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Oil producers, users dispute price crisis ahead of summit  

by Laura Bonilla 2 hours, 15 minutes ago

JEDDAH, Saudi Arabia (AFP) - Oil powers and consumer nations haggled Saturday over who is to blame for the spectacular rise in crude prices, as they prepared for a summit in Saudi Arabia on the global energy crisis.

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Amid growing pressure for international action as prices speed toward 140 dollars a barrel, the industry was rocked by more bad news when a Nigerian rebel group warned all foreign workers to leave the country or face attack.

The Jeddah Energy Meeting was to consider ways of ending oil price pressures, which have fuelled global inflation.

Growing demand and the need for greater investment in refining have been highlighted, but some nations want the summit to blame the price rises on market funds buying oil futures.

And a working paper for the summit's final declaration, obtained by AFP, calls for action to "improve the transparency and regulation of financial markets through measures to capture more data on index fund activity and to examine cross exchange inter-actions in the crude market."

A senior international energy official involved in the summit called the document "highly controversial" because of the attack on markets.

The document says index funds and other investors have "unrealistic assessments" of the future value of oil.

The official said the attack may be toned down in the final document because of opposition from the United States and other major industrial powers.

Major oil producing powers have sought to divert consumer calls for greater production, even though Saudi Arabia was expected to offer to pump an extra 200,000 barrels a day at the summit.

German Economy Minister Michael Glos has called for a quick increase in oil supplies.

"We need more oil in the world market quickly in order to stop the spiralling prices at the gas pumps," which have passed a "limit" which consumers cannot bear, the minister wrote in an article to appear in the Sunday newspaper Bild am Sonntag.

"Transparency in the international oil markets must be improved. It is the only way to get out of this speculative morass," he wrote.

Increased production is is opposed by many oil powers. Organisation of Oil Exporting Countries president Chakib Khelil asked Friday, "just because car and computer prices were high, would one ask their producers to make more?"

The summit document calls for improved information gathering by groups such as OPEC, the International Energy Agency (IEA) and the International Energy Forum (IEF) "to improve transparency."

It also appeals for an assessment of "the impact of financial markets on the level, volatility of oil prices which can be used to better understand the market situation."

The draft says increased refining capacity is needed, with new construction having been shackled by "constrained refining investment, environmental standards, cost inflation and stringent laws and regulations, resulting in poorer refining returns."

British Prime Minister Gordon Brown, who will be the only major Western leader at the summit, has insisted he was not going to simply urge increased supply but urge producer countries to invest more in renewable energy.

"I am going to Saudi to see if we can get a new deal between oil producers and the consumers where oil producers will invest in countries like ours, and oil consumers like us with good companies, with good technology and skills can invest in the oil-producing countries," he told The Guardian newspaper in an interview published Saturday.

"Where we can make credible commitments and the world can see we will reduce our dependence on oil and we will get demand and supply back into balance."

Brown said the world was going through "the biggest of all three oil shocks" which was "the downside of globalisation".

He predicted that "the world is going to have to build 1,000 nuclear power stations."

The meeting is also to be attended by Chinese Vice President Xi Jinping and US Energy Secretary Samuel Bodman.



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Home arrow Blog arrow Mark Cuban charged with insider trading
Mark Cuban charged with insider trading PDF Print E-mail
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Monday, 17 November 2008

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 Billionaire entrepreneur Mark Cuban, owner of the National Basketball Association's Dallas Mavericks, was charged Monday by the Securities and Exchange Commission with insider trading.

According to the SEC, Cuban sold 600,000 shares of Internet search company Mamma.com in June 2004 using non-public information.

Cuban is accused of calling his broker and instructing him to sell all of his stock from Mamma.com after receiving the confidential information from the company.

The SEC said Cuban learned that the company would raise money through a public offering, and he knew the stock price was about to fall.

When the offering was made public, the stock fell 9.3%, and Cuban avoided losses in excess of $750,000 by selling stock the day before, the SEC report said.

"I am disappointed that the Commission chose to bring this case based upon its Enforcement staff's win-at-any-cost ambitions," said Cuban in a statement released by his legal counsel, Dewey & LeBoeuf. "The staff's process was result-oriented, facts be damned. The government's claims are false and they will be proven to be so."

An SEC official said Cuban was given the public offering information from Mamma.com in confidence, and Cuban made illegal use of that knowledge.

"As we allege in the complaint, Mamma.com entrusted Mr. Cuban with nonpublic information after he promised to keep the information confidential," Scott W. Friestad, Deputy Director of the SEC's Division of Enforcement, said in the report. "Less than four hours later, Mr. Cuban betrayed that trust by placing an order to sell all of his shares."

Mamma.com has since changed its name to Copernic Technologies (CNIC), and now produces Internet search-advertising services in addition to search software. Copernic's stock currently trades for less than $1 per share.

According to Phillip Stern, a former SEC attorney and current lawyer at Neal, Gerber & Eisenberg, Cuban will likely face a fine of twice the losses he would have incurred, or about $1.5 million. The SEC's lawsuit is a civil case, and Cuban does not face any criminal charges.

Stern does not believe Cuban will have to divest his ownership stake in his other companies, including cable network HDNet.

Cuban has been identified as one of the bidders for Major League Baseball's Chicago Cubs for about a year, after the team was put up for sale by owner Sam Zell, chief executive of the Tribune Co. But baseball sources told the Chicago-Sun Times last week that Cuban is unlikely to get the league's blessing despite his deep pockets.

"These allegations really say something about his integrity," said Stern. "Baseball was already concerned about him, and now it will be difficult to persuade them otherwise."



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Last Updated ( Monday, 17 November 2008 )
 
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