Well, I gotta say today was an interesting day. Even I was surprised by the extreme bullishness of this market. Crude opened down hard and was down over 70 cents at one point this morning and then as if by magic, the market whipsawed and ended up a bunch 40 some cents. That's a hell of a swing boys and girls. Much physical gathering taking place out there matched by long, long funds. Me thinks everyone has now figured out that there WILL be some tightness at year end. Also, the Vens helped out with a silly statement on Ven TV by Chavez saying that he wanted to keep crude in a range. Crude sold hard and then the market realized he was just trying to appease the crowds of disgruntled masses who want some relief from their dismal lives down in Venland. Anyway.....it got me to thinking that I'd like to see a better picture of the overall supply situation and ID some of the trouble spots. Here's a crack at it.

Yesterday the US State Department released updated Consular Information sheets along with the UK's foreign office. Although the US sheets are somewhat couched in "soft" language, it seems we will see at least some risk of oil flow disruption at the turn of the century. These countries have been listed in negative order.

My comments along with fairly recent EIA export data are in [brackets]I haven't had a chance to look at the UK's assessments, but I understand they are a little more frank than the US's.

Nigeria In Nigeria, there is a risk of potential disruption in the key sectors of transportation, telecommunications, and public utilities. Such disruptions may affect electric power and telephone service. U.S. citizens traveling to or residing in Nigeria in late 1999 or early 2000 should be aware of potential difficulties. [The majority of Nigeria's crude exports are destined for markets in the United States and Western Europe. Asia is increasingly becoming a destination for Nigerian crude, but economic difficulties in the region have hindered oil demand growth. Nigerian crude exports to the United States averaged 689,000 bbl/d in 1998 (7.9% of U.S. imported crude oil). Nigeria was the 5th largest crude exporter to the United States in 1998 behind Saudi Arabia, Venezuela, Mexico and Canada. For the first 5 months of 1999, Nigerian crude exports to the United States have averaged 682,000 bbl/d, making Nigeria the 6th largest source of crude supplied to the United States. Nigeria is normally beset by economic strife, Y2K will certainly exacerbate this providing some disruptions.] Angola Angola is not heavily reliant on computerized systems and appears to be somewhat prepared to deal with the Y2K problem. Angola's economy is heavily dependent on the oil sector. The efforts of both Western and local oil companies have helped to address the Y2K problem associated with the oil companies. However, few organizations outside of Angola's oil industry have allocated any resources to the Y2K problem. Although Angola continues remediation efforts and contingency planning, at the present time, it appears that there may be a risk of potential disruption in the key sectors of finance, transportation, and government services. Such disruptions may specifically affect the availability of medical care, electrical power, and accommodations. U.S. citizens traveling to or residing in Angola in late 1999 or early 2000 should be aware of potential difficulties. [Angola's crude oil exports to the United States were 445,000 bbl/d in 1998 (60.5% of Angola's production for the year). Angola was the sixth largest supplier (largest non-OPEC supplier outside the Western Hemisphere) of imported crude to the United States in 1998. Angolan crude is also exported to European and Asian markets. As part of a debt-servicing agreement, Angola exports nearly 20,000 bbl/d to Brazil. This analysis combined with increases in Asian demand indicate tight WAF situation as we roll into the year end.] Russia Russia is not heavily reliant on computerized systems. To the extent it is reliant on them, the country appears to be somewhat prepared to deal with the Y2k problem. Although Russia continues remediation efforts and contingency planning, at the present time, Y2K disruptions are likely to occur in the key sectors of electrical power, heat, telecommunications, transportation, and financial and emergency services. U.S. citizens residing in Russia in late 1999 or early 2000 should be aware of potential difficulties. Americans planning travel to Russia during this period should take fully into account the information in this document and plan their travel and its timing accordingly. [Russia is important to world energy markets because it contains the world's largest natural gas reserves, second largest coal reserves, and eighth largest oil reserves. Russia is also the world's second largest energy consumer, and is the world's largest exporter of natural gas and second largest exporter of energy and petroleum in the world. In1997, Russian oil exports (crude oil and products) outside the former Soviet Union averaged 3.2 million bbl/d, an increase of almost 7% from 1996 levels. The Ministry of Fuel and Energy has stated that they expect that crude oil exports in 1998 will reach 2.3 million barrels/day. Since 1991, Russian oil producers have shown a preference for increasing their hard-currency earnings by exporting outside of the