Quote of Terri Swearingen, a nurse from Ohio
Why low oil prices and what is the future?
Commentary by S. Tom Bond, Retired Chemistry Professor and Resident Farmer, Lewis County, WV
The only reason why anyone with an abundant supply of a commodity which concurrently is their primary source of income would keep the price down is to remove or damage a future competitor. The Saudi’s certainly don’t need every last cent they could squeeze out, they could live on less comfortably. Look up the Saudi family life style!
So who is the future competition? An American conceit is that it is the shale industry they are after. We have been told how much gas and oil is available in the United States, but if you read my last article you know that doesn’t hold up. We are “sucking up a smaller cup of ‘soda’ through a larger straw,” so to speak.
We are also told “they want to hold onto a larger market share,” but they have the reserves, and the value is bound to go up unless oil is replaced by some other versatile source of energy. (One of the values of oil is that it can be used for transportation because almost all engines run on some oil product. Some gas is used, but liquid fuel is much more easily handled. There is a lot of work being done toward electricity storage, but so far, not too much success. It will be a long time before electricity storage is as simple and cheap as liquid fuel storage.) Other stationary sources of energy are moving, getting started, but are not a significant part of the energy supply at this time. More about that below. So, market share, maybe. Maybe no.
Then there is the geopolitical theory. Russia and Iran are the US’s “enemy du jour.” Both have huge supplies of oil that are not controlled by the big corporations of the West. They are competitors of these corporations on a day to day basis. In Iran, there was a revolution and the hereditary Shah fled the country. It is a cloudy story, but the West lost political control. Iran sells substantial amounts to China and India, though U.S. allies such as Japan, Italy and France are still the major buyers. That’s competition, and the objective of modern corporations is to eliminate competition, or at least to get a cut of the profit.
Russia has a long history of running over its neighbors. As the U. S. S. R. it had built up the largest contiguous land mass under the same political influence on earth, 8.6 million square miles. It is still the largest country on earth, 6.6 million. It is 1.75 times the size of the US. But it’s population is one tenth of China’s and half the United States’. The large land area is related to its wealth of natural resources.
Since the fall of the U. S. S. R. Western corporations have played a role in development of Russia’s resources, but do not have control, usually being forced to work with Russian firms. US missiles are being put in place in the former U. S. S. R. eastern nations in Europe, putting Russia in the position of the U. S. at the time of the Cuban missile crisis. The missiles are within easy range of Moscow. Sanctions have been imposed for annexing Crimea, Russia’s only access to the Mediterranean. Crimea is Russian speaking, and has been part of Russia for 300 years. It was transferred from the Russia part to the Ukraine part of the U. S. S. R. by the Supreme Soviet in 1954.
Cutting the price of oil adds to the sanctions. If the U. S. has any responsibility for the fall of oil prices, it is certainly an economic form of war. If you don’t do anything else as a result of reading this article, read this Russia Under Attack: Letter from CEO of Genoil to CEO of JPMorgan Chase on US Foreign Policy Blowback. It’s quite alarming.
A fourth idea is expressed here. The author claims the high price of oil is forcing the development of alternative forms of energy, such things as solar, wind and tidal power. He claims the Saudi’s are afraid of the development of alternate energy, and that is what they want to stop. It is true that some of the big corporations are putting money in alternative energy. All these can do at present is reduce loads on conventional power sources when the energy source is available, however. The wind needs to be blowing for windmills, the sun shining for photovoltaic or solar thermal. And these alternative energy forms are not helpful for transportation or fighting machines, which are a huge use of petroleum. So, as a Saudi objective, that is doubtful in this author’s opinion.
A fifth idea is also expressed in the last article referenced above. It is that that OPEC will loose its “relevance” (read – ability to control prices) if it doesn’t reform to include all major oil producers. Unsaid in the article, that would include Russia and Iran! Not good for the West! In a decade or so when fracking “comes out of the little end of the horn” (of Plenty) it would be a powerful fraternity indeed!
That seems to be the alternatives. They are not mutually exclusive, of course. Several may be considerations. The U. S. can meet only a portion of its present demand, and that for a short time. Canada’s reserves will help, but the damage to the earth’s resources, and the effect on internal politics work against fracking. Mexico is failing as a source of petroleum. Venezuela is a strong exporter with reserves, but is not dependable.
We live in interesting times. By all means read the article emphasized above. The “Letter from CEO of Genoil to CEO of JPMorgan Chase on US Foreign Policy Blowback” of the title is the third inset and grayed background in the piece. Read it by all means.
SOURCE OF QUOTE ABOVE: Terri Swearingen is a nurse from the state of Ohio. She was awarded the Goldman Environmental Prize in 1997, for organizing the protests against Waste Technologies Industries‘ toxic waste incinerator in the Appalachian town of East Liverpool, on the Ohio River. Swearingen’s efforts influenced stricter nationwide limits for heavy metals and dioxin emissions from waste incinerators.
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