Posted on 05/16/2006 7:29:16 PM PDT by Flavius
Vice President Dick Cheney has been entrusted with a task regarded as vital to bolstering the Bush administration's sagging political popularity: the search for additional crude oil in order to help stabilize U.S. gasoline prices over the next few months.
Mr. Cheney was recently sent to Central Asia and other regions to coax allies to significantly increase supplies to stabilize U.S. gasoline prices for the summer. Administration sources said Mr. Cheney has run into significant difficulties as he has found that many of the potential suppliers have become committed to China.
"We're in a race with China and so far we're losing," an administration source familiar with Mr. Cheney's trip said.
During his visit to Washington in late April, the sources said, Chinese President Hu Jintao brusquely rejected President Bush's appeal to cooperate on energy resources to ensure global market stability. Later, Mr. Hu visited Nigeria, which supplies about 17 percent of U.S. oil imports.
The sources said Mr. Cheney, who has long-time contacts in the industry, has been designated to find oil supplies both for the short- and medium-term.
They said Mr. Cheney's visit to Central Asia was based on the assessment of the U.S. intelligence community that Middle East oil supplies will become increasingly precarious after 2008.
The administration has determined that gasoline prices will become a major issue in congressional elections in November. A May poll taken by AP and Ipsos reported that 23 percent of respondents approve of the president's handling of gasoline prices, the lowest rate in the survey.
The sources said Mr. Cheney found his hosts in Central Asia to be distrustful of U.S. intentions, with some Muslim countries fearful of a regime change as that which took place in 2005 in Kyrgyzstan, regarded as the most pro-American country in the region.
Mr. Cheney also was informed of the contracts China has already signed with Central Asian republics. In April, Turkmenistan signed a deal to supply China with 30 billion cubic meters of gas per year from 2009 to 2039. The price has not yet been determined.
"Even if many analysts doubt Turkmenistan's ability to meet this contract, that deal evokes the contradictions inherent in China's transitional phase," the Washington-based Jamestown Foundation said in a report. "In its substance it evokes the old approach: China subsidizing dictators by paying for pipelines as well as for gas and trying to knock prices down while tying up the producer for 30 years."
A key target of Mr. Cheney's visit was Kazakhstan, regarded as the richest oil and natural gas state in the region. The vice president, in contrast to the other countries he visited, did not discuss the need for democracy in Kazakhstan, whom he described as a "key strategic partner of the United States."
"Obviously Kazakhstan is important given their considerable resources," Mr. Cheney said on May 5 on his return to Washington. "It's one of the few places where we're going to see an increase in oil production from a non-OPEC state over the next few years."
The sources said Mr. Cheney sought to exploit a rift between Russia and states in Central Asia. The vice president was highly critical of Moscow's use of energy, particularly transport rights, to intimidate its neighbors.
At the same time, the Bush administration has been pressuring Kazakhstan to export oil through the Baku-Tbilisi-Ceyhan pipeline that would bypass Russia and supply Europe and the United States. The sources said the Kazakh agreement to join the trans-Caspian project could be signed in June.
Congress has been growing increasingly concerned over soaring gasoline prices. On May 9, members of the Senate Commerce Committee accused the administration of failing to employ technology designed to increase automobile fuel economy.
"The president and I are committed to improving fuel economy across the board through an open regulatory process built upon sound science and economics, but we will not accept an arbitrary statutory increase under the current passenger cars system," Transportation Secretary Norman Mineta told the committee.
there are no shortages, there are no supply problems, the rising price has not resulted in lower demand (at best, its flattened growth).
take out the speculative bubble - that's $15/bbl right there.
The Chinese recently signed a big oil deal with Nigeria.
The BBC (to its credit) reported that it was understood that China,unlike western governments/companies,wouldn't ask any of those pesky questions about corruption or human rights.
if anything, chicoms would complain to their new host country, that they are way to lenient towards their own subjects
The premise underlying this article is bunk, regardless of the accuracy (or not) of the facts presented. It really doesn't matter if those countries sell to China or to us: if they sell to China, that's less oil China will buy elsewhere, and more for us elsewhere. It's a truly global market. Besides, Vice President Cheney is not a major customer - the US government only buys a rather insignificant amount of oil (for the strategic reserves); the rest is sold to oil distribution companies.
keep forgeting the fungible
We need look no further for oil than the Gulf coast of Florida and ANWR. The lost dog is under the house barking.
Asleep at the wheel in the drive to energy independence.
Half-hearted at best......pitiful lackluster administration......
There is big potential with Libya, now that we are bestest buddies with them. Their infrastructure needs to be rebuilt after years of embargo declines, but they could make a big difference.
Could it be that a nation with no manufacturing base has no capital with which to negotiate?
yeah but our starbucks has 20 flavors
I agree....but I'm sure they will blow the deal.......
Something has gone wrong......terribly wrong with this administration.
Perhaps it's as simple as having a stumblebum for a president.
His limited vocabulary has bored most people.
Several years ago I looked forward to his speeches......now I cringe.....waiting for Johnny one note........
he would have made a great 1-termer.
Too bad the alternative was worse.
If China continues to grow and starts to use energy and resources, will there still be more oil for us elsewhere?
I need to wake up. The answer to my question is obvious.
Yep. The price may go up - increasing demand will do that - but it's not just the Chinese that affect it, and it doesn't matter who they buy it from. We do compete with them for oil, but it's not a political competition, it's an economic one, and the winner is quite simply the high bidder.
Solid research. Usually well-attributed. The promotional piece you have linked to doesn't seem to cite its author however. Probably didn't get proofed enough in order to meet deadline.
But it is definitely legit.
China also bought up EnCanna's bloc of Occidental's holdings in Equador before Equador decided to kick Occidental out.
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