former Soviet Union. The share of net exports to countries outside the former Soviet Union has risen from 53% in 1992 to 91% in 1997. Most of Russia's oil exports are destined for European customers, including the United Kingdom, France, Italy, Germany , and Spain. Petroleum exports (except those that pass by rail, truck, and barge) must use the 31,000-mile pipeline network operated by state-owned Transneft. [Russia is well and truly hosed on Y2K, they ignored it and didn't have any funds to fix it anyway. We'll be lucky if they don't have 2 or three nuke meltdowns. I think we'll see some serious interruptions to supply which will tighten the North Sea at precisely the time it will be in demand from the US due to reduced WAF supply. Yeehaa.] Algeria Algeria is not as heavily reliant on computerized systems as many developed countries. Algeria's hydrocarbon industries appear well prepared for Y2K contingencies. The Algerian Government established a national Y2K Commission in September 1998. Most of Algeria's efforts regarding Y2K are focused on three areas: financial, aviation, and energy. The government's Y2K approach has been uneven and there may be some disruptions in the banking, communications, public utility and transport sectors. U.S. citizens traveling to or residing in Algeria in late 1999 or early 2000 should be aware of potential difficulties. [Algeria is important to world energy markets because it is a significant oil and gas producer and exporter. Algeria also is a member of OPEC and an important energy source for Europe. Official estimates of Algeria's proven oil reserves remain at 9.2 billion barrels. However, with the recent oil discoveries, plans for more exploration drilling, improved data on existing fields, and use of enhanced oil recovery (EOR) systems, proven oil reserve estimates are expected to be revised upward in coming years. Algeria should also see a sharp increase in crude oil exports over the next few years due to a rapid shift towards domestic natural gas consumption and planned increases in oil production by Sonatrach and its foreign partners. Approximately 90% of Algeria's crude oil exports go to Western Europe, with Italy as the main market followed by Germany and France. The Netherlands, Spain and Britain are other important European markets. Algeria's Saharan Blend oil, 45o API with 0.05% sulfur and negligible metal content, is among the best in the world. Just a little more tightness for WAF and the North Sea] China Major coastal cities in the People's Republic of China are moderately reliant on computerized systems. Chinese Y2K remediation and contingency efforts have focused on critical infrastructure systems in these cities, which are generally well-prepared to deal with the Y2K problem. Reliance on computerized systems is much lower in the interior of China where Y2K will have a low impact. Although China continues remediation efforts and contingency planning, at the present time it appears there may be a risk of potential disruption in the key sectors of banking and finance, telecommunications, medical services, and in electrical power and infrastructure systems outside of the coastal cities. Chinese authorities expect that any potential disruptions will be concentrated in small- and medium-sized enterprises, and that there is a moderate risk of potential disruption in freight-forwarding and distribution networks. [As a net crude importer since 1996, China's petroleum industry is focused on meeting domestic demand, but it does export significant amounts of crude. The largest export consumer by far is Japan, which imports 120,000-160,000 barrels per day (bbl/d) for electricity generation. This supply came into question earlier in 1999, when CNPC informed the Japanese that it would no longer be available for export, due to CNPC's desire to refine it for sale on the domestic market rather than sell it at low world market prices. By all accounts the Chinese will have some serious problems. They haven't been exporting near as much as they used to anyway, and they may actually have some pretty bad refinery probs. (early article had their refineries launching cat crackers) which will cut down on a piece of Asian demand] Qatar Qatar is not heavily reliant on computerized systems and appears to be somewhat prepared to deal with the Y2K problem. Although Qatar continues some remediation efforts and contingency planning, at the present time it appears that there may be a risk of potential disruption in such key sectors as power generation and telecommunications. U.S. citizens traveling to or residing in Qatar in late 1999 or early 2000 should be aware of potential difficulties. [Qatar contains the third largest natural gas reserves and the largest non-associated gas field in the world. Qatar is also emerging as a major exporter of liquefied natural gas. An OPEC member, Qatar exports over 600,000 barrels of oil per day. Qatar exports almost all of its oil production to Asia. In 1998, net oil exports totaled 737,000 barrels per day (bbl/d), though production has fallen in 1999 as a result of Qatar's support for OPEC production cuts. More tightness for WAF if production is interrupted, which it prob. will be.] Saudi Arabia Saudi Arabia is reliant on computerized systems and is working with the international community to minimize any impact as a result of