CRUDE Development - Saudi BRAZILia ?

An interesting CRUDE OIL development I'll continue to keep tabs on as FATHER TIME unwinds but I must admit that I'm a little bit skeptical about HOW large the current Brazil government estimated numbers are (seems too good to be true) -

According to research from consulting firm Strategic Forecasting Inc., Brazil's recent discoveries of what MAY be two of the world's three BIGGEST oil finds in the past 30 years COULD help end the U.S.'s reliance on Middle East crude oil.

http://www.bloomberg.com/apps/news?pid=20601109&sid=aBUoYKhu7PWk&refer=home

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Some Takeaways (lots of good info from the article):

*Strategic Forecasting Inc. is a consulting firm based out of Austin, Texas...their customers include companies and governments around the world...A Barron's 2001 article described the firm as "the shadow CIA.''

*According to the International Energy Agency (IEA), Persian Gulf nations currently account for 23 % of U.S. imports...compared with Brazil's 1.7 % share. Brazilian crude output rose 1.9 percent last year to 2.14 million barrels in 2007.

*Brazil's state-controlled Petroleo Brasileiro SA (PBR) in November said the offshore TUPI field may hold 8 billion barrels of recoverable crude. Among discoveries in the past 30 years, only the 15 Billion barrel Kashagan field in Kazakhstan is larger...Meanwhile, another recent Brazillian oil field discovery, subsea field, CARIOCA, may have 33 billion barrels of oil. That would be the third biggest field in history, behind only the Ghawar field in Saudi Arabia and Burgan in Kuwait.

*IF additional drilling by Petroleo Brasileiro confirms the Tupi and Carioca estimates, the fields together would contain enough oil to supply every oil refinery on the U.S. Gulf Coast for 15 years...Petrobas said it needs at least three months to determine how much crude Carioca may hold.

*Saudi Arabia's influence as the biggest oil exporter would wane IF the fields are as big as advertised...China and India would become dominant buyers of Persian Gulf oil

*As a result of the discoveries, Brazil could be pumping ``several million'' barrels of crude daily by 2020, vaulting the nation into the ranks of the world's seven biggest producers.

*The U.S. currently imports about 10 million barrels of oil a day, or 66 percent of its needs, according to the Energy Department in Washington. Saudi Arabia was the second largest supplier in January, behind Canada.

*According to Strategic Forecasting Inc., more discoveries will follow in Brazil's offshore basins, most of which have yet to be opened to exploration. Repsol YPF SA, Exxon Mobile Corp. (XOM) and Devon Energy Corp. (DVN) are among the producers scouring Brazil's waters for reserves.

FINALLY...something to think about..."If the United States isn't getting any crude from the Gulf, what benefit does it have in policing the Gulf anymore? All of the geopolitical flux that wracks that region regularly suddenly isn't our problem." - - Sorry Israel ?

Data Courtesy: Bloomberg.com, snagged on 4/24/08.