Valbury Asia Securities, Indonesia


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