The strength of the Arab position is diluted by new oil
The strength of the Arab position is diluted by new oil
Ultimately, the only way to erode the Arab position is to remove its base: oil. The long-term solution is finding an alternative to oil, but, as John Maynard Keynes observed, "in the long term we're all dead". Enter the short term solution: new sources and a new delivery mechanism. And this is precisely what we should be celebrating today, as AP reports:
Caspian Sea Pipeline to Be Unveiled
Presidents and oil company executives will inaugurate a 1,100-mile pipeline Wednesday that will carry millions of gallons of crude from the landlocked Caspian to the Mediterranean - a much-needed alternative to Mideast energy resources.
Analysts say the $3.2 billion, U.S.-backed Baku-Ceyhan pipeline could also help bring stability to the troubled region. The Caspian is thought to contain the world's third-largest oil and gas reserves...
Until now, Caspian states sent almost all their oil through Russian pipelines to reach world markets. The new route will neutralize any Russian attempts to use economic levers to bring former Soviet republics back under its wing, Guluzade said.
The pipeline "will carry a huge volume of oil, and Russia is nervous that it is being deprived of big money and also the possibility to dictate its terms to these states," he said.
Posted by Joseph Alexander Norland at May 25, 2005 08:02 AM
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BobW
said:
Actually, there are 2 additional ways to erode the Arab position; breaking the OPEC pricing mechanism and construction of nuclear power plants.
France currently obtains 80% of its electricity from nuclear power plants. PR China plans to build an additional 24 nuclear power plants by 2020.
Caspian oil will assist in breaking the Arab strangle hold but this oil will still have costs in line with US controlled OPEC pricing. I'm sure British North Sea Brent oil will continue its pricing in tandem with the rest. After all, both American and British companies benefit from OPEC rigged pricing.
The Baku, Azerbajdzan - Ceyhan,Turkey pipeline bypasses Russia but adds an additional cost because of this route.
Again, even with the Arabs losing control of the OPEC pricing mechanism, this might not translate to open market pricing for the goo. Others, too, enjoy the el gelt o from the cartel arrangement.
Kol tuv,
BobW
Posted by: BobW on May 25, 2005 03:51 AM
The strength of the Arab position is diluted by new oil
Ultimately, the only way to erode the Arab position is to remove its base: oil. The long-term solution is finding an alternative to oil, but, as John Maynard Keynes observed, "in the long term we're all dead". Enter the short term solution: new sources and a new delivery mechanism. And this is precisely what we should be celebrating today, as AP reports:
Posted by Joseph Alexander Norland at May 25, 2005 08:02 AM