Gas Exporting Countries Forum & Saudi Aramco
Posted by Ivo Cerckel on November 11th, 2009
The way most oil & gas is being sold by GECF and Aramco, their selling through the USA dollar, calls for a replacement. Chindia and euroland are showing the new way.
The Gas Exporting Countries Forum (GECF) was formally established in 2008.
Its members are Algeria, Bolivia, Brunei, Indonesia, Egypt, Iran, Libya, Malaysia, Nigeria, Qatar, Russia, UAE, Venezuela and Trinidad and Tobago.
Experts from the group’s members held a meeting in Doha, Qatar, on 09 and 10 November 2009, paving the way for the GECF ‘s ministerial gathering in Doha on 09 December 2009, where the organisation’s secretary general will be appointed, its permanent secretariat headquarters will be inaugurated, and gas prices in international markets will be discussed. (1)
Some industry analysts have described it as the “gas OPEC.” But the way most gas is sold — through long-term contracts — limits the extent to which it can mimic OPEC’s practice of coordinating production levels among its members. (2)
The Times reported last week that Saudi Aramco was also experiencing “dollar problems” due to the way most of Aramco’s oil is sold to the USA. The Saudis don’t trade oil but historically sell it at fixed discounts to West Texas Intermediate (WTI), set in advance. With WTI bouncing around, the Saudis cannot price their oil competitively against rival sour crudes. Customers are annoyed; by the time that cargoes arrive from Arabia, WTI’s oscillations could make Saudi crude dirt cheap or horribly dear. (3)
The euro is the first currency that has not only SEVERED ITS LINK to gold, but also its link to the nation-state, said the late European Central Bank president Wim Duisenberg on 9 May 2002. (4)
Lorenzo Bini Smaghi, a board member of the same ECB, said on, 06 October 2009, that China for one needs to bite bullet. “I think the best way is that China starts adopting its own monetary policy and DETACH itself from the Fed’s policy.” (5)
India is buying gold (6) and is selling USA T-bills to that effect. (7)
Chindia is following the euro’s example.
The USA dollar is toast.
Hence, the Gas Exporting Countries Forum and Saudi Aramco need a replacement.
Chindia and euroland are showing the way.
Ivo Cerckel
honestmoney@maktoob.com
http://twitter.com/ivocerckel/
NOTES
(1)
Leading gas producers to meet in Doha
Wed, 04 Nov 2009 07:36:17 GMT
http://www.presstv.ir/detail.aspx?id=110409§ionid=3510213
(2)
Gas exporters’ forum should mimic OPEC: Algeria
Tue Nov 10, 2009 2:47pm GMT
http://af.reuters.com/article/investingNews/idAFJOE5A90IV20091110
(3)
From The Times November 4, 2009
Saudi Aramco seeks solution to crude problem
Carl Mortished: World business briefing
http://business.timesonline.co.uk/tol/business/columnists/article6901552.ece
discussed by yours truly here:
Incoterms or dollar? Re: Saudi Aramco US sales
Posted by Ivo Cerckel on November 4th, 2009
http://bphouse.com/honest_money/2009/11/04/incoterms-or-dollar-re-saudi-aramco-us-sales/
(4)
International Charlemagne Prize of Aachen for 2002
Acceptance speech by Dr. Willem F. Duisenberg, President of the European Central Bank, Aachen, 9 May 2002
http://www.ecb.eu/press/key/date/2002/html/sp020509.en.html
(5)
China calls time on dollar hegemony
You can date the end of dollar hegemony from China’s decision last month to sell its first batch of sovereign bonds in Chinese yuan to foreigners.
