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Massive BP Risk lay in the $615T OTC Market that only the major
international banks have any visibility to.... and they are not talking!
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I could not have stated it any clearer than Jim Sinclair at jsmineset.com:
"People are seriously underestimating how much liquidity in the global financial
world is dependent on a solvent BP. BP extends credit - through trading and
finance. They extend the amounts, quality and duration of credit a bank could
only dream of. You should think about the financial muscle behind a company with
100+ years of proven oil and gas reserves. Think about that in comparison to a
bank with few tangible assets. Then think about what happens if BP goes under.
This is no bank. With proven reserves and wells in the ground, equity in fields
all over the planet, in terms of credit quality and credit provision - nothing
can match an oil major. God only knows how many assets around the planet are
dependent on credit and finance extended from BP. It is likely to dwarf any
banking entity in multiples.... The price tag and resultant knock-on effects of
a BP failure could easily be equal to that of a Lehman, if not more. It is
surely, at the very least, Enron x10.
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[Blockierte Grafik: http://static.safehaven.com/authors/long/17352_h.png]
Are the final gulf oil spill costs going to be $20B or $60B? Does anyone
know? I personally believe it is closer to the latter than the former. If we
just use the reported oil spillage numbers for comparison we might get a better
understanding of the complete failure to grasp the scope of the disaster.
According to the Financial Times, the oil spillage was reported as follows:
SPILLAGE(bls./day)/// COST TO DATE
April 20 1000
May 4 5000
May 7 5000 ///////// 350M
May 14 5000 ///////// 625M
May 28 15,500 //////// 950M
June 3 19,000 //////// 990M
June 8 15,500 //////// 1,250M
June 10 15,500 /////// 1,430M
June 17 15,500 ////// 1,600M
June 23 25,800 ///// 2,600M
Spillage increased by 25 X in 60 days
As time passes the numbers are rising exponentially. Engineers
are warning that the capture will be complicated and scientists monitoring
the situation are predicting the spill will prove larger than the current
estimates are reflecting. An expert in the field, Matt Simmons of Simmons
International has
stated that the flows are over 100,000 barrels per day. Most independent
experts agree.
Assuming $4,000/barrel damages costs, 100,000 barrels per day flow rates, a
90 day flow duration (minimal), we arrive at clean-up, litigation and damage
compensation of approximately $32B. This is nearly twice the US escrow account
agreement and within our expectations of between $20 and 60B. There are a range
of issues regarding further leaks, shifting seafloor, methane levels,
hurricanes, disbursement effects and many more that are surfacing daily that
will have significant negative impact on current analysis and assumptions.
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Quelle:
http://www.safehaven.com/artic…e-devastating-than-lehman
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