Thursday, June 12, 2014

OIL, RUSSIA AND UNINTENDED CONSEQUENCES...(ORIGINALLY PUBLISHED 3/28/14)

Its been said by some psychologists that opposites attract.  Its been said by others that common interests attract.

Is it possible that what we are seeing in international relations is a "tipping point"?

Those countries that have oil will be entering into an era of diminishing common interests with the oil consuming nations.  In its place will begin a second OPEC, more concerned about maintaining the price of a barrel of oil than their fear of having their governments replaced by radical elements within their own societies.  Russia, Iran, Saudi Arabia, Iraq, Kuwait, Venezuela, Brazil, etc. will strengthen their connections and alliances.

The message that will be sent is that you will not force the price of oil substantially lower by rhetoric of climate change and the need for alternative energies.

This will incrementally increase the reliance on oil suppliers.  We are in no position to have the revenues of oil supplying nations substantially reduced by policies of reducing oil consumption.

Too much tax revenue is collected from oil consumption, too many people feed their families due to oil production and the simplistic appeasement of Russia will reduce the loyalty of several significant producers towards the United States.

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