ABC, 123, Do Re Mi

Charles Jannuzi b_rieux at yahoo.com
Wed Jan 22 02:08:37 MST 2003


DS wrote:

>> Let me turn
>> the question around. "Why now?"  Why is the
fear of depletion strong
enough
>> to propel capital to war now?  Why not in 1973
at the first oil crisis?
Why
>> not 1979-80?  Was the 1991 war a battle over
depletion?  Why now, if the
>> time to depletion doesn't matter?

Margaret replied:

>First off, we don't KNOW the time to depletion,
>though my guess would be
>there ARE people who do know and for whom this
>timetable may make sense.
>That aspect is simply unknowable to those of us
>not privy to information at
>the highest levels of government.  We can only
>make inferences and
>conjectures.

>Secondly, the opportunity and will may not have
>been there to make a move on
>Iraq in those other years.  These are factors
that have nothing to do with
>profit at all, but political realities - the
>composition of the people in
>power in the U.S., a weakened Iraqi state and
>the absence of a Soviet
>deterent, to name some of the more obvious.

Here's what I think:

1. The decision to get serious about regime
change in Iraq goes back to the Senate in 1998-9,
when key Democrats (Biden, Lieberman)and
Republicans (McCain) agreed to fund a whole wave
of activities and groups in order to achieve
this.

2. Remember, Clinton II did order the heavy
bombing of Iraq, quite likely with the idea that
the US should test some of its 'precision'
weapons and other weaponry--to see if they really
could get Hussein hunkered down somewhere--and to
prod Iraqis to get rid of Hussein, because he
would be seen as the source of all their misery.
In fact, the US military forces were also getting
ready for a ground war at the time the air
campaign was carried out.

3. Oh, no, back to oil depletion. Actually, the
first key date is 'peak production'. Going around
various sites associated with 'hydrocarbon
capitalism', I'd say three timeframes came up the
most often. AT CURRENT LEVELS OF INVESTMENT IN
NEW PRODUCTION AND ENHANCEMENT OF PRESENT
PRODUCTION, some said something like 2005, others
said 2015, and other said beyond 2025. The
majority of people in hydrocarbon capital seemed
to think an optimistic but realistic date was of
2015 is most likely.

With a date like 2015, isn't it possible that
even the futures markets in oil and gas haven't
even got around to the concept?

Recommended reading:

http://www.hubbertpeak.com/laherrere/Petrotech090103.pdf

4. A different theory of geopolitics and oil
vis-a-vis Iraq is quite possible here (that is,
in answer to the question why Bushboy would get
the whole national security state apparatus
geared up to do it all over Iraq). Remember, in
1998, the price of oil was very low, even below a
relatively low historic average (so below even
$15 per barrel). At one hydrocarbon site, here is
what businesses reported concerning low oil
prices in 1998:

http://www.oil-gasoline.com/qodarch.asp?expand=27#result

>>How did the low oil prices of 1998 hurt you or
your company? 5/17/1999
Company failed  12.90%

Took a loss for the year  51.61%

Broke even  3.23%

Made a profit, but lower than 1997  9.68%

Low prices were great for us!  22.58%<<

And what was brewing on the geopolitical scene at
that time (when oil was cheap but due to rise
drastically til the price peaks at the end of
1999 and into 2000, peaks that match the price
now, btw)? First, Iraqi oil was becoming
increasingly important again in world markets, so
once again it was having an effect--an effect
that would help bring about lower oil prices. Or,
alternatively, in a world with higher prices, it
meant Iraq was getting more money from its oil
sales.  And that is not an effect many in the US
national security state wanted. One, they didn't
want Iraqi to have an effect, period. And two, if
oil prices are down and Iraq is selling oil, they
wouldn't want that either.

Here is what the same hydrocarbon capital site
said in that regard:

>> Increased production from IRAQ  5/25/1999
will depress world crude oil prices.  70.00%

won't have much impact on the overall supply or
prices.  30.00%

will cause prices to increase because it is high
quality oil in high demand.  0.00%  <<

And a second thing was happening: Europeans and
E. Asian countries were ignoring US trade
sanctions against IRAN and going ahead with oil
and gas deals to please themselves and Iran. That
is very alarming for the way the doctrinnaire
boys and girls at the US national security state
think about the world and the world economy and
oil's place in them. Very alarming indeed.

So if you can start to think like Zbigniew
Brzezinski--yes, something many on the left would
be loath to do--instead of thinking only in
normative terms--you can quite easily motivate
the US empire's desire to wage war on Iraq (sure,
ZB is against the current campaign against Iraq,
not because he is a man of peace, but because he
wants the US to terminate Al Qaeda and 'errant'
Islam first).

So the national security state people have
weighed the pluses and the minuses and the pluses
far outweigh the minuses (and I can start to list
a whole lot of pluses for them if you need them).

I might add that by 1999-2000, gas prices were
also spiking (how convenient, now that so many
households and even industrial users had made the
switch), and my theory is that this is an effect
based almost entirely on speculation and the
pernicious activities of companies like Enron in
deregulated energy markets.

See what the capitalists thought at the same site
I've already cited twice:

>>hy are natural gas prices so high? 8/25/1999

No logical reason.  9.38%

Supplies are short.  34.38%

Price always goes up in the fall.  12.50%

It's a temporary speculator thing.  43.75% <<

Conclusion: it might sound thrilling to say that
oil depletion is upon us, a sense of crisis over
it drives US foreign policy, capitalism will be
plunged into a crisis (but remember, capitalism
thrives on the crises that affect laboring
people), and something better will result. Or, it
might sound typically socialist to say, Bush is
going to attack Iraq for the oil.

But it's not about oil. It's about control of the
price and supply of oil. That will be the
struggle right down to the last extractable drop,
so long as oil and gas are primary sources of
energy.

In this scheme of things, Iraq is important. Even
if it didn't have oil abundant enough to export,
just like Afghanistan, it would be important
simply because of its location (though without
oil, Iraq would probably look a lot like
Afghanistan--a ripped up piece of the puzzle in
the great game over control).

I leave you with more from that industry site and
one more recommended reading:

>>The next President of the U.S. will be :
11/14/1999
a Democrat  14.06%

a Republican  79.69%

an Independent  6.25%


Crude oil prices are: 1/16/2000
Too high  58.33%

Not high enough yet  0.00%

Just right  25.00%

Coming down soon  16.67%


Why are crude oil prices increasing? 5/14/2000

Demand for crude oil is increasing
internationally.  0.00%

There is a shortage of light, sweet crude oil.
11.11%

High product prices in the US are driving crude
oil prices.  33.33%

Speculation in the futures market.  55.56%

OPEC is causing it.  0.00%

Should the US invest more in production of
domestic oil? 7/16/2000
Yes.  87.50%

Yes, for strategic security reasons  12.50%

No, it is better to depend on other countries to
provide our oil - share our wealth  0.00%

No.  0.00%


Do you think there is an impending natural gas
shortage? 9/4/2000
YES  28.57%

NO  71.43%

NOT SURE  0.00%<<

http://www.gasandoil.com/goc/news/ntn12757.htm

Charles Jannuzi
I walk to and from work everday!
Fukui, Japan








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