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Oil scarcity and high production costs a myth?
U.S. policy in the Middle East is driven by baseless fears that an "oil
weapon" can cut off our fuel supply, a Johns Hopkins researcher has concluded. In a peer-reviewed journal article, Roger J. Stern argues that the decades-old belief that petroleum-rich Persian Gulf nations must be appeased to keep oil flowing is imaginary, and the threat of deployment of an "oil weapon" is toothless. His review of economic and historical data also shows that untapped oil supplies are abundant, not scarce. Stern's analysis, titled "Oil market power and United States national security," appears in the Jan. 16-20 online Early Edition of Proceedings of the National Academy of Sciences. In the article Stern argues that the longstanding U.S. security concern that our oil supply could be threatened is wrong. The real security problem, says Stern, comes from market power. Persian Gulf oil producers, he says, collude to command artificially high prices that could never exist in a competitive market. Excessive OPEC profits result, he says. These contribute to instability in the region, terror funding and the likelihood that a Persian Gulf superpower could emerge if one state captured the oil production of its neighbors. Because of these threats, the United States has concluded it must use military force to block state-on-state aggression in the region and to contain terrorism. "U.S. appeasement of the oil market power not only helps create these problems, it makes them inevitable," said Stern, a doctoral student in the Department of Geography and Environmental Engineering. "Why do we follow this schizophrenic policy? We do it because we believe the 'oil weapon' might be used to reduce our supply if we somehow offend the OPEC countries. My research shows the oil weapon is completely implausible." According to the journal article, recent history shows that attempts to use an oil weapon have consistently failed. The idea, Stern says, dates back to the mid-1930s, when the League of Nations considered cutting off oil to Italy as punishment for its aggression in Ethiopia. The league realized the oil weapon couldn't work, however, because non-league nations could continue to supply Italy. Keeping oil out of Italy would have required a blockade, an idea dismissed as impossible to enforce. What was true for Italy then is true for the United States today, Stern says. By the 1950s, Stern says, the low price of Persian Gulf oil imports jeopardized the profits of smaller U.S. oil producers. To restore shrinking market share, the U.S. oil industry successfully lobbied Congress to limit imports, arguing that reliance on foreign oil would undermine national security. U.S. producers argued that low-priced, abundant imports were dangerous because they might someday be withheld. "The oil weapon of U.S. politics descends from this confection," Stern writes in his article. In the early 1970s, fear of the oil weapon moved to center stage once again. An influential article in Foreign Affairs predicted fuel shortages and economic disaster if the United States did not honor Middle East oil producers' wish that Israel's borders be redrawn. The United States defied this wish, and in 1973 Persian Gulf states unleashed the oil weapon in response. They vowed to cut supplies to the United States if Israel did not return to its 1967 borders. But because the United States could obtain fuel from elsewhere, Stern argues, and because the Persian Gulf nations were dependent on oil revenue, their "attack" was quickly abandoned. Panic buying kept prices high for a while, but actual supply fell only a small amount. Still, fear of a fuel cut-off remained. "Diplomats misread the market," Stern writes. "The oil weapon is impotent, but belief in it is not." Stern's hypothesis is that "threats do arise in the oil market, but not from the oil weapon but from the (OPEC) cartel's management of abundance." Stern said his research shows that since 1970 the cost of extracting oil in Saudi Arabia has dropped by more than one-half, a clear sign of abundance. He argues that Persian Gulf oil prices are being kept artificially high in order to generate monopoly profits for these nations. "Because of oil's enormous returns, Gulf states try to seize control of each others' fields," Stern says. "Iraq invaded Iran and Kuwait for this purpose. Our military is there today trying to keep regional peace and prevent a new superpower. Yet this policy allows aggressive oil states like Iran to grow ever-richer and more dangerous from the product they sell to us." U.S. leaders, Stern says, must stop allowing fear of the oil weapon to dictate foreign policy. Instead, he says, they must find ways to reduce our fuel demand. "It's like we're holding a gun to our own heads: Our belief in the oil weapon constrains our concept of what we can and cannot do in the Middle East and in our own economy," he says. "It also blinds us to the huge opportunity to make ourselves more secure by reducing our oil consumption." John J. Boland, an expert on utility economics and environmental policy who serves as Stern's faculty advisor, said the journal paper, part of Stern's doctoral thesis, raises important issues. "It's a pretty significant article," he said. "One thing Roger does is attack the perception that petroleum is scarce. That's a very unpopular position, one that is aggressively disputed by our government, even though other analysts have also raised this idea." Added Boland, who is a professor emeritus in the Department of Geography and Environmental Engineering at Johns Hopkins: "This paper presents an unpopular perspective that has profound implications for our nation's energy policy and foreign policy." Source: Johns Hopkins University |
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#2
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Oil scarcity and high production costs a myth?
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#3
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Oil scarcity and high production costs a myth?
OK.... YOU have either a point to make or an agenda...... Perhaps you'd like
to educate us "maroons" and "feebs" as to what either or both of these may be.... You are tiresome in your lack of originality..... you are boorish in your subject matter.... and there is squat going to happen from you posting here (I can see your resume now.... you bill yourself as an "activist"..). If you feel so passionately for your subject matter, I suggest you aim at targets that make a difference. My plate is much too full and the "natural" progression of these sorts of things is too far down MY list of priorities to really care. I am ashamed that you consider yourself Canadian..... I pity you in the blind Ontario adhesion to Liberal corruption and cash harvesting (especially from the West).... and I understand that you are either a displaced Newfie or have been cohabitating with them for far too long. |
#4
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Oil scarcity and high production costs a myth?
