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The Secret, Simple Reason For High Oil Prices

Why are  oil prices so high, after inflation above 1980 record highes? Peak oil enthusiasts have explanations (usually wrong, like their forecasts). There are many factors at work, including one simple but hidden reason: American foreign policy. The USA has played a large role in the suppression of oil production in three major oil producers, including two nations with some of the world’s largest petroleum reserves — and having the greatest potential for increased production. Perhaps it’s a coincidence that we’ve intervened in three oil producing nations, and high oil prices are an accidental by-product of our good intentions. Contents Iran Iraq Libya Another perspective For More Information (1)  Iran After a long history of interference in Iran’s government, we initiated an ever-tightening and broadening array of sanctions on Iran after the 1979 revolution — continuing until today. See a list here ; Wikipedia has details on US sanctions […]

Posted On : Published By : Tom Whipple
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Can an Economy Develop Without Coal?

While all fossil fuels are contributing to the accumulation of carbon dioxide in the atmosphere, coal stands apart as really problematic, not just because of its CO2 emissions today (see chart, global emissions in millions of tonnes CO2 vs. time), but because of the vast reserves waiting to be used and the tendency for an emerging economy to lock its energy system into it. Global energy emissions I recently came across data relating to the potential coal resource base in just one country, Botswana, which is estimated at some 200 billion tonnes. Current recoverable reserves are of course a fraction of this amount, but just for some perspective, 200 billion tonnes of coal once used would add well over 100 billion tonnes of carbon to the atmosphere and therefore shift the cumulative total from the current 580 billion tonnes carbon to nearly 700 billion tonnes carbon; and that is just from Botswana. […]

Posted On : Published By : Tom Whipple
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Oil Reflects Libyan, Iraqi Tension

Brent crude oil appeared stable Tuesday morning, recovering some ground from last week’s falls on news of ongoing violence in Libya and renewed confusion in Iraq. ICE September crude was down 0.02% at $105.39 a barrel. On Monday it dipped as low as $104.52 a barrel. September WTI crude on the Nymex exchange was up 0.25% at $98.54 a barrel. "For some days, the market focused entirely on ample physical supplies, but they now seem to be paying more attention to the supply-side risks again," wrote analysts at Commerzbank in a note to clients. The situation in Iraq remains unclear, they said, after fighting between Kurdish forces and militants over some oil installations. Exports from the south of the country amounted to 2.44 million barrels a day in July, according to the oil ministry, slightly more than in June. However, Commerzbank says that according to shipment details oil exports […]

Posted On : Published By : Tom Whipple
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WTI Trades Near Three-Day High Before U.S. Supply Data

West Texas Intermediate crude traded near the highest price in three days before supply data that will signal the strength of fuel demand in the U.S., the world’s biggest oil consumer. Brent in London was steady. Futures were little changed in New York after snapping a five-day losing streak yesterday. Gasoline stockpiles probably fell for the first time since June last week, according to a Bloomberg News survey before a government report tomorrow. Kurdish fighters in Iraq retook northern border towns seized by militants from Islamic State, a breakaway al-Qaeda group, the Kurdistan Democratic Party said on its website. “The market seems to have marked the bottom of its recent sharp downward correction,” Christopher Bellew , senior broker at Jefferies Bache Ltd. in London, said by e-mail. “Prices are holding as geopolitical tension offers support.” WTI for September delivery was at $98.49 a barrel, up 20 cents at 8:58 […]

Posted On : Published By : Tom Whipple
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Natural Gas Gains as August Forecasts Turn Hotter

Natural gas advanced Monday on expectations that current low prices could spur additional demand, especially with some above-average temperatures expected this month. Natural gas for September delivery settled up 3.6 cents, or 1%, at $3.834 a million British thermal units on the New York Mercantile Exchange. Weather forecasts released Monday called for above-average temperatures on the West Coast and in Texas in the next six to 10 days, though moderate weather is still expected in the east. "Domestic weather models are finally seeing something resembling normal summer temperatures," said energy-advisory firm Gelber & Associates in Houston in a note. "The increased power demand that will come with normal summer temperatures will accentuate the current preference for natural gas." Prices are still trading near their lowest point of the year, as a mild summer has reduced demand for gas-powered electricity to fuel air-conditioning units and allowed […]

Posted On : Published By : Tom Whipple
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Libyan responders flee fuel depot fire

