Al Whitlock al_whitlock at
Tue Nov 9 13:13:40 MST 1999

Re Louis Proyect post on oil linkages to current issues in Balkans, Chechnya

Oil's a bit of a double edged sword economically.  The single most important
sector of industrial capital is that concerned with petroleum products.  Oil
prices have been in the doldrums for a decade or more, with spot prices not
so long ago falling to pre-1973 levels, which posed considerable threats to
interests of oil transnationals.  There's been a rise recently.  Yet, the
opening up of parts of the FSU  and China to these majors has revealed
extremely large potential reserves, including those around and beneath the
Caspian Sea.  Their entry onto the market suggests a possible glut sitation
and a further round of price collapse.  While that might seem to be an
advantage to the remainder of industrial capital, it could spell disaster
for large sections of the oil sector, particularly by forcing Alaska,
lower-48 onshore fields, the North Sea, the potential Malvinas basin and
lots of others regarded as "secure" off the scene.  That would be greatly to
the advantage of the Gulf producers,and Libya, where costs are minimal,
thereby further strengthening the OPEC.

While Louis Pryect could be correct in surmising some of the "deliberations"
have had an oily context, it seems to be far deeper than he suggests.  The
decline of oil prices, and their increasing uncertainty has driven majors,
Shell in particular, into staggering investment in biofuels - both R&D and
massive land purchases.  But that's a whole new can of worms, regarding the
contradictry position of capital vis vis environmental issues like global

Maybe there's a chance in discussing the oil-question to get a bit deeper
into how capitals inner contradictions are beginning to work out to the
surface.  Clealy can't separate that from things like Balkans and Chechnya.

Al W

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