Posted on 01/28/2011 9:00:43 PM PST by unseen1
Via Eric Bolling of Fox News:
The Suez Canal and the Suez Canal pipeline transport about 4.5 million barrels of oil per day between the two, so when oil investors/traders see protesters on tanks in the Suez, it creates panic because they’re concerned about the delicate balance between supply and demand on the world’s oil.Any disruption in oil supply spikes prices, and these events are certainly cause for disruption.
Also very important is the geographic location — just across the canal is Saudi Arabia — the world’s largest producer of oil. If this unrest spills over into Saudi Arabia, prices could double to $200/barrel!
The effect on the U.S. economy would be disastrous and hamper the economic recovery.
I am not as pessimistic as Bolling (yet), but the situation in the Middle East is explosive, and the potential is certainly there for economic disaster. If the Mubarak regime is overthrown and replaced by a fundamentalist group like the Muslim Brotherhood, anything is possible up to and including a shutdown of the Suez Canal. If, as Bolling suggests, this unrest spreads into Saudi Arabia, all bets are off. There are already reports that the unrest in Egypt is spreading to Jordan and beyond. Some worry that the instability could spread further to other OPEC countries such as Libya and Algeria. And, if we throw a newly nuclear-armed Iran into the mix, Bolling’s prediction of $200 oil may be on the low side.
None of this is good news for the fledgling economic recovery struggling to gain steam in the U.S. If oil prices rise to even $125 and stay there, a double dip recession becomes more likely than not, and anything north of $150 virtually guarantees it. Meanwhile, our clueless president keeps his suicidal drilling ban in place while he dreamily muses about solar shingles and windmills. Fantasy is no substitute for an actual energy policy, yet that is all this administration offers.
What, precisely, is it going to take for the Obama Administration to wake up from their ideology-induced stupor and realize that we need to drill here and drill now? We need to be developing all of our domestic energy supplies (e.g. natural gas, oil, nuclear, coal, etc. ) with all deliberate haste. Is Team Obama so afraid to admit that Governor Palin is right about this (and has been right all along) that they’re willing to risk economic disaster? It certainly appears that way. And make no mistake, if we see sustained oil prices of $200 or higher, the recession from which we just emerged will seem like a walk in the park.
The only reason for optimism is that the 2012 election is only 21 months away. If, as appears increasingly likely, the Obama Administration does nothing in four years to develop a realistic energy policy, the voters will know who’s to blame. Indeed the only energy policy coming from this administration that I can discern is to do everything possible to prevent the development of those domestic energy resources that, you know, actually work. Presumably this is the approach Obama believes will help us “Win The Future”. In 2012 voters will have the opportunity to take a different approach.
Awww c'mon......everybody knows that the sun revolves around Obama. The science is settled.
$300 sounds possible. Oil prices will zoom. And Ohbummer won’t allow us to build more nuclear power plants
you hit the nail on the head, however note that even in Saudi Arabia there is a lot of discontent — the Shias, Ismailis, Boras etc. are discriminated against heavily, their holy shrines have been bulldozed. And amongst the Sunnis, there are a lot of poor, because the wealth of that kingdom is treated as the personal wealth of the Saudi royal family (3000 princes and counting). Furthermore, the various arab tribes regard the house of SAud as usurpers from the Nejd region who went on to conquer Hejaz and the rest of the Arabian plateau. Civil unrest is highly likely — in fact it was happening until the British idiot, Lawrence of Arabia helped out before WWI
Correct — what shocks me about Saudi Arabia is that there are still SAUDI nationals who are beggars. And they had a budget deficit a few years ago as the SAud family splurges on luxuries for themselves.
the UAE. Yes, but that’s a bubble. The moment it bursts (and it will), the Emirates will return to being pearl fishermen.
/johnny
200 dollar oil....ever the fear card
will momentarily kill our economy as bad as 20% interest would
i will have a hard time surviving it
(chain of car washes)
I probably should have remebered there is still religious tension, I mean, a Mid East or Islamic nation without religious tension is like Never Never Land. And of course there ar emany very angry discontent people in Saudi Arabia, in Mid East nations there are always people who want to taje down and kill the current leaders and force themsevles into power. That is why there were turmoils and assasinations in Saudi Arabia, which I am aware of. In nations that rife with warring religions, sects of Islam, tribes, clans and families, discontent and murders and riots and rebellions and assinations are inevitable byproducts.
But having oil reserves vs not having oil reserves will still make huge differences I think. What makes it worse for people in oilless arab nations like Egypt or Jordan is the fact that America and a lot of other nations give the regimes support that is often seen as pointless. Although it is inane and dangerous and senseless that we do business with Saudis for our oil, in some ways our support of Egyptian and Jordanian regimes is actually far more shameful. Often the only thing we get in return for that is pledges to fight terorrism that originated in their nations, and they only follow said pledges when an actual terror attack does happen, like the 9-11 where numerous hijackers were fo course Egyptian. Often, the support we give Egypt and Jordan is completely unconditional, which magnifies the fury of the people. We often have to because the only other options are worse ones (Muslim Brotherhood) but the way we do it causes magnified tension as well.
“wax on, wax off” ; ~ )
There is no way in hell the Egyptian military could defend the Suez. It’s at sea level, in the middle of a desert and has no locks.
Yep. A lot of the die-hards are up here now, drilling the Bakken/Three Forks. For some reason they don't like our weather...
$300 oil is not possible.
Ain't no way the old Cajun could hang in at the 0 or less temps.
Maybe 30 years ago, but I wouldn't have been happy :^)
It hasn't been that cold this year, but we have had a lot of snow, (a lot like the early '80s) and plenty of wind to play with it.
I've driven more in white-out conditions going to and from the rig this year than ever (and I hate doing that.)
G.W. Bush was President, the Suez Canal would be occupied and controlled by NATO troops. With Obama, the Muslim Brotherhood could bar all Western-bound ships and he would do nothing.
$300 and Obama would be impeached and removed from office, and President Boehner would send troops to secure the Suez and anywhere else with uppity Arabs.
The coldest I've ever been in was 5F and about a 20mph north wind, that was more than enough.
Many moons ago my company flew a buddy I worked with to Prudhoe Bay to run an experimental logging tool. The poor coon-ass had frostbite on his nose 15 minutes after stepping off the transport plane, lesson learned there about the north country and coon-asses.
Consider that someone like Soros would have had wind of what the regime has in mind for Egypt over the last two years. That’s plenty of time for him to stock up on gold and Brazilian oil ventures.
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