Y2K. While Saudi Arabia appears to be generally prepared to deal with the Y2K problem, remediation efforts and contingency planning continue. At the present time it appears that there is a moderate risk of potential disruption in the telecommunications, banking and finance and electric power sectors. U.S. citizens traveling to or residing in Saudi Arabia in late 1999 or early 2000 should be aware of potential difficulties. [With one-quarter of the world's proven oil reserves, Saudi Arabia is expected to retain its rank as the world's largest oil producer for the foreseeable future. It is an important source of crude oil imports for the United States, supplying 1.4 million barrels per day, or nearly 16%, of U.S. crude oil imports in the first 10 months of 1998. Saudi Arabia is a key oil supplier for the United States, Europe, and Japan; however, in recent years, Western Hemisphere producers (Venezuela, Canada, and Mexico) have challenged Saudi Arabia's dominance in the U.S. market. Asia now takes about 60% of Saudi Arabia's crude oil exports, as well as the majority of its refined petroleum product exports. Europe is Saudi Arabia's second largest oil export market, followed by the United States. Through the first 10 months of 1998, Saudi Arabia exported 1.487 MMBD of oil (1.399 MMBD of crude) to the United States. For this time period, Saudi Arabia ranked third (after Venezuela and Canada) as a source of total (crude plus refined products) U.S. oil imports, and first for crude only. Saudi Arabia is eager to maintain and even expand its market share in the United States for a variety of economic and strategic reasons. For the first 10 months of 1998, Saudi Arabia's share of U.S. crude oil imports was 16.3%, up from 15.8% for the same period in 1997. The internet has been buzzing with the Saudi's status as of late. A poster who identified himself as an upstream VP at a multinational hears that they have load port problems with Y2K, but that their de-sal plants are going to be OK. ] Norway Norway is a modern industrial state dependent on computer systems for a large part of its production of goods and services. It has made progress on remediation efforts and developing contingency plans, and is otherwise prepared to deal with Y2K problems. It appears that there is a low risk of potential Y2K disruptions in key sectors. Norway is also working with the international community to minimize the economic impact of Y2K problems. [Good news here] Mexico Mexico, increasingly reliant on computerized systems, is working with the international community to minimize any impact as a result of Y2K. Mexico appears to be prepared to deal with the Y2K problem. Mexico's general Y2K awareness is high. The Mexican Government formed a Year 2000 National Conversion Commission in June 1998 to oversee Y2K problem remediation and contingency planning. The Commission has made extensive efforts to build awareness and expedite and supervise remediation in both private and public sectors. The Y2K National Conversion Commission has effectively engaged national Y2K coordinators from the U.S., Canada and other countries. [I don't buy the Mexican claims for a second. They are most likely hosed and not admitting it. Why we are giving them a green light is a mystery to me.] Iraq, Iran, Congo, Libya Currently, we do not have a diplomatic presence and therefore are unable to assess its Y2K readiness. Little information is available on the Y2K remediation and contingency planning efforts, though Iraq does not rely heavily on information technology. [Iraq is important to world energy markets because it holds more than 112 billion barrels of oil - the world's second largest reserves. Iraq also contains 110 trillion cubic feet of gas. Prior to its invasion of Kuwait in August 1990, Iraqi oil production had just recovered from the costly Iran-Iraq War. By July 1990, Iraqi crude oil output had reached 3.5 MMBD, with production capacity at 4.5 MMBD -- the highest levels since 1979. Following Iraq's invasion of Kuwait and the embargo on Iraqi oil exports, though, oil production fell to around 300,000 bbl/d. Through the first 8 months of 1998, Iraqi crude oil production was averaging 2 MMBD, up from 1.2 MMBD in 1997 (in October 1998, production reached approximately 2.4 MMBD). About 550,000-600,000 bbl/d of Iraq's oil output is consumed domestically, either for refining or for direct burning by industrial customers or utilities. Another 90,000-100,000 bbl/d is delivered to Jordan via truck under a special U.N. exemption to sanctions. Iran is OPEC's second largest oil producer and accounts for roughly 5% of global oil output. The country holds 9% of the world's oil reserves and 15% of its gas reserves. Additionally, Iran is a focal point for regional security issues. Production Iran is OPEC's second-largest oil producer, with average 1998 crude oil production of 3.6 million bbl/d. Iran's current sustainable production capacity is estimated as high as 4 million bbl/d, but this figure is controversial since Iran may have maintained production levels at some older fields only by using methods which have permanently damaged the fields. In December 1997, Oil Minister Zanganeh stated that the country aimed to boost oil production capacity 200,000-250,000 bbl/d each year, possibly surpassing 6 million bbl/d by 2010. Some observers are skeptical