By Ambrose Evans-Pritchard
Published: 7:33PM BST 06 Oct 2009
http://www.telegraph.co.uk/finance/china-business/6266790/China-calls-time-on-dollar-hegemony
(6)
India Buys IMF Gold to Boost Reserves as Dollar Drops (Update2)
By Thomas Kutty Abraham and Kim Kyoungwha
Nov. 3 (Bloomberg)
http://www.bloomberg.com/apps/news?pid=20601091&sid=aa6oc6Wz9Ftg
(7)
RBI may’ve sold US T-bills to buy gold – The Economic Times
7 Nov 2009, 0217 hrs IST, ET Bureau
http://economictimes.indiatimes.com/news/economy/finance/RBI-mayve-sold-US-T-bills-to-buy-gold/articleshow/5205038.cms
No related posts.
November 12th, 2009 at 07:42
Hi Ivo,
We need to put this Peter J Cooper guy on his place!
His latest gold article actually bashes physical gold owners and advocated gold ETF’s. Please comment on the article to tell him your thougts!
http://arabianmoney.net/2009/11/11/dubai-gold-heist-highlights-value-of-etfs-and-vaults/
Best regards!
Jeroen
November 12th, 2009 at 10:00
Mr Cooper,
Since Aristotle, there is something like the principle of non-contradiction (PNC) which says that it is impossible to be and not to be at the same time and in the same respect.
This principle is only applicable to human thought, not, as many authors argue, to reality.(Fernand Van Steenberghen, (F-X De Guibert, éd.), “Philosophie fondamentale”, Longueuil, Québec, Editions du Préambule, 1989, p. 296 note)
On the hand, you are saying that the Dubai Gold SECURITIES exchange traded fund is the perfect local solution. On the other hand, you are saying that PHYSICAL gold can be stored at the Perth Mint Depository System.
The applicability of the PNC to thought only explains why you can still get away with this apparent contradiction.
Indeed, the contradiction (securities vs. physical gold) is only apparent. You are stressing that the gold which would be stored at the Perth Mint Depository System is UNALLOCATED.
Now, do you want your readers to invest in physical gold or in paper?
You conclude that the place to keep gold is in a vault and you urge your readers not to carry it around in their luggage.
Carry around what?
At the Dubai Gold Securities exchange, it is only paper. At the Perth Mint Depository System it is unallocated. In neither case do your readers own a physical ounce of gold.
How could your readers carry that no-gold around in their luggage?
Ivo Cerckel
November 12th, 2009 at 13:10
MR COOPER REPLIES ON HIS WEBSITE;
Ed Note: Philosophy apart, yes in both the PMDS and DGS scheme you do own physical gold – what do you think you are holding? Plastic Bags? The issue here is security, and having gold in your at home is not secure – do you disagree? Perhaps you have Fort Knox in your basement – but that would be an even bigger security risk, would it not?
IVO CONTINUES:
Mr Cooper says:
The issue here is security, and having gold in your at home is not secure – do you disagree?
and said before:
Perth Mint Depository System in Australia from a AAA-rated, 100 per cent government owned institution
I, Ivo, disagree that guv’mint can provide security.
Guv’mint rests on taxation and the difference between taxation and theft is that the thief does not come back (return?) periodically nor does she pretend to be stealing in the public interest
AND IVO CONFIRMS
At the Dubai Gold SECURITIES exchange, one can only own securities.
At the Perth Mint Depository System, the metal is unallocated.
In both cases, you have only your paper. No metal whatsoever.
Is paper secure?
Yes, the banksters will tell you that having a claim to something means possessing the real thing.
It’s policies such as those Mr Cooper is advocating which have led to Fort Knox being empty now.
November 12th, 2009 at 13:27
Mr Cooper trusts guv’mint bureaucrats and lawyers.
IN REPLY TO:
What prevents the DGS from leasing the gold bar allocated to your ETF?
MR COOPER SAYS:
Ed Note: DGS no longer legally owns the gold so of course it can not lease it out. I sat with their lawyer and went through the entire sale process and believe me this would be illegal. Why would officials with nothing to gain do this knowing it to be illegal? You have to come up with a pretty convincing conspiracy theory to make this charge.