They're still at it and set the clock to 5 minutes to midnight this January.
“They say the world's biggest threat is the ‘potentially civilization-ending’ outsized nuclear stockpiles of the United States and Russia, along with the growing arsenals in India, Pakistan and China.”The nuclear arsenals of rational civilizations don't particularly scare me, but if they're setting it to five minutes based on that, I suggest it needs to be pushed up to one or two minutes to midnight. Not because of a nuclear war but an economic apocalypse that has just jumped up in possibility. I'm talking about the effects on oil prices of a widespread civil war in the Mideast.
T. Boone Pickens said last week that if just Iraq's oil were to go off the market, we could looking at $200/barrel oil. That number has been echoed by other analysts. The west simply couldn't survive that shock - the economies are too fragile right now. With $105/barrel oil, regular gas averaged $3.66 this week. For a rough guess of the effects of $200 oil just double that to $7.32. That would increase the price of everything, and start a spiral into drastic economic slowdown and then collapse.
Is that going to happen? Are you a betting person? ISIS, the group behind the war in Iraq, isn't shy about declaring they want a caliphate. Do a Bing News search on Caliphate and you'll find some analyst saying "Not Gonna Happen" and an administration (DHS) droid saying "The Return of the Caliphate is 'inevitable'". The thing is, I don't think the establishment of a caliphate is a necessary part of this picture. The essence is a re-heating of the perpetual Sunni-Shia conflict into an open civil war that takes out oil fields. While each individual group may want to control the oil fields to fund themselves, the other side will be more than happy to destroy those fields to help destroy their enemies. So what happens to the price of oil if Iran takes out Saudi Arabia's oil fields? What if the entire region becomes embroiled in a widespread war? If one country puts it to $200, where does it go if multiple countries go down?
Might I suggest that it's higher priority than usual to make sure you're ready to put your apocalypse plans into place at a moment's notice? Check your water and your food, gas up your cars, verify all your comm links and anything else? There may only be a matter of hours of notice that it's going all tango uniform.
We have more than enough oil in the US to tell the Arabs to take a hike, except the greenie-weenies won't let us get to it.ReplyDelete
But then you already knew that.....
I think it goes beyond oil. I read a simple statement that I believe is 100% true: "A radical muslim wants to kill non-muslims. A moderate muslim wants radical muslims to kill non-muslims." I admit it sounds a little strident. But look at a country where the majorit are muslims and you will see moderate muslims killing Christians and moderate muslims fail to speak up against it or make any effort to stop it. In fact in this country moderate muslims have been interviewed and asked directly if they would criticize radical muslim violence and Sharia law and they refused. The muslim world is in constant internal war and destruction and the muslim world keeps overflowing it's borders into formerly non-muslim countries. Unless this trend is reversed there is really only one possible outcome and that is open warfare between the muslim and non-muslim world. How this will begin or end is anyone's guess. I think the most likely possibility is a serious (perhaps nuclear) terrorist act in a major European or American city. Let's be honest about this; once they do that all bets are off and we are at war.ReplyDelete
Actually, the US increase in oil production has created enough extra capacity worldwide that prices didn't move much when libya went offline 2 years ago (and has, for the most part, stayed off line), when Iran went offline due to sanctions last year, and that same excess capacity is keeping prices fairly stable now with turmoil in Iraq. Yes, additional turmoil is a bad thing - but at this point it is unlikely to be a global shock.ReplyDelete
Don't get me wrong: I'm an absolute fan of the current US oil and natural gas resurgence and strongly believe the feds should get out of the way and allow it to grow. Unfortunately, the fact remains that we produce about 8M barrels a day and use 18M. That shortage has to be made up from somewhere.ReplyDelete
We get most of our imports from Canada, but oil is the very definition of a fungible commodity, and the domestic production will not keep the price from skyrocketing if the Mideast goes up in flames.
Anon 2257: Word. As far as I can tell, complete truth.
A real live caliphate in 2014? Gettin all medieval and shit? Wow, imagine that.
I find it appalling that there are those who would applaud such a development in the ME, esp since we all know that the one thing that's been giving the CIA nightmares since 1962 has been the idea of Arab Union, whatever form it took.
Strange days, indeed.