 |
 |
||
|
|
|||
 |
|||
|
|
|||
|
Why Gasoline Will Cost a Lot More Finding, extracting, transporting and refining crude oil is a very expensive business. It is also a very risky one. There are no guarantees that one will find oil and, finding it, there are no guarantees that the investment and all the assets involved will not be stolen by the governments that invited oil companies to tap their natural resources. If you want to know why gasoline and everything made from oil is going to cost more in the years ahead, I give you, ladies and gentlemen, Hugo Chavez, dictator of Venezuela, and a number of other nations who have engaged in extortion.
In power since 1999, this disciple of Fidel Castro fired 75% of the managers of the state company after they staged a strike in 2003. Only the increased investment by foreign-owed companies kept Venezuela’s oil industry from total implosion. This year he showed his appreciation by forcing out British Petroleum, Chevron, Total, and Norway’s Statoil. ConocoPhilips and Exxon Mobil Corporation have since concluded they too could not continue their operations in Venezuela. The popular myth about Big Oil is that it wields such great power that nation states cannot resist them. The reality is that, faced with dictators like Chavez, often the only alternative is to leave or cut the best deal they can. The other reality is that Venezuela’s oil production has declined 25% since Chavez, a committed Communist, crushed the strike. With the major oil companies departing, how much greater a decline lies ahead? That is just one reason gasoline will cost more. Russia may no longer be officially Communist, but it continues to be run like a Communist state. As Business Week recently reported, in June Russia "forced BP to sell a controlling stake in a massive east Siberian gas field called Kovykta for around $700 million—a fraction of the project’s potential value. Last year, Moscow strong-armed Royal Dutch Shell PLC into giving up control of its big Sakhalin II gas project in the Far East, and it’s now battling Exxon Mobil over a similar field nearby." Our neighbor to the south, Mexico, won’t even allow foreign investment in its oil industry. Its nationalized oil company, Pemex, needs lots of capitol investment, but isn’t getting it. That may lead to a decline in production. Add to this the situation in Iraq that has caused a decline in oil production. Who can say what events will occur in Iran if it continues its intention to build nuclear weapons? Then add in the worldwide oil industry’s need to grow by at least 3% annually to keep up with demand. You’re looking at a world that needs new production estimated at four million barrels per day and it’s not going to happen. You don’t just create production or refining capacity overnight. It requires lots of money, something the free market Big Oil companies have been willing to risk up to now. That’s something Communists don’t do. There are other options, but right now the Democrats that control the U.S. Congress, led by Speaker Pelosi and Sen. Harry Reid, are howling like moon-besotted coyotes that the United States must become "energy independent." Congress is refusing to allow known, vast oil reserves in Alaska to be extracted, nor facilitating exploration and extraction of other potentially vast reserves of oil and natural gas off the continental shelf of the United States. Indeed, they want to punish Big Oil for whatever profits they may have garnered from their investments in the Gulf of Mexico. The vast matrix of insane "environmental" laws and regulations has made it impossible, i.e. unprofitable, to build a single new refinery in the United States since the 1970s. The New York Times recently reported that mechanical breakdowns in U.S. refineries "have created a bottleneck in domestic energy supplies", helping to drive up the cost of gasoline. Even if an oil company was to begin construction tomorrow, you’re still years away from it coming on line. Instead, the Democrats are wailing about "global warming" and "climate change", demanding the imposition of "cap and trade carbon credits" and, in general, racing toward the worst possible choices for a nation whose energy needs are being ignored in the name of fraudulent science and pure politics. These are things you need to think about as the cost of a gallon of gasoline goes up at your local gas station or the price of heating oil rises as winter closes in on the northeast and elsewhere.
The mandated, increased production of ethanol from corn that Congress has imposed is already driving up food costs. Ethanol is so corrosive it cannot be sent through pipelines, so imagine what it doing to the engine of your car? As for the trucking industry on which the nation depends for the delivery of practically everything, its increased costs will just add to the cost of practically everything. It is a "perfect storm" of international criminality when Communist thugs and others decide to line their pockets and bully the rest of the world. This is the kind of thing that leads to wars. The analytical and editorial skills you see on display here each week are also available to you. Visit www.caruba.com to learn how your communications needs can be fulfilled. The Madness of the Middle East By June, the whole of the Middle East had hit the boiling point with armed conflict breaking out in Lebanon, on the Kurdish borders of Turkey, and between Hamas and Fatah in Gaza. The conflicts in Afghanistan and Iraq continue as al Qaeda takes credit for the mayhem. I am not a betting man, but I would be very surprised if Iran, Syria and their proxy Palestinian armies, Hamas and Hezbollah, were not again fighting Israel before the end of summer or by early fall. Lebanon would be in flames again and, from there, who knows?
