Story : James Goyder
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With the price of oil having passed the symbolic 100 USD dollar a barrel mark for the first time only earlier this year experts are now predicting that the day that oil costs 200 USD a barrel is inevitable.

Rising Costs

But what are the underlying causes of this seemingly exponential rise in the cost of oil and what, ultimately, will be the consequences? Factors at the start of 2008 which contributed towards the cost of a barrel of crude oil breaking the 100 USD barrier included aggressive buying by speculators, cold weather in the northern hemisphere and the falling US dollar.

However this has proved to be no flash in the proverbial pan as prices have risen consistently with each new day seeing new records set for the price of oil, 125 USD a barrel at the time of writing. An obvious consequence of this is a rise in the cost of petrol at the pumps but any increase in the cost of oil is likely to have inflationary consequences.

Geopolitical Factors

While many have been predicting that the worlds’ oil will ultimately run out there is little evidence that a depletion of the planets natural resources is behind the rise in cost. There are a number of geopolitical factors which have restricted production of oil. The war in Iraq, one of the planets major producers of oil is an obvious and well publicized one. Also Nigeria’s oil production is currently running at about 20% below full capacity due to security concerns.

Meanwhile Saudi Arabia’s royal family has announced that it will not expand capacity, a decision which has put it at odds with the world’s biggest developed countries. Political instability in Venezuala and Russia has deterred foreign investors while proposed legislation by the Mexican government to make their oil production more efficient has met with fierce opposition. Despite being extremely vocal in its desire for cheaper oil the US government will not allow drilling in areas which it considers to be environmentally sensitive, such as Alaska.

Historical Precedent

The Opec (the Organisation of Petroleum Exporting Countries) cartel supplies about 40% of the world’s daily oil demand. The president of Opec, Chakib Khelil, recently voiced his prediction that the cost of oil would reach the 200 USD a barrel mark. So is the cost of oil set to rise and rise? Or is what we are currently experiencing merely a ‘spike’? There is precedent for fluctuations of the cost of oil. During the 1973 Arab-Israel war Opec orchestrated the Arab oil embargo, sending prices soaring by 400% in six months. Then the combination of the Iranian revolution and the Iran-Iraq war caused crude oil prices to more than double from 14 USD in 1978 to 35 USD in 1981.

More recently in 1990 the Iraqi invasion of Kuwait and subsequent Gulf war, partly prompted by the low price of oil, led to uncertainty about production and prices spiked. However even taking inflation into consideration the recent rise in the price of oil has been exceptional.

Environmentally Friendly

While motorists might not agree many environmentalists argue that an increase in the cost of petrol is not necessarily a bad thing as it discourages people from driving and consequentially polluting the environment. Also with 60% of the world’s poorest people living in resource rich countries another interesting consequence of increasing oil prices could be a gradual transfer of the world’s wealth from oil consuming countries to oil producing counties.

As the cost of oil becomes more prohibitive Thailand is now looking increasingly closely at alternative energy supplies and Piyasvasti Amranand, the Thai energy minister, recently reflected that, “Actually, I think that if oil prices continue to rise, it might be beneficial for the entire world, as it would force us to become serious about developing alternative energy.”
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The Emporium Host Successful Lifestyle And Property Event

The Emporium Shopping Complex have collaborated with 15 leading property project owners to launch ‘Emporium Lifestyle Home and Residences’, a new lifestyle and property event to serve  high end customers’ desires.

Ms. Inthira Janthong, Assistant to General Manager of the Emporium Shopping Complex organised the recent ‘Emporium Lifestyle Home and Residences’ event which attracted hundreds of quality Thai and foreign visitors. The 15 property project owners collectively secured sales worth THB 350 million during the 12-day event. Gifts and special promotional offers were also presented to the buyers who secured a unit at the Emporium Shopping Complex.

The next event will carry the same name as ‘Emporium Lifestyle Home and Residences’ and will be held from 22nd August to 1st September, 2008 at Emporium Shopping Complex.
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Evolution Land Co., Ltd.
Acquires The Lakes At Phoenix

Evolution Land Co., Ltd., approved the acquisition of 99.99% shareholding in Addax Development Co., Ltd. This move allows The Lakes to have a much higher profile, as it now becomes an integral part of Evolution Capital’s new property advisory business platform.

Evolution Capital also recently announced that MGP Hazel No. 1 Limited, an entity managed by Macquarie Global Property Advisors (MGPA) had become a 24.9% shareholder in Evolution Capital. MGPA are focused on global real estate investments and currently have over US$10 billion in assets under management. MGPA has also made a commitment of up to US$300mn to a real estate fund advised by Evolution Capital, which will be making branded hospitality investments in Thailand’s major tourist destinations including Bangkok, Phuket, Samui and Pattaya.
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Star Property Shine In Hua Hin

Established in 2007 by co-founders Ms. Sumalee Wilaiprasert and Mr. Lars Castenlund, this small, but experienced real estate agent is establishing their presence as a leading realtor in Hua Hin with a solid knowledge of the area and their competitive prices. The company offer a wide selection of services to the local and foreign investor, from sales and lettings via their 3D interactive website, to visa and work permit services. Star Property has particular focus on the Scandinavian market through international advertising and marketing activities.

