Monday, July 7, 2014
The Mystery of OPEC
The Mystery of OPEC: My Glut Feeling About It Lex Loeb Contributor Network . The Biggest Mystery of OPEC is why it still exists if the popular assumptions at the moment are correct that we do have "Peak Oil" and a world wide demand surge that can never be met with reserve resources. With Oil way over $100 a barrel , as it once was around a dollar a barrel in the 1950s, the raison d'etre for OPEC has to be called into question? My glut feeling is that OPEC still exists because they are fearful of exposing real glut conditions. The Saudis recently refused to have outsiders come in and re- appraise their in place oil reserves. Most observers think they are hiding peak oil declines in reserves. Considering they still belong to OPEC, other than just bluffing, I think there are real underlying glut conditions. The Saudis have more than hinted that there is no lack of supply at the moment and that the problem with the US market is that the US congress has barred oil field development in the most likely places the US can tap its own oil and the US congress has decided it wants to help the USA commit economic suicide for the environmental religion of America. US refineries cannot meet US demand and big international oil interest are having to build the new refineries off shore as a result . The only reason OPEC still exists is that glut conditions are underlying the escalating prices.. It is a shame that the American Citizens elect politicians who want to help the country commit economic suicide. I guess we can put it down to a failing of democracy once our economy is owned by foreign oil producers. There is also some economic nonsense in saying that. In a free trade world it is perhaps better for the USA to import a lot of cheaper foreign oil than producing our own more inefficiently. Capital inflows from foreign oil importers "buying" the US economy only recycles petro dollars to American's advantage. Selling the US market short with the dollar already down is worst form of economic suicide when foreigners still want us assets. Where is our OPEC equivalent to save us from our glut of financial derivatives? There are easy ways to make the real underlying glut in oil visible and even see ten dollar a barrel oil again. The first is to react to higher prices and use less. That is not conservation it is economic good sense. The second is to let our oil companies and foreign oil companies have access to promising oil filed areas in US controlled territories. The third is to vote out of congress any environmental kook you see running for office and definitely not to have one in the oval office. I am a believer in alternative energy resources but the reality is there are few resources left after the environmental kooks tie up all of the American landscape in designated areas that can never be touched. There is unlimited geothermal power around mt Saint Helen's in Washington state. The government spent over 2 billion dollars making it a stupid national park when it could have sunk two billion dollars of underground shafts there to allow water to flow by gravity from snow melt into Geo thermal wells to produce possibly enough energy to power the entire north west. It would not hurt the environment any more than the super highway the idiots in congress built to nowhere up a volcanic blast zone. Meanwhile millions of dead trees from 1981 are still rotting on the ground there instead of being salvaged.. Other trees else where had to be cut to meet market demand because of our idiot congress! They saved the environment. HA! Now we get to see windmill everywhere we look and they kill more birds every year than George bush the firsts wet land laws save! In California land that used to be open to grazing by sheep and goats is now just allowed to burn because there the same big environmental kooks saved the environment. They actually believe they saved it and that letting it burn as opposed to be grazed is more natural. We are in idiotic times. This new environmental religion is doing more harm to the earth than good in the long run. OPEC exists to help make the environmental religion stronger I guess? The mystery of OPEC is that it still exists . That gives me that good old glut feeling. .