He (michaelanderson aka Rich etc.) is what happens when an idiot has too
much free time, no life and craves attention. Jim Warman wrote: > OK.... YOU have either a point to make or an agenda...... Perhaps you'd like > to educate us "maroons" and "feebs" as to what either or both of these may > be.... > > You are tiresome in your lack of originality..... you are boorish in your > subject matter.... and there is squat going to happen from you posting here > (I can see your resume now.... you bill yourself as an "activist"..). If you > feel so passionately for your subject matter, I suggest you aim at targets > that make a difference. My plate is much too full and the "natural" > progression of these sorts of things is too far down MY list of priorities > to really care. > > I am ashamed that you consider yourself Canadian..... I pity you in the > blind Ontario adhesion to Liberal corruption and cash harvesting (especially > from the West).... and I understand that you are either a displaced Newfie > or have been cohabitating with them for far too long. > > > |
#5
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Oil scarcity and high production costs a myth?
I don't vote Liberal. Don't you think you are overreacting?
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#6
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Oil scarcity and high production costs a myth?
I just thought the article presented a unique view. After all, the
idiot liberal media is pretty much lock-step in league with the "oil is running out!" B.S. artists and industry hacks. |
#7
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Oil scarcity and high production costs a myth?
- s c r a p e !-
Ever hear of the commodities market? Sure... OPEC is driving it up a little, and a lot of that is based on China Consumption, but they wouldnt have a chance at keeping the price above $50 if it werent for the punters! -- Yeh, I'm a Krusty old Geezer, putting up with my 'smartass' is the price you pay..DEAL with it! |
#8
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Oil scarcity and high production costs a myth?
Don't you think you are "overquoting"? Tell us all... when is the last time
you expressed an original opinion? When is the last time you were able to start a thread without doing a cut and paste? If you're from Ontario and don't vote Liberal, there is every likelyhood that you don't vote (for shame, for shame). Alberta is capitol C conservative.... you have, time and time again, itterated your disdain for the "oil cartel" (Alberta being the oil "sheikdom" of Canada).... The NDP is nothing more than a ballot waster and the Bloc Quebequois - what can you say about a frog??? With no pertinent input.... no problem solving abilities... and the innate ability to provide comic relief that is, strangely, totally bereft of comedy... you offer nothing save for cut and paste quotes from the news media... generally the same, self serving sources, time and time, again. For solution, I can only offer that you remove your hand from your digit, either decide that you will wear Old Spice and brush your teeth and find a lady friend (or break your Dads heart and come out of the closet), putting an end to your foolishness.... or at least express something that you personally think without being told to think it. I'm getting this mental picture of a bicycle messenger who is mortally wounded because he has to exert himself for a living simply because he could not grasp the concept of "'DING!' - fries are done!!". > wrote in message oups.com... >I don't vote Liberal. Don't you think you are overreacting? > |
#9
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Oil scarcity and high production costs a myth?
Jim Warman wrote:
> OK.... YOU have either a point to make or an agenda...... Perhaps you'd like > to educate us "maroons" and "feebs" as to what either or both of these may > be.... > > You are tiresome in your lack of originality..... you are boorish in your > subject matter.... and there is squat going to happen from you posting here > (I can see your resume now.... you bill yourself as an "activist"..). If you > feel so passionately for your subject matter, I suggest you aim at targets > that make a difference. My plate is much too full and the "natural" > progression of these sorts of things is too far down MY list of priorities > to really care. > > I am ashamed that you consider yourself Canadian..... I pity you in the > blind Ontario adhesion to Liberal corruption and cash harvesting (especially > from the West).... and I understand that you are either a displaced Newfie > or have been cohabitating with them for far too long. > > > I am ashamed you call yourself 'Westerner' or 'Albertan'. You represent the worst element of the west; resentment. Maybe small town hicks like yourself should get out more. And remember asshat, I was fscking born here. I am curious if you actually were. |
#10
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Oil scarcity and high production costs a myth?
Shut up Warman. You do not speak for Westerners. Jim Warman wrote: > Don't you think you are "overquoting"? Tell us all... when is the last time > you expressed an original opinion? When is the last time you were able to > start a thread without doing a cut and paste? > > If you're from Ontario and don't vote Liberal, there is every likelyhood > that you don't vote (for shame, for shame). Alberta is capitol C > conservative.... you have, time and time again, itterated your disdain for > the "oil cartel" (Alberta being the oil "sheikdom" of Canada).... The NDP is > nothing more than a ballot waster and the Bloc Quebequois - what can you say > about a frog??? > > With no pertinent input.... no problem solving abilities... and the innate > ability to provide comic relief that is, strangely, totally bereft of > comedy... you offer nothing save for cut and paste quotes from the news > media... generally the same, self serving sources, time and time, again. > > For solution, I can only offer that you remove your hand from your digit, > either decide that you will wear Old Spice and brush your teeth and find a > lady friend (or break your Dads heart and come out of the closet), putting > an end to your foolishness.... or at least express something that you > personally think without being told to think it. > > I'm getting this mental picture of a bicycle messenger who is mortally > wounded because he has to exert himself for a living simply because he could > not grasp the concept of "'DING!' - fries are done!!". > > > wrote in message > oups.com... > >>I don't vote Liberal. Don't you think you are overreacting? >> > > > |
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