You are here
MiningMX interviews Bill Murphy and Murray Pollitt
Ahmadinejad: Oil Price Is Lower Than Value
By Nasser Karimi
Associated Press
Thursday, April 20, 2006
http://news.yahoo.com/s/ap/20060420/ap_on_re_mi_ea/iran_oil
Wading into oil politics for the first time, Iran's hard-line
president said Wednesday that crude oil prices -- now at record
levels -- still are below their true value.
In statements likely to rattle world oil markets, President Mahmoud
Ahmadinejad also said developed countries, not producing countries
like Iran, are benefiting the most from the current high prices.
"The global oil price has not reached its real value yet. The
products derived from crude oil are sold at prices dozens of times
higher than those charged by oil-producing countries," state-run
Tehran radio quoted Ahmadinejad as saying.
"The developed nations are the biggest beneficiary of the added
value of oil products," he said.
The president, who is embroiled with the West and the United Nations
over Tehran's nuclear program, stopped short of saying Iran would
use oil as a weapon, a tactic much feared by his antagonists on the
nuclear issue. Nor did he say what oil prices should be.
Oil prices leapt above $72 a barrel Wednesday, settling at a record
high for the third straight day.
"The products derived from crude oil cost over 10 times the price of
oil sold by producing states. Developed and powerful countries
benefit more from its value added than any party," Ahmadinejad said.
Oil prices should be determined on the basis of market supply and
demand, the Iranian leader said.
"Oil is the major asset of nations possessing it. Its price should
not be lowered on the pretext that it will prove harmful to
developing states, thus permitting the world powers to benefit the
most from it," he said.
George Orwel, an analyst at the New York-based Petroleum
Intelligence Weekly, said he thought Ahmadinejad was playing the oil
card to resist pressure over Iran's nuclear program.
"They are using the oil as a political football. Every time there's
an issue with Iran, the oil market freaks out," he said in a
telephone interview.
Earlier this week, as oil prices pushed above $70 a barrel, ABN Amro
broker Lee Fader said the trigger was heightened fear about U.S.
military action against Iran, which has said it would go ahead with
plans to enrich uranium in defiance of the United States, Europe and
the U.N. nuclear agency.
Iran says its nuclear ambitions are peaceful, but the West fears it
is intent on arming itself with nuclear weapons.
If the United States were to attack Iran, Tehran might try to
cripple the world economy by putting a stranglehold on the oil that
moves through the Strait of Hormuz -- a narrow, strategically
important waterway running to Iran's south.
While discounting Ahmadinejad's seriousness in his Wednesday
comments about the value of oil, Orwel conceded that the oil
industry could not do without the 2.5 million barrels that Iran
exports daily.
"Ahmadinejad is trying to show his muscle so that the Bush
administration can realize the consequences on the oil market of
further confrontation with Iran," Orwel said, adding that he fully
expected Iran to threaten to cut off oil if the confrontation with
the West continued.
While Ahmadinejad did not say he would use oil as a weapon in his
dispute with the West, Interior Minister Mostafa Pourmohammadi said
last month the oil card was in play.
"If (they) politicize our nuclear case, we will use any means. We
are rich in energy resources. We have control over the biggest and
the most sensitive energy route of the world," he said, referring to
the Straits of Hormuz.
In keeping with Iranian leaders' tendency of late to contradict
themselves, Foreign Minister Manouchehr Mottaki later denied Iran
would adopt such a policy.
Iran is the world's fourth-largest oil-producing country and the
second in OPEC.
Ahmadinejad urged oil-producing countries -- within and outside the
Organization of Petroleum Exporting Countries -- to establish a fund
to help alleviate the pressure resulting from high oil prices on
Third World nations.
Oppenheimer & Co. oil analyst Fadel Gheit said he considered it
unlikely that Iran had any intention of cutting off its oil, the
lifeline of its economy.
Gheit noted, however, that there was some truth in Ahmadinejad's
comment on developed countries benefiting most from increased oil
prices, though the statement would likely be seen as an attempt
at "fanning the flames" of a red-hot oil market.
"What he's saying makes a lot of sense. Unfortunately, the source of
the comment is going to send jitters in the market," Gheit said.
"The street value (of oil) is triple what OPEC is making," Gheit
added, referring to the value of a barrel of gasoline versus the
value of a barrel of oil.
Gheit estimated that in London, where the retail price of gasoline
is about $6 a gallon, about $150 worth of gasoline can be made and
sold from every $50 barrel of oil.
"That is why Exxon Mobil and all the rest make so much money," he
said.
----------------------------------------------------
To subscribe to GATA's dispatches, send an e-mail to:
gata-subscribe@yahoogroups.com
To unsubscribe, send an e-mail to:
gata-unsubscribe@yahoogroups.com
Caution: America Online prohibits delivery of GATA
dispatches to AOL e-mailboxes.
