Message-ID: <3.0.3.32.19971202161610.0075a978@aloha.net> Date: Tue, 2 Dec 1997 16:16:10 -1000 From: Jay Hanson <mailto:j@QMAIL.COM> Subject: The market in no way reflects the depletion of oil. To: mailto:DEVEL-L@AMERICAN.EDU
At 07:06 PM 12/2/97 -0500, Jonathan Sanford wrote:>No gas shortage observed here (Washington, D.C.) or in Northern California,
>during a recent visit. Likewise, no gas shortage was experienced and prices
>were reasonable this last summer all the way from Washington DC to
>Michoacan state in Mexico. I didn't even see a gas line. Iraq has been pretty
>much out of the oil market for a couple years, but that doesn't seem to have
>driven up prices. If their export quota is increased, then there'll be more
>supply available.
I hate to tell you this Jonathan, but the market in no way reflects the depletion of oil. This is why by only looking at prices, economists have got a clue as to what's going on in the world.
Recently, a group of oil experts have stated that global oil production is going to "peak" in a couple of years. And yet a couple days ago, OPEC (led by the Saudis) raised oil quotas.
What the story?
The Saudis raised quotas because they are our friends, and the optimum oil price for the US economy is about $20 a barrel!
According to Peter Schweizer [1], the Saudis cooperate with the US in exchange for intel on dissidents [p. 31], satellite pics, AWACS [p. 51], Stinger missiles [p. 190], advanced fighters, direct military protection, and were even "leaked" information when Treasury Department planned to devalue the dollar so they could shift investments into nondollar assets. [p. 233]
During the Cold War, the Saudis worked in the black with the CIA to lower global oil prices and thereby deprive the USSR of the much-needed hard currency it needed to operate. Each $1 drop in oil price cost the USSR about one billion dollars in revenue.
A $5 drop in the price of a barrel of oil would increase the U.S. GDP by about 1.4 percent. Poindexter: "It was in our interest to drive the price of oil as low as we could". [p. 218]
Weinberger: "One of the reasons we were selling all those arms to the Saudis was for lower oil prices." [p. 203]
Alan Fiers: The Saudis were also providing financial aid to the mujahedin and the contras. [p. 202]
"In the first few weeks of the Saudi push, daily production jumped from less than 2 million barrels to almost 6 million. By late fall of 1985, crude production would climb to almost 9 million barrels a day." [p. 242]
"Shortly after Saudi oil production rose, the international price of oil sank like a stone in a pond. In November 1985, crude oil sold at $30 a barrel; barely five months later it stood at $12." [p. 243]
"In the spring of 1986, the downward plunge in international oil prices was causing serious worries around the world but also among some quarters in the Reagan administration. Vice President George Bush was preparing for a highly visible ten-day tour of the Persian Gulf area. A product of the Texas oil country, Bush saw danger, not hope, in the dramatic and recent decline in oil prices." [p. 259]
Bush was acting on his own against the Reagan administration! While Reagan, Casey and Weinberger were trying to talk oil prices lower, Bush was meeting with Yamani and Fahd trying to talk oil prices higher! [p. 260]
In 1983, the Treasury Department had done a secret study that found the optimum oil price for the US economy was about $20 a barrel. [p. 141]
That why we have oil prices close to $20 a barrel!
I am surprised that Schweizer's GREAT book hasn't been made into a movie! _________________ CONSPIRACY THEORY Campbell [2] doesn't know whether to believe the Gulf War conspiracy theory or not, but it goes something like this:
After the Cold War was over, low oil prices made it difficult for the Saudis -- and oilman President George Bush's friends -- to make ends meet because OPEC members were cheating on quotas.
The obvious solution to OPEC cheating was to sequester an entire country: Iraq. In order for our scheme to work, Saddam would have to remain in power and the UN would have to embargo his oil. That's exactly what we did.
We only to keep Saddam in power for a few years -- till the rest of the world's oil production "peaks". ______________ JAY SPECULATES Once global oil peaks, and we NEED to start pumping Saddam's oil, I expect Americans to invade and OCCUPY Iraq. Moreover, profits will flow to friends of George Bush -- not some wild-eyed, gun- waving crackpot like Saddam.
Obviously, once oil production peaks in a couple of years, the public will throw their total support behind an invasion of Iraq. There is simply no other way we can guarantee access to the oil patch.
I didn't know we had an "energy policy" in this country. It turns out that we do: keep oil prices close to $20 a barrel.
I'm impressed, this scheme is really quite clever. But it sure make the economists look stupid. <G>
[1] For a fascinating account of how American government operates in the black, read VICTORY: The Reagan Administration's Secret Strategy That Hastened the Collapse of the Soviet Union, by Peter Schweizer; Grove/Atlantic, 1996; ISBN 0871136333 http://www.amazon.com/exec/obidos/ISBN=0871136333/7316-8640065-053141
[2] Campbell's is the best book BY FAR on oil depletion, read THE COMING OIL CRISIS, by C. J. Campbell; Multi-Science Publishing Company & Petroconsultants, 1997 ISBN 0906522110 See a review and order it now from Amazon books: http://www.amazon.com/exec/obidos/ISBN=0906522110/3088-4711339-639335
For more on running out of oil, see: FOSSILGATE at http://dieoff.org/page122.htm
Jay -- http://dieoff.org/page1.htm ----------------------------------------------------- Sustainable development both improves quality of life and retains continuity with physical conditions. To do both requires that social systems be equitable and physical systems circular. -----------------------------------------------------