about whether this goal, which would nearly restore the country's production capacity of the mid-1970s, is possible. Lotsa crude at risk here boys and girls. Let's hope they're working on it.] Columbia Colombia is reliant on computerized systems and appears to be generally prepared to deal with the Y2K problem. There will likely be delays in billing for many basic services in the early months of Y2K. Problems with machines relying upon time-sensitive chips in the health care sector (such as dialysis machines) are likely, and major cities could experience problems with traffic control systems. The Colombian Government established a Year 2000 Council in September 1997. The Year 2000 Council is coordinating national efforts, and a national plan has been developed. Serious interruptions of basic services such as power and water are unlikely. Most private banks in Colombia are prepared for Y2K, as are the major telecommunications companies. In Colombia, it appears that there is a low risk of potential Y2K disruptions in the key sectors of banking, finance and electric power. U.S. citizens traveling to or residing in Colombia in late 1999 or early 2000 should be aware of potential difficulties. [Colombia is a major exporter of petroleum and coal. The United States, its largest trading partner and leading foreign investor, was the destination for about 10% of its coal exports and about 70% of its oil exports in 1997. Colombia aims to boost exploration to preserve its status as a net oil exporter in the future. Hydropower currently provides most of the country's electricity. Colombia's oil production is at an all-time high, up from just over 100,000 barrels per day (bbl/d) in the early 1980s, to an estimated 844,000 bbl/d in the first quarter of 1999. In 1998, Colombia earned about $3.1 billion from oil exports, providing the largest share of the country's export revenue (followed by coffee and coal). Colombia has about 2.6 billion barrels of proven reserves of oil, and possibly 10 times this amount in potential reserves. Oil production is located mainly in the Cusiana and Cupiagua fields in the eastern Andes foothills, and in the Cano Limsn field in Arauca province near the Venezuelan border. Cusiana/Cupiagua contains an estimated 1.2 billion barrels of proven reserves and 3.0 billion cubic feet (bcf) of natural gas, and is currently producing about 500,000 bbl/d of oil, up from about 380,000 bbl/d one year ago, while the Cano Limsn field is currently producing about 140,000 bbl/d. Most of the oil from the Cusiana/Cupiagua fields is exported, primarily to the United States. The oil is shipped through the 470-mile Oleoducto Central (Ocensa) pipeline, opened in 1997, to an export terminal at Covenas, on the Caribbean coast. Again a big old "they're greaaat!" for Columbia doesn't fly well in my book, but take it for what it's worth.] Canada Canada's reliance on computerized systems is high. Its advanced Y2K awareness is evident throughout all public and private sectors. Its efforts to address the Y2K problem are also highly advanced. The Canadian Government has instituted sophisticated coordinating mechanisms for addressing Y2K, readily shares information on its Y2K status, and has established a national Y2K website. The government has been very proactive, sending Y2K information packets to all households and major businesses. Canada is well prepared to deal with the Y2K problem. In Canada, it appears there is a low risk of potential Y2K disruptions in key sectors. Canada has worked closely with the international community to minimize any potential economic impact of possible Y2K disruptions. U.S. citizens traveling to or residing in Canada in late 1999 or early 2000 should, nevertheless, be aware of any potential difficulties. [The United States is Canada's major trade market for energy products, accounting for 91% of all Canadian energy exports (including nearly all of Canada's oil, natural gas, and electricity exports). Coal is exported mainly to the Far East. Good news here except for the bearishness of the Canadian government. If you read their public press, they're anticipating Defcon 6 level impact. They have activated their entire military and have stated publicly that the armed forces will be allocated only to Canada during the rollover.] Australia Australia is heavily reliant on computerized systems and appears to be well prepared to deal with the Y2K problem. Australia has undertaken extensive Y2K preparations and has coordinated efforts to help government agencies, service providers, and private industry with Y2K remediation and contingency planning. All key industries (banking and finance, electricity, health and telecommunications) have achieved or are aggressively working toward Y2K compliance. UAE The United Arab Emirates (UAE) is reliant on computerized systems and is working with the international community to minimize any impact as a result of Y2K. The UAE appears to be well prepared to deal with the Y2K problem. While there are never any guarantees, inquiries and research have so far suggested that the UAE is remarkably well prepared for Y2K, and that there is so far no evidence indicating the possibility of potential disruptions in any key sectors. However, U.S. citizens traveling to or residing in the UAE in late 1999 or early 2000 should be aware of potential difficulties.

