On Fri, Nov 21, 2008 at 1:02 PM, Kenfish wrote:

Bwana Amenya;

Oil is sold in futures markets, so is everything else sold on Wall Street as futures, including development aid to a poor country like ours. These are not ordinary people, but people who speculate day and night, selling nothing but pure hype. Real sales take place at Abu Dhabi, UAE, Saudi Arabia, Main Street etc, and is dictated by what takes place on the futures market. The futures markets act as demand and supply barometers, where more demand increases price, and more supply suppresses price increases. Kitaambo, for oil, it was OPEC that used to dictate such tasks.

Now oil in Kenya is imported once a month by tender, currently, the most expensive marketer, Kenol Kobil (you know who owns it), is holding the tender document. Thats why the price won’t go down any time soon. December is here and we are expected to have another delivery of crude, and with pirates hijacking ships off our coastline, what do you expect?

Oil is now below US $48, the lowest since 2004, although some rebound happened this morning, but since we are in the middle of a recession, and we are going down I don’t know until when, the price of crude will continue a downward spiral regardless of oil supply cuts. Until the economic fundamentals are clear. No one is sure how deep this thing will go, how many jobs will be lost, and how many companies will go under. Signs are that many companies will be gone by March next year, the deepest trough of this recession.

Then some pundits will tell you how much oil will cost. Oil companies have to lower their prices because oil in Kenya is imported monthly. We are now using October 2008 stock since we can’t store enough oil for a year. That’s how poor we have become. Nchi ya kadogo.

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Kenfish

You are right. Do you remember when people were fighting in Kenya, oil firms said they were running out of fuel. You remember even in Mombassa where the refineries are said they were running out of fuel. That was just a 3 weeks fight. What nonesense is someone telling you that the oil they are using was imported in December?

Alai

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Date: Fri, 21 Nov 2008 13:09:19 +0300 [11/21/2008 04:09:19 AM CST]
From: Robert Alai
Subject: Oil and Markets

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I’m afraid we are barking up the wrong tree. Oil companies in Kenya get 46ksh per litre of petrol yet they have to source for their oil and pay “refining” charges etc etc…They honestly cant take it any lower!!!! If you want the oil prices to change allow them to import refined products and cut down on the ridiculous tax..Else its not profitable to do business in Kenya, thats why corporates like exonmobil (Caltex) Mobil etc have closed shop and more are shipping out next year.

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Date: Fri, 21 Nov 2008 14:08:18 +0300 [11/21/2008 05:08:18 AM CST]
From: john maina
Subject: Re: Oil and Markets

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So why do price increases reflect immediately???\

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Date: Fri, 21 Nov 2008 17:06:49 +0300 [11/21/2008 08:06:49 AM CST]
From: martin kiiru
Subject: Re: Oil Prices Why they will not drop first

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Kenfish
if the oil business was as profitable as you guys make it sound then care to explain why all the big players are selling out and hitting the road?Lets give ourselves an assignment lets all find out how much tax the govt collects in taxes from oil companies, you will be shocked with the results.

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Date: Fri, 21 Nov 2008 17:49:03 +0300 [11/21/2008 08:49:03 AM CST]
From: john maina
Subject: Re: Oil and Markets

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guys for your info, a few ministers, including those charged with controling oil companies have their wives and sons importing 35% of crude in the country.

you can wait forever for prices to come down or get controlled.

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Date: Fri, 21 Nov 2008 15:44:20 +0000 [11/21/2008 09:44:20 AM CST]
From: jude ogulla [United Kingdom]
Subject: Re: Oil and Markets: ministers are involved in the business