----------------------------------------------------
RECOMMENDED INTERNET SITES
FOR DAILY MONITORING OF GOLD
AND PRECIOUS METALS
NEWS AND ANALYSIS
Free sites:
http://www.cbs.marketwatch.com
http://www.usagold.com/amk/usagoldmarketupdate.html
http://www.capitalupdates.com/
http://www.silver-investor.com
http://www.thebulliondesk.com/
http://www.goldismoney.info/index.html
http://www.minersmanual.com/minernews.html
http://www.a1-guide-to-gold-investments.com/euro-vs-dollar.html
http://www.investmentrarities.com
http://www.kereport.com
(Korelin Business Report -- audio)
http://www.plata.com.mx/plata/home.htm
(In Spanish)
http://www.plata.com.mx/plata/plata/english.htm
(In English)
http://www.resourceinvestor.com
http://www.goldpennystocks.com/
Subscription sites:
http://www.lemetropolecafe.com/
http://www.interventionalanalysis.com
http://www.investmentindicators.com/
Eagle Ranch discussion site:
http://os2eagle.net/checksum.htm
Ted Butler silver commentary archive:
http://www.investmentrarities.com/
----------------------------------------------------
COIN AND PRECIOUS METALS DEALERS
WHO HAVE SUPPORTED GATA
AND BEEN RECOMMENDED
BY OUR MEMBERS
Blanchard & Co. Inc.
909 Poydras St., Suite 1900
New Orleans, Louisiana 70112
888-413-4653
http://www.blanchardonline.com
Centennial Precious Metals
Box 460009
Denver, Colorado 80246-0009
1-800-869-5115
http://www.USAGOLD.com
Michael Kosares, Proprietor
cpm@usagold.com
Colorado Gold
222 South 5th St.
Montrose, Colorado 81401
http://www.ColoradoGold.com
Don Stott, Proprietor
1-888-786-8822
Gold@gwe.net
El Dorado Discount Gold
Box 11296
Glendale, Arizona 85316
http://www.eldoradogold.net
Harvey Gordin, President
Office: 623-434-3322
Mobile: 602-228-8203
harvey@eldoradogold.net
Gold & Silver Investments Ltd.
Mespil House
37 Adelaide Rd
Dublin 2
Ireland
+353 1 2315260/6
Fax: +353 1 2315202
http://www.goldinvestments.org
info@gold.ie
Investment Rarities Inc.
7850 Metro Parkway
Minneapolis, Minnesota 55425
http://www.gloomdoom.com
Greg Westgaard, Sales Manager
1-800-328-1860, Ext. 8889
gwestgaard@investmentrarities.com
Kitco
178 West Service Road
Champlain, N.Y. 12919
Toll Free:1-877-775-4826
Fax: 518-298-3457
and
620 Cathcart, Suite 900
Montreal, Quebec H3B 1M1
Canada
Toll-free:1-800-363-7053
Fax: 514-875-6484
http://www.kitco.com
Lee Certified Coins
P.O. Box 1045
454 Daniel Webster Highway
Merrimack, New Hampshire 03054
http://www.certifiedcoins.com
Ed Lee, Proprietor
1-800-835-6000
leecoins@aol.com
Lone Star Silver Exchange
1702 S. Highway 121
Suite 607-111
Lewisville, Texas 75067
214-632-8869
http://www.discountsilverclub.com
MRCS Canada
12303-118 Ave. NW
Edmonton, Alberta T5L 2K2
Canada
http://www.mrcscanada.com
Michael Riedel, Proprietor
1-877-TRY-MRCS
1-877-879-6727
mrcscanada@shaw.ca
Miles Franklin Ltd.
3015 Ottawa Ave. South
St. Louis Park, Minn. 55416
1-800-822-8080 / 952-929-1129
fax: 952-925-0143
http://www.milesfranklin.com
Contacts: David Schectman,
Andy Schectman, and Bob Sichel
Missouri Coin Co.
11742 Manchester Road
St. Louis, MO 63131-4614
info@mocoin.com
314-965-9797
1-800-280-9797
http://www.mocoin.com
Resource Consultants Inc.
6139 South Rural Road
Suite 103
Tempe, Arizona 85283-2929
Pat Gorman, Proprietor
1-800-494-4149, 480-820-5877
Metalguys@aol.com
http://www.buysilvernow.com
Richard Nachbar Rare Coins
5820 Main St., Suite 601
Williamsville, N.Y. 14221-8232
877-622-4227
http://www.CoinExpert.com
nachbar@coinexpert.com
Swiss America Trading Corp.
15018 North Tatum Blvd.
Phoenix, Arizona 85032
http://www.swissamerica.com
Dr. Fred I. Goldstein, Senior Broker
1-800-BUY-COIN
FiGoldstein@swissamerica.com
The Moneychanger
Box 178
Westpoint, Tennessee 38486
http://www.the-moneychanger.com
Franklin Sanders
1-888-218-9226, 931-766-6066
----------------------------------------------------
HOW TO HELP GATA
If you benefit from GATA's dispatches, please
consider making a financial contribution to
GATA. We welcome contributions as follows.
By check:
Gold Anti-Trust Action Committee Inc.
c/o Chris Powell, Secretary/Treasurer
7 Villa Louisa Road
Manchester, CT 06043-7541
USA
By credit card (MasterCard, Visa, and
Discover) over the Internet:
http://www.gata.org/creditcard.html
By GoldMoney:
http://www.GoldMoney.com
Gold Anti-Trust Action Committee Inc.
Holding number 50-08-58-L
Donors of $200 or more will receive copies
of "The ABCs of Gold Investing" by Michael
Kosares, proprietor of Centennial Precious
Metals in Denver, Colorado, and "The Coming
Collapse of the Dollar" by James Turk and
John Rubino.
GATA is a civil rights and educational
organization under the U.S. Internal Revenue
Code and contributions to it are tax-deductible
in the United States.