-- Gordon (g_gecko_69@hotmail.com), September 15, 1999

Answers

Please excuse the formatting. Had it separated into paragraph's but they got hosed. HTML idiot here.

-- Gordon (g_gecko_69@hotmail.com), September 15, 1999.

Gordon

In regards to Canada alerting our military, this is primaraly a precaution because of the effect of the recent Quebec Ice Storm in which it was mobilized. I doubt if there are any Canadians that worry about the Army involvement and it is mainly a contingency plan although they will be providing limited security if the situation demands it.

The armed forces gained lots of respect for their involvement in Quebec and Ontario therefore they are trusted. Another issue is the fact that us Canadians have such bloody cold winters that if something does get affected the situation has to be delt with and the army would be assisting in anyway they can engineering wise.

To bad that your post didn't turn out, looks really interesting. Should try it again but use the return key twice when spacing paragraphs.

-- Brian (imager@home.com), September 15, 1999.

Thanks Gordon. Good stuff and very informative.

-- Mike Lang (webflier@erols.com), September 15, 1999.

Gordon,

Thanks for all that! Here's a stab at reformating that BIG paragraph. :-)

Jerry

Nigeria

In Nigeria, there is a risk of potential disruption in the key sectors of transportation, telecommunications, and public utilities. Such disruptions may affect electric power and telephone service. U.S. citizens traveling to or residing in Nigeria in late 1999 or early 2000 should be aware of potential difficulties.

[The majority of Nigeria's crude exports are destined for markets in the United States and Western Europe. Asia is increasingly becoming a destination for Nigerian crude, but economic difficulties in the region have hindered oil demand growth. Nigerian crude exports to the United States averaged 689,000 bbl/d in 1998 (7.9% of U.S. imported crude oil). Nigeria was the 5th largest crude exporter to the United States in 1998 behind Saudi Arabia, Venezuela, Mexico and Canada. For the first 5 months of 1999, Nigerian crude exports to the United States have averaged 682,000 bbl/d, making Nigeria the 6th largest source of crude supplied to the United States. Nigeria is normally beset by economic strife, Y2K will certainly exacerbate this providing some disruptions.]

Angola

Angola is not heavily reliant on computerized systems and appears to be somewhat prepared to deal with the Y2K problem. Angola's economy is heavily dependent on the oil sector. The efforts of both Western and local oil companies have helped to address the Y2K problem associated with the oil companies. However, few organizations outside of Angola's oil industry have allocated any resources to the Y2K problem. Although Angola continues remediation efforts and contingency planning, at the present time, it appears that there may be a risk of potential disruption in the key sectors of finance, transportation, and government services. Such disruptions may specifically affect the availability of medical care, electrical power, and accommodations. U.S. citizens traveling to or residing in Angola in late 1999 or early 2000 should be aware of potential difficulties.

[Angola's crude oil exports to the United States were 445,000 bbl/d in 1998 (60.5% of Angola's production for the year). Angola was the sixth largest supplier (largest non-OPEC supplier outside the Western Hemisphere) of imported crude to the United States in 1998. Angolan crude is also exported to European and Asian markets. As part of a debt-servicing agreement, Angola exports nearly 20,000 bbl/d to

Brazil.

This analysis combined with increases in Asian demand indicate tight WAF situation as we roll into the year end.]

Russia

Russia is not heavily reliant on computerized systems. To the extent it is reliant on them, the country appears to be somewhat prepared to deal with the Y2k problem. Although Russia continues remediation efforts and contingency planning, at the present time, Y2K disruptions are likely to occur in the key sectors of electrical power, heat, telecommunications, transportation, and financial and emergency services. U.S. citizens residing in Russia in late 1999 or early 2000 should be aware of potential difficulties. Americans planning travel to Russia during this period should take fully into account the information in this document and plan their travel and its timing accordingly.

[Russia is important to world energy markets because it contains the world's largest natural gas reserves, second largest coal reserves, and eighth largest oil reserves. Russia is also the world's second largest energy consumer, and is the world's largest exporter of natural gas and second largest exporter of energy and petroleum in the world.

In1997, Russian oil exports (crude oil and products) outside the former Soviet Union averaged 3.2 million bbl/d, an increase of almost 7% from 1996 levels. The Ministry of Fuel and Energy has stated that they expect that crude oil exports in 1998 will reach 2.3 million barrels/day. Since 1991, Russian oil producers have shown a preference for increasing their hard-currency earnings by exporting outside of the former Soviet Union. The share of net exports to countries outside the former Soviet Union has risen from 53% in 1992 to 91% in 1997. Most of Russia's oil exports are destined for European customers, including the United Kingdom, France, Italy, Germany , and Spain. Petroleum exports (except those that pass by rail, truck, and barge) must use the 31,000-mile pipeline network operated by state-owned Transneft.

