文章基本信息

标题：Oil is fungible
作者：Jeff Moore
期刊名称：World Oil Magazine
出版年度：2006
卷号：Jan 2006
出版社：Gulf Publishing Co.

Oil is fungible

Jeff Moore

Oil is fungible. The oil-is-fungible camp believes that the global market will exploit every liter of oil and every cubic meter of gas possible and sell it wherever there is demand, regardless of national interests. They think that if one country is relying heavily on one region for its hydrocarbons, other countries can rely on alternate regions for theirs, with no negative impact on the price or supply. Fungible believers assert that the marketplace sets global prices and that oil and gas are commodities that everyone uses and no one monopolizes.

Precedent exists in Asia for the fungible argument, and CNOOC Ltd. is an example. First, it does not hoard all the oil and gas it finds for Beijing. A sizable amount is sold on the open market. The company's most recent 20-F report says that it markets oil and gas to the US, Japan, South Korea and Australia. It also sells to spot market traders.

In 2002, the firm exported 14.9% of its crude. In 2003, this rose to 26.5%, and in 2004, it was 18.8%. CNOOC Ltd.'s international sales revenues generally follow suit. In 2002, they accounted for 13.6% of total revenues. In 2003, they were 37.9%, and in 2004, 44.9%. Thus, CNOOC Ltd. plays the international market like any other energy firm, demonstrating its fungible side.

Second, CNOOC Ltd.'s foreign partners have the right to sell their shares of oil on international markets, if they so desire. And they frequently have, but because of Chinas increased domestic demand and the shrinking costs of transporting hydrocarbons from PRC waters to the mainland, foreign partner domestic sales have increased. In 2002, CNOOC Ltd.'s foreign partners exported 50% of their oil to international markets. In 2003, this shrank to 31%, and in 2004, to 30%. Despite this market-driven decline, such sales still demonstrate CNOOC Ltd.'s policy of integration with free market traders.

Third, many of CNOOC Ltd.'s overseas contracts reflect the fungible argument. For instance, from its 16.96% share of Indonesia's Tangguh field, the company forged a 20-year contract to provide 1.35 million tons of LNG per year to two South Korean companies, SK Power Company Ltd. and POSCO. As of June 2005, CNOOC Ltd. was in talks to provide Indonesian LNG to North American concerns. The firm generates hefty revenues from these ventures and does not insist on taking all of its foreign-acquired oil and gas to China.