There was a time long ago when they could fight. Arabs look back at Suleiman repulsing the invasion of the crusaders as an example. In general, though, Arabs were petty raiders of passing caravans, invaders of small cities in search of booty and slaves, and they were disinterested in a national identity. Even today, their nations are mostly just tribes with flags or the inventions of England of France after WWI. Turkey, seat of the great Ottoman Empire that ruled over most of the Middle East until after WWI, has proven an exception. Mustafa Kemal, better known as Kemal Ataturk, made his mark as a general and then led Turkey to become a secular nation, free of the retrograde hand of Muslim clerics. Saddam Hussein invested billions in building a huge military, but was unable to defeat the Iranians and vice versa. After eight years and millions of lives lost on both sides, they called off the war. Saddam then promptly invaded tiny Kuwait in an effort to seize its oil fields. That effort was repulsed by Bush41. In 2003, Bush43 initiated the subsequent U.S. invasion to rid the Middle East of this troublemaker. What followed was a conflict between Shiites and Sunnis. Since 1948, the major excuse for war in the Middle East has been the nation of Israel. The Arabs contend there never was a nation of Israel 3,500 years ago, nor even that Jerusalem was its capitol. Their hatred of Jews, Christians, Hindus and all non-believers, renders them indifferent to the ancient texts of other religions far older than their own. Instead, following the United Nations partition of the former British Protectorate of Palestine, Israel was attacked, but succeeded in driving off the Arab armies. Offered a nation of their own by the UN, the area’s Arabs, thereafter to be called Palestinians, refused. Thus began the oldest, sustained refugee problem in the history of the world. The mere presence of Jews whose ancestors had lived in Israel as long as Arabs had lived in the Middle East was intolerable. Islam reinforces anti-Semitism. In 1967, the Egyptians, Syrians, and Jordanians massed their troops and, in six day’s time, were soundly defeated, leaving the Israelis with even more territory under their control than before. Forty years later, the grandchildren of those Palestinians who chose war over peace are still at it. They are sustained in this effort by Iran, Syria, and other Arab nations who prefer that Palestinians do the dying. If there were an ounce of common sense to be had from anyone anywhere in the Middle East, there would not be one American, British or EU soldier to be found there, except for those guarding the gates to embassies. But no. Instead, by invading Afghanistan the former Soviet Union set off, not only its own demise, but the ill-conceived notion that Arabs could actually fight a war and win. The Afghans were logistically supported by the CIA as part of the Cold War and then joined by restless Saudi youths seeking glorious martyrdom. Claiming success in Afghanistan and five years before September 11, 2001, Osama bin Laden had made clear that he intended to strike the United States, but his threats were lost among the endless babble of Islamic hatred that flows freely every day throughout the Middle East. His original goal was to drive Americans from the "sacred sands" of Saudi Arabia where they had been protecting the sacred backsides of Saudis from the predatory inclinations of Saddam Hussein. As Osama saw it, "All these crimes and sins committed by the Americans are a clear declaration of war on Allah, his messenger, and Muslims." The fact that Americans had earlier tried to be peacemakers in Lebanon, defended Muslims in an essentially undeclared war in Kosovo, and spilled their blood in Iraq to restore the Kuwaiti royal family to power, meant nothing to bin Laden. Why let a little thing like reality interfere? Arabs are not strong on reality. Not a week goes by when its mosques are not filled with messages of hatred for America and Israel. In his new book, "In the Words of Our Enemies", Jed Babbin fills page after page of the insane ranting of Muslim clerics and others who have concluded that America is the Great Satan and Israel is the Little Satan. Both, along with England, are blamed for all the troubles of the Middle East. As a Palestinian cleric said one week after Yasser Arafat’s Intifada had taken innocent lives in Tel Aviv with suicide bombings, "Allah willing, this unjust state will be erased—Israel will be erased; this unjust state, the United States, will be erased; this unjust state, Britain, will be erased—they who caused this people’s Nakbah (the 1948 ‘catastrophe’)." Apparently these nations were to be erased by the mighty wrath of Muslims, but a new group, Hamas, even more devoted to the destruction of Israel, had plans of its own for Palestine. Financed by Iran, which also finances Hezbollah in Lebanon, the world now looks at Palestinians with the same fondness restaurant patrons have for cockroaches. The possibility that Palestinians have been the authors of their own troubles is never entertained and this notion is widely held throughout the Middle East as the citizens of nations like Egypt, Jordan and Syria—each defeated in war—continue to believe that no disaster that befalls them from Beirut to Baghdad, Damascus to Kabul, and anywhere else in the region is ever their fault. Similar apocalyptic sentiments have been heard from Iran since it took American diplomats hostage in 1979 and held them for 444 days. Its oligarchy of Islamic clerics with Mamoud Ahmadinejad as its smiling, but totally insane front man continue their quest for nuclear weapons to lead the battle against America, Israel, Britain, the West and the whole world until Islam rules supreme. This nightmare is beginning to reach fruition as the entire region has erupted in low- level conflicts wherein Muslims are killing Muslims in the ultimate hope of killing the infidels whom they deem the source of their problems. If it continues, a lot of Muslims are going to die because Americans, Israelis, and others are growing tired of dealing with hostage takers, suicide bombers, and the potential for their own destruction if they linger too long in the hope of peace. Knowing history and relating it to present and future times is part of what the Center does every day. Your donation is needed to underwrite the time and effort this requires. Please give what you can to the Center to keep our weekly commentaries and our communications programs active. Thank you!
©
2007 Alan Caruba. |
||||||||||||||||||||
On June 26, Hugo Chavez told the Big Oil companies that had invested in Venezuela’s Orinoco Belt that they were going to have to sell their assets at a ridiculously low price to Petroleos de Venezuela (PDVSA), the state oil company. They were instructed to hand over majority control as part of Chavez’s nationalization program.
The virus of the 1979 Iranian Islamic Revolution has metamorphosed into a cancer infecting the entire region and, were it not for the Arab’s famous inability to mass an army and actually fight a modern war, there is little doubt the whole region would be engaged in warfare by now.