[Russia is well and truly hosed on Y2K, they ignored it and didn't have any funds to fix it anyway. We'll be lucky if they don't have 2 or three nuke meltdowns. I think we'll see some serious interruptions to supply which will tighten the North Sea at precisely the time it will be in demand from the US due to reduced WAF supply. Yeehaa.]

Algeria

Algeria is not as heavily reliant on computerized systems as many developed countries. Algeria's hydrocarbon industries appear well prepared for Y2K contingencies. The Algerian Government established a national Y2K Commission in September 1998. Most of Algeria's efforts regarding Y2K are focused on three areas: financial, aviation, and energy. The government's Y2K approach has been uneven and there may be some disruptions in the banking, communications, public utility and transport sectors. U.S. citizens traveling to or residing in Algeria in late 1999 or early 2000 should be aware of potential difficulties.

[Algeria is important to world energy markets because it is a significant oil and gas producer and exporter. Algeria also is a member of OPEC and an important energy source for Europe. Official estimates of Algeria's proven oil reserves remain at 9.2 billion barrels. However, with the recent oil discoveries, plans for more exploration drilling, improved data on existing fields, and use of enhanced oil recovery (EOR) systems, proven oil reserve estimates are expected to be revised upward in coming years. Algeria should also see a sharp increase in crude oil exports over the next few years due to a rapid shift towards domestic natural gas consumption and planned increases in oil production by Sonatrach and its foreign partners. Approximately 90% of Algeria's crude oil exports go to Western Europe, with Italy as the main market followed by Germany and France. The Netherlands, Spain and Britain are other important European markets. Algeria's Saharan Blend oil, 45o API with 0.05% sulfur and negligible metal content, is among the best in the world. Just a little more tightness for WAF and the North Sea]

China

Major coastal cities in the People's Republic of China are moderately reliant on computerized systems. Chinese Y2K remediation and contingency efforts have focused on critical infrastructure systems in these cities, which are generally well-prepared to deal with the Y2K problem. Reliance on computerized systems is much lower in the interior of China where Y2K will have a low impact. Although China continues remediation efforts and contingency planning, at the present time it appears there may be a risk of potential disruption in the key sectors of banking and finance, telecommunications, medical services, and in electrical power and infrastructure systems outside of the coastal cities. Chinese authorities expect that any potential disruptions will be concentrated in small- and medium-sized enterprises, and that there is a moderate risk of potential disruption in freight-forwarding and distribution networks.

[As a net crude importer since 1996, China's petroleum industry is focused on meeting domestic demand, but it does export significant amounts of crude. The largest export consumer by far is Japan, which imports 120,000-160,000 barrels per day (bbl/d) for electricity generation. This supply came into question earlier in 1999, when CNPC informed the Japanese that it would no longer be available for export, due to CNPC's desire to refine it for sale on the domestic market rather than sell it at low world market prices.

By all accounts the Chinese will have some serious problems. They haven't been exporting near as much as they used to anyway, and they may actually have some pretty bad refinery probs. (early article had their refineries launching cat crackers) which will cut down on a piece of Asian demand]

Qatar

Qatar is not heavily reliant on computerized systems and appears to be somewhat prepared to deal with the Y2K problem. Although Qatar continues some remediation efforts and contingency planning, at the present time it appears that there may be a risk of potential disruption in such key sectors as power generation and telecommunications. U.S. citizens traveling to or residing in Qatar in late 1999 or early 2000 should be aware of potential difficulties.

[Qatar contains the third largest natural gas reserves and the largest non-associated gas field in the world. Qatar is also emerging as a major exporter of liquefied natural gas. An OPEC member, Qatar exports over 600,000 barrels of oil per day. Qatar exports almost all of its oil production to Asia. In 1998, net oil exports totaled 737,000 barrels per day (bbl/d), though production has fallen in 1999 as a result of Qatar's support for OPEC production cuts. More tightness for WAF if production is interrupted, which it prob. will be.]

Saudi Arabia

Saudi Arabia is reliant on computerized systems and is working with the international community to minimize any impact as a result of Y2K. While Saudi Arabia appears to be generally prepared to deal with the Y2K problem, remediation efforts and contingency planning continue. At the present time it appears that there is a moderate risk of potential disruption in the telecommunications, banking and finance and electric power sectors. U.S. citizens traveling to or residing in Saudi Arabia in late 1999 or early 2000 should be aware of potential difficulties.