For more information visit www.star-property-huahin.com
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New Resort Style Condominium In Hua Hin

Hua Hin Tropical Ocean View is a brand new project situated just 10 minutes drive north of Hua Hin centre and only 300 meters from the beach. The beach resort style condominium provides an excellent investment opportunity due to its location to Bangkok, the seaside ambiance of Hua Hin and the history as a royal retreat.

Tropical Ocean View has 12 floors, 183 units with 5 types of individual floor plans to choose from. Ranging from 46 to 198 square meters, all standard units have a minimum of 2 bedrooms and 2 bathrooms. The studio units have a combined bedroom/living room and come complete with a galley kitchen and fitted bathroom. All types have generous balconies that can easily accommodate deck chairs. All residents can enjoy the facilities including swimming pool, jacuzzi, fitness centre, tropical garden and restaurant.

Owners will enjoy sea and mountain views from the 4th floor and up while lower floors will have beautiful garden and pool views. Units start from less than 40,000 baht per square meter with studios from 1.98 million baht.

For more information please go to www.tropicaloceanview.com
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Royal Ambassador Residence Luxury in Oriental Living

A new up market residential estate has just been launched on the market in Pattaya. The new development of luxury villas is rising nicely amongst unspoilt natural terrain. The Royal Ambassador Residence is well situated in complete privacy and at the same time minutes away from Jomthien Beach, Ocean Marina, Phoenix Golf Course and the exuberant sights and sounds of Pattaya City as well as all the commodities and facilities.

Thai-Bali architectural harmonies blend in luxury and style to create this elite residential estate. The project consists of 27 pool-villas and a clubhouse, with a choice of 2, 3 and 4 bedrooms, 2 storey villas. Every villa comes with a private pool & Jacuzzi, ample tropical gardens, maids’ quarters and garage with automated door.

Prices start from THB 12.5 million and clients have the option of standard or deluxe interiors. Owners acquire membership in Royal Ambassador Residents Club (27 privileged members only) and participate in a 1-time club-raffle holding the winning prize of a brand new Toyota Camry.

For more information please see www.royalambassadorresidence.com
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Seastone Pool Villas Phase III Now Available

The final phase of the seastone project in the Laguna area of Phuket is now released for sale. The remaining 4 pool villas are located just 5 minutes from Bang Tao beach and Laguna golf course. The 1 bedroom (149 sqm) and 2 bedroom (199 sqm) villas come fully furnished with swimming pool and garage. Prices start from THB 7.49 million.

For more information please contact Adam on +66 (0) 83 908 0333.
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Banyan Tree Residences Success In Hong Kong

Banyan Tree Residences and Savills recently held a sales exhibition at the Landmark Mandarin Oriental Hotel in Hong Kong. In excess of 400 visitors attended over the 2-day event. A total of 18 reservations were secured with over half of the reservations received for properties in Thailand located in Phuket and Bangkok.

Richard Skene, of Banyan Tree commented: “I am very pleased with the results from our exhibition in Hong Kong, which exceeded our expectations and was even more successful than the launch event in May 2007.

“Given the current economic climate, the flexible financing options proved popular with investors. At Banyan Tree Residences Phuket, investors may defer 50% of the price over 5 years, with no interest due, and, at Banyan Tree Bangkok, loan finance is available for up to 70% of the value of the property.”
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The Place To Be In Koh Samui

The Place at Lipa Noi is situated on the west coast of the Island of Koh Samui. Being on the beachfront, The Place enjoys magnificent views and sunsets over the famous 5 Islands. The Place development incorporates both the services and attention of a resort with all the creature comforts of being at your own home.

The Place development consists of a mix of beachfront villas and a variety of 1, 2 and 3 bedroom villas and town houses all with private pools and full furniture packages included in the purchase price. Each villa/town house has been designed to maximize space and privacy while focusing on luxury and the lifestyle that go hand in hand. The Place Management team will handle all aspects of villa rental, maintenance and alike.

Beachfront villas are available from THB 8.9 million.

For more information visit: website www.theplacethailand.com
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Cityscape China Showcases Mega Developments      

Aside from featuring world-wide real estate developers from more than 15 countries, Cityscape China 2008 - the renowned international real estate investment and development event - will showcase numerous high profile projects including those of US-based MGM Mirage, UAE’s ETA Star Property, Meydan LLC, and Dubai’s Fortune Group. Organised by the Institute for International Research (IIR), Cityscape China 2008 will be held at the Shanghai New International Expo Centre in Pudong, China from 25th to 27th June 2008.
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SIAM Legal
Open New Branch

Thailand’s largest legal network service recently opened the doors to their new branch located close to Laguna in Bang Tao Place, Phuket. Offering an extensive range of professional legal services including real estate, construction and corporate work. SIAM employs both local and foreign legal consultants to effectively service client requirements.

For more information contact +66 76 326 322 or visit www.siam-legal.com
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Häfele Wins The Unplugged Award

The recent Architect Expo 2008, held in Bangkok is the largest event for architectural innovation in Asia. The Häfele booth was outstanding with a unique display of products and services that focus on conserving the environment by using environmentally friendly materials and consuming the least amount of energy. For these reasons, Häfele was honoured with Unplugged Award at the Architect Expo 2008, which will be encouraging for the company’s commitment and attention to respond to the current threat posed by global warming.
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