Links
Oil Production and Tanker Rates
The preceding article is oddly comforting. Its highly unlikely that the system supporting the oil supply/demand dynamic will change radically in the near term because the regimes of the OPEC 10 all rely on the stability of the income to maintain their regimes. Yes the dynamic of increased Russian production and the political turmoil we now face does impact the equation, but the fact that most of the region; while a portion of the populace resents the cultural implications of such and is on this tyrannical tact today; is better off maintaining this economic relationship with the West, not going to war over it.
The target range for the OPEC basket, now about $22-27/bbl, has little or nothing to do with optimizing profit and a lot to do with poli-economic survival. If the price drops too low, services for the populace of the producer states suffer and coups become a distinct possibility; too high and the consumer nations will activate their idle wells, of which there are plenty, then seek alternative sources and finally work even harder on alternative fuels.
The Politics of OPEC pricing in the Middle East
By Professor Dr. Morris Mottale – Franklin College, Switzerland
The American intervention in Afghanistan and the intensification of the Israeli-Palestinian War ever since the 9/11 attack against the United States brought another cycle of anxiety about reliable and steady oil supplies. Some oil producing countries such as Iraq and Iran floated the idea of curtailing oil production to punish the United States for its support of Israel. Meanwhile, in the month of April of 2002, political turmoil and a failed coup d’etat in Venezuela left analysts in consuming countries and oil consumers puzzled about the direction of that country, a leading oil producer and one of the founders of OPEC. In the same month, Saudi leaders visiting President Bush assured the U.S. no oil boycott was forthcoming to buttress the Arab cause against Israel. After all, Saudi Arabia and the United States are, ostensibly, allies.
To judge from the president’s statements it seemed everybody in the world was going to be grateful for the magnanimous Saudi disposition toward America and the West. Continue Reading
The Official Guide To Marine Finance Providers
Shipping Index