[With one-quarter of the world's proven oil reserves, Saudi Arabia is expected to retain its rank as the world's largest oil producer for the foreseeable future. It is an important source of crude oil imports for the United States, supplying 1.4 million barrels per day, or nearly 16%, of U.S. crude oil imports in the first 10 months of 1998. Saudi Arabia is a key oil supplier for the United States, Europe, and Japan; however, in recent years, Western Hemisphere producers (Venezuela, Canada, and Mexico) have challenged Saudi Arabia's dominance in the U.S. market. Asia now takes about 60% of Saudi Arabia's crude oil exports, as well as the majority of its refined petroleum product exports. Europe is Saudi Arabia's second largest oil export market, followed by the United States. Through the first 10 months of 1998, Saudi Arabia exported 1.487 MMBD of oil (1.399 MMBD of crude) to the United States. For this time period, Saudi Arabia ranked third (after Venezuela and Canada) as a source of total (crude plus refined products) U.S. oil imports, and first for crude only. Saudi Arabia is eager to maintain and even expand its market share in the United States for a variety of economic and strategic reasons. For the first 10 months of 1998, Saudi Arabia's share of U.S. crude oil imports was 16.3%, up from 15.8% for the same period in 1997.

The internet has been buzzing with the Saudi's status as of late. A poster who identified himself as an upstream VP at a multinational hears that they have load port problems with Y2K, but that their de-sal plants are going to be OK. ]

Norway

Norway is a modern industrial state dependent on computer systems for a large part of its production of goods and services. It has made progress on remediation efforts and developing contingency plans, and is otherwise prepared to deal with Y2K problems. It appears that there is a low risk of potential Y2K disruptions in key sectors. Norway is also working with the international community to minimize the economic impact of Y2K problems. [Good news here]

Mexico

Mexico, increasingly reliant on computerized systems, is working with the international community to minimize any impact as a result of Y2K. Mexico appears to be prepared to deal with the Y2K problem. Mexico's general Y2K awareness is high. The Mexican Government formed a Year 2000 National Conversion Commission in June 1998 to oversee Y2K problem remediation and contingency planning. The Commission has made extensive efforts to build awareness and expedite and supervise remediation in both private and public sectors. The Y2K National Conversion Commission has effectively engaged national Y2K coordinators from the U.S., Canada and other countries.

[I don't buy the Mexican claims for a second. They are most likely hosed and not admitting it. Why we are giving them a green light is a mystery to me.]

Iraq, Iran, Congo, Libya

Currently, we do not have a diplomatic presence and therefore are unable to assess its Y2K readiness. Little information is available on the Y2K remediation and contingency planning efforts, though Iraq does not rely heavily on information technology.

[Iraq is important to world energy markets because it holds more than 112 billion barrels of oil - the world's second largest reserves. Iraq also contains 110 trillion cubic feet of gas. Prior to its invasion of Kuwait in August 1990, Iraqi oil production had just recovered from the costly Iran-Iraq War. By July 1990, Iraqi crude oil output had reached 3.5 MMBD, with production capacity at 4.5 MMBD -- the highest levels since 1979. Following Iraq's invasion of Kuwait and the embargo on Iraqi oil exports, though, oil production fell to around 300,000 bbl/d. Through the first 8 months of 1998, Iraqi crude oil production was averaging 2 MMBD, up from 1.2 MMBD in 1997 (in October 1998, production reached approximately 2.4 MMBD). About 550,000-600,000 bbl/d of Iraq's oil output is consumed domestically, either for refining or for direct burning by industrial customers or utilities. Another 90,000-100,000 bbl/d is delivered to Jordan via truck under a special U.N. exemption to sanctions.

Iran is OPEC's second largest oil producer and accounts for roughly 5% of global oil output. The country holds 9% of the world's oil reserves and 15% of its gas reserves. Additionally, Iran is a focal point for regional security issues. Production Iran is OPEC's second-largest oil producer, with average 1998 crude oil production of 3.6 million bbl/d. Iran's current sustainable production capacity is estimated as high as 4 million bbl/d, but this figure is controversial since Iran may have maintained production levels at some older fields only by using methods which have permanently damaged the fields. In December 1997, Oil Minister Zanganeh stated that the country aimed to boost oil production capacity 200,000-250,000 bbl/d each year, possibly surpassing 6 million bbl/d by 2010. Some observers are skeptical about whether this goal, which would nearly restore the country's production capacity of the mid-1970s, is possible. Lotsa crude at risk here boys and girls. Let's hope they're working on it.]