A fuel fire near the international airport in Tripoli may be on the verge of creating a humanitarian and environmental disaster, the Libyan government said. The Libyan government said a fuel depot near the airport suffered a direct hit after militias armed with heavily artillery surrounded the area. "This led to the withdrawal of firefighters," Sameer Kamal, spokesperson for the Ministry of Oil, said Sunday . The spokesman said the smoke and fire could present a major threat to the surrounding area in Tripoli. At least 200 people have died as a result of fighting between Islamist militias and pro-government forces since July. Foreign governments, including the United States and European powers, have suspended diplomatic operations in Libya because of the recent outbreak of violence. The interim government in Tripoli said last week it needed outside help in controlling the violence. International forces intervened in Libya’s […]

Posted On : Published By : Tom Whipple
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Libyan lawmakers elect judge as new speaker

Libyan lawmakers, gathered far from the country’s chaos and warring militias, have elected a judge as the new parliament speaker. Ageila Saleh Eissa narrowly defeated his rival for the post, Abu-Bakr Baeira, in a 77-74 vote late Monday night from among 158 lawmakers who convened the parliament’s inaugural session in the eastern city of Tobruk. Weeks of fighting in the capital, Tripoli, and the nation’s second-largest city, Benghazi, have killed more than 230 people and forced most foreigners and diplomats to leave Libya. Because of the violence in Tripoli and Benghazi, the parliament session was held in Tobruk, an anti-Islamist stronghold and a militia-free zone. Eissa is the country’s third parliament speaker since the downfall and killing of longtime dictator Moammar Gadhafi in the 2011 uprising and civil war. He held several judicial posts in the east under Gadhafi but his political affiliation is unknown. […]

Posted On : Published By : Tom Whipple
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Border Fighting Intensifies Between ISIS and Lebanon

A deadly confrontation worsened on Monday between Lebanon’s armed forces and Islamist insurgents from Syria who seized the border town of Arsal over the weekend in what appeared to be the most serious spillover of the Syrian civil war into Lebanese territory since the conflict began more than three years ago. The Lebanese Army said in a statement that its forces were engaged in fierce battles with the Islamists in Arsal, where witnesses reached by telephone, including the deputy mayor, said shelling had hit the town from multiple directions and thousands of residents had fled. Arsal is also one of the temporary homes for many of the Syrian war refugees who have sought sanctuary in eastern Lebanon, and witnesses said Lebanese Army checkpoints were refusing to let the refugees relocate deeper into the country. Some refugees said they were panicking because they had nowhere to go. […]

Posted On : Published By : Tom Whipple
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Peshmerga in Ceasefire with IS South of Kirkuk at Tribal Behest

Kurdish Peshmerga forces have declared a three-day unilateral ceasefire south of Kirkuk after a demand by Arab tribal chiefs in the area. Peshmerga military officials in the town of Daquq told Rudaw that Arab tribes had asked for the ceasefire – that started Saturday evening —  to give them a chance to try and persuade Islamic State (IS/ISIS) militants to leave the area. The tribes fear that a resumption of fighting between the Peshmerga and IS would cut off the Kirkuk-Tuz Khurmatu highway and affect many ethnically-mixed villages that lie in the frontlines. Meanwhile, Kurdish commanders said they fear that the Islamic militants might use the truce to regroup and bring in reinforcements from elsewhere. Until now the Sunni militants, who have declared an Islamic State straddling large parts of Iraq and portions of Syria, had locked in sporadic clashes with […]

Posted On : Published By : Tom Whipple
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Islamic State seizes town of Sinjar, pushing out Kurds and sending Yazidis fleeing

The ancient northern Iraqi town of Sinjar emptied Sunday, with thousands of people fleeing on foot as Sunni extremist militants made their first significant punches through the defenses of overstretched Kurdish forces. Sinjar is an ancestral home of the long-persecuted Yazidi religious sect, which the Islamic State has branded as devil worshipers, and few of its residents stayed to find out what was planned for them when the group’s militants entered Sunday. Until Sunday, Sinjar had been protected by Kurdish fighters known as pesh merga, but officials from the semi-autonomous northern region have been warning for weeks that they are poorly equipped to sustain the defense of the nearly 650-mile border they now share with the militants. The town of Wana also fell Sunday, putting the Islamic State within striking distance of Mosul’s hydroelectric dam, the largest in the country. After nearly two months of skirmishes, it […]

Posted On : Published By : Tom Whipple