Columbia

Colombia is reliant on computerized systems and appears to be generally prepared to deal with the Y2K problem. There will likely be delays in billing for many basic services in the early months of Y2K. Problems with machines relying upon time-sensitive chips in the health care sector (such as dialysis machines) are likely, and major cities could experience problems with traffic control systems. The Colombian Government established a Year 2000 Council in September 1997. The Year 2000 Council is coordinating national efforts, and a national plan has been developed. Serious interruptions of basic services such as power and water are unlikely. Most private banks in Colombia are prepared for Y2K, as are the major telecommunications companies. In Colombia, it appears that there is a low risk of potential Y2K disruptions in the key sectors of banking, finance and electric power. U.S. citizens traveling to or residing in Colombia in late 1999 or early 2000 should be aware of potential difficulties.

[Colombia is a major exporter of petroleum and coal. The United States, its largest trading partner and leading foreign investor, was the destination for about 10% of its coal exports and about 70% of its oil exports in 1997. Colombia aims to boost exploration to preserve its status as a net oil exporter in the future. Hydropower currently provides most of the country's electricity. Colombia's oil production is at an all-time high, up from just over 100,000 barrels per day (bbl/d) in the early 1980s, to an estimated 844,000 bbl/d in the first quarter of 1999. In 1998, Colombia earned about $3.1 billion from oil exports, providing the largest share of the country's export revenue (followed by coffee and coal). Colombia has about 2.6 billion barrels of proven reserves of oil, and possibly 10 times this amount in potential reserves. Oil production is located mainly in the Cusiana and Cupiagua fields in the eastern Andes foothills, and in the Cano Limn field in Arauca province near the Venezuelan border. Cusiana/Cupiagua contains an estimated 1.2 billion barrels of proven reserves and 3.0 billion cubic feet (bcf) of natural gas, and is currently producing about 500,000 bbl/d of oil, up from about 380,000 bbl/d one year ago, while the Cano Limn field is currently producing about 140,000 bbl/d. Most of the oil from the Cusiana/Cupiagua fields is exported, primarily to the United States. The oil is shipped through the 470-mile Oleoducto Central (Ocensa) pipeline, opened in 1997, to an export terminal at Covenas, on the Caribbean coast. Again a big old "they're greaaat!" for Columbia doesn't fly well in my book, but take it for what it's worth.]

Canada

Canada's reliance on computerized systems is high. Its advanced Y2K awareness is evident throughout all public and private sectors. Its efforts to address the Y2K problem are also highly advanced. The Canadian Government has instituted sophisticated coordinating mechanisms for addressing Y2K, readily shares information on its Y2K status, and has established a national Y2K website. The government has been very proactive, sending Y2K information packets to all households and major businesses. Canada is well prepared to deal with the Y2K problem. In Canada, it appears there is a low risk of potential Y2K disruptions in key sectors. Canada has worked closely with the international community to minimize any potential economic impact of possible Y2K disruptions. U.S. citizens traveling to or residing in Canada in late 1999 or early 2000 should, nevertheless, be aware of any potential difficulties.

[The United States is Canada's major trade market for energy products, accounting for 91% of all Canadian energy exports (including nearly all of Canada's oil, natural gas, and electricity exports). Coal is exported mainly to the Far East.

Good news here except for the bearishness of the Canadian government. If you read their public press, they're anticipating Defcon 6 level impact. They have activated their entire military and have stated publicly that the armed forces will be allocated only to Canada during the rollover.]

Australia

Australia is heavily reliant on computerized systems and appears to be well prepared to deal with the Y2K problem. Australia has undertaken extensive Y2K preparations and has coordinated efforts to help government agencies, service providers, and private industry with Y2K remediation and contingency planning. All key industries (banking and finance, electricity, health and telecommunications) have achieved or are aggressively working toward Y2K compliance.

UAE

The United Arab Emirates (UAE) is reliant on computerized systems and is working with the international community to minimize any impact as a result of Y2K. The UAE appears to be well prepared to deal with the Y2K problem. While there are never any guarantees, inquiries and research have so far suggested that the UAE is remarkably well prepared for Y2K, and that there is so far no evidence indicating the possibility of potential disruptions in any key sectors. However, U.S. citizens traveling to or residing in the UAE in late 1999 or early 2000 should be aware of potential difficulties.

-- Jerry B (skeptic76@erols.com), September 15, 1999.

It looks like I goofed when I split Brazil into a new paragraph. Sorry about that. :-(

Jerry

-- Jerry B (skeptic76@erols.com), September 15, 1999.

Also, it looks like Congo and Lybia got orphaned in some way.

Jerry

-- Jerry B (skeptic76@erols.com), September 15, 1999.

To view all the Y2K info for the Consular Briefs on one page, go here:

http:// www.sangersreview.com/countries.htm

-- pshannon (pshannon@inch.com), September 15, 1999.