March 16, 2017
OPEC Pushes for Collusion with American OIl
Timothy Birdnow
The Boss Hog of OPEC is trying to get American oil producers to collude with his price-fixing cartel in order to drive up market prices for oil.
From the article:
"OPEC Secretary General, Mohammad Sanusi Barkindo, appears to be pressing his idea for the U.S. producers to join OPEC in cutting production this week at an oil industry conference in Houston. But according to guidelines (see below) issued by the Federal Trade Commission and U.S. Department of Justice (DOJ), "agreements of a type that always or almost always tends to raise price or to reduce output are per se illegal….The Department of Justice prosecutes participants in hard-core cartel agreements criminally." Therefore, I believe his efforts will fail.
In addition to suggesting U.S. producers collude with OPEC, he also has met secretly with oil traders and banks to get feedback on OPEC's market manipulation, denied there was ever a price war, and blamed the current glut on American shale oil producers. His meetings with hedge funds and banks might be helpful to OPEC, and I wonder how OPEC will reciprocate if it gets help."
End excerpt.
So now the Thanksgiving Turkey is trying to recruit the barnyard chickens into joining them on the table. If American oil producers have good sense they will reject this devil's pact. Oh, and it's illegal. In 2008 Donald Trump stated:
"The biggest problem I never hear anybody talk about. I told you about it once. Every time they lower interest rates, the cartel, because I call it a cartel - the illegal monopoly - raises oil prices. So the monopoly, because that's what it is, a total illegal monopoly. If businesses ever formed OPEC, everybody would be put in jail."
Indeed they would.
But constraint of trade is always good where the Democrats are concerned, and I suspect Barack Obama would have encouraged U.S. producers to join so he could drive prices up and push renewables (which is a will-o-the-wisp intended to drive up prices and reduce our "carbon footprint" through economic backsliding and poverty.) Trump is, hopefully, made of better stuff.
Let us reason together; a production cut would mean more money for oil producers and is a tempting thing to shale producers, as it is more expensive to frack than to drill normally. That would mean more profits. However, it would ultimately mean closing viable new fields and the OPEC countries could restart any time they liked. This would mean ultimately that the new American producers would be at the mercy of our barefoot Islamic Caliphs in the oily sands of Arabia and whatnot. The Arabs know this, which is why they are so keen to get us to cut production. It is much more expensive to develop American oil than to just suck it out of the ground Bedouin style.
And ultimately it is geopolitically vital for them to get us out of the game. There would be no rising Islam worldwide were it not for the oil revenues which have allowed them to fund and finance Jihad across the globe. A total collapse of oil prices would be great for consumers but would put the Arab countries back in the Middle Ages from whence they came. It would also destroy what is left of the communist Venezuelan dictatorship, and bankrupt the eeevvvilll Russkies. All of this is to the good from an American perspective - not so good from the perspective of our enemies. Naturally, the internationalists and the Leftist cadre see common cause with the Death to America oil derrick crowd.
Oil is the lynchpin of modern post-industrial civilization, and cheap oil is the key to not just prosperity but the eventual overthrow of despotism worldwide. Most of the world's current despots are oil tycoons, or at least survive because of the idiotic efforts to restrict the flow of energy. Energy is called power for a reason. It isn't just something to power your car or your smart phone; it's what powers the political classes. THAT is why they want to restrict it - and why we MUST make it as cheap and available as possible. Anything designed to contain it is antithetical to our principles of freedom and justice.
Competition in an industry is always good. It is vital in this business. Let's run those drills and push those despotic sheiks and Russian oligarchs back into the slimy holes they climbed out of!
The Boss Hog of OPEC is trying to get American oil producers to collude with his price-fixing cartel in order to drive up market prices for oil.
From the article:
"OPEC Secretary General, Mohammad Sanusi Barkindo, appears to be pressing his idea for the U.S. producers to join OPEC in cutting production this week at an oil industry conference in Houston. But according to guidelines (see below) issued by the Federal Trade Commission and U.S. Department of Justice (DOJ), "agreements of a type that always or almost always tends to raise price or to reduce output are per se illegal….The Department of Justice prosecutes participants in hard-core cartel agreements criminally." Therefore, I believe his efforts will fail.
In addition to suggesting U.S. producers collude with OPEC, he also has met secretly with oil traders and banks to get feedback on OPEC's market manipulation, denied there was ever a price war, and blamed the current glut on American shale oil producers. His meetings with hedge funds and banks might be helpful to OPEC, and I wonder how OPEC will reciprocate if it gets help."
End excerpt.
So now the Thanksgiving Turkey is trying to recruit the barnyard chickens into joining them on the table. If American oil producers have good sense they will reject this devil's pact. Oh, and it's illegal. In 2008 Donald Trump stated:
"The biggest problem I never hear anybody talk about. I told you about it once. Every time they lower interest rates, the cartel, because I call it a cartel - the illegal monopoly - raises oil prices. So the monopoly, because that's what it is, a total illegal monopoly. If businesses ever formed OPEC, everybody would be put in jail."
Indeed they would.
But constraint of trade is always good where the Democrats are concerned, and I suspect Barack Obama would have encouraged U.S. producers to join so he could drive prices up and push renewables (which is a will-o-the-wisp intended to drive up prices and reduce our "carbon footprint" through economic backsliding and poverty.) Trump is, hopefully, made of better stuff.
Let us reason together; a production cut would mean more money for oil producers and is a tempting thing to shale producers, as it is more expensive to frack than to drill normally. That would mean more profits. However, it would ultimately mean closing viable new fields and the OPEC countries could restart any time they liked. This would mean ultimately that the new American producers would be at the mercy of our barefoot Islamic Caliphs in the oily sands of Arabia and whatnot. The Arabs know this, which is why they are so keen to get us to cut production. It is much more expensive to develop American oil than to just suck it out of the ground Bedouin style.
And ultimately it is geopolitically vital for them to get us out of the game. There would be no rising Islam worldwide were it not for the oil revenues which have allowed them to fund and finance Jihad across the globe. A total collapse of oil prices would be great for consumers but would put the Arab countries back in the Middle Ages from whence they came. It would also destroy what is left of the communist Venezuelan dictatorship, and bankrupt the eeevvvilll Russkies. All of this is to the good from an American perspective - not so good from the perspective of our enemies. Naturally, the internationalists and the Leftist cadre see common cause with the Death to America oil derrick crowd.
Oil is the lynchpin of modern post-industrial civilization, and cheap oil is the key to not just prosperity but the eventual overthrow of despotism worldwide. Most of the world's current despots are oil tycoons, or at least survive because of the idiotic efforts to restrict the flow of energy. Energy is called power for a reason. It isn't just something to power your car or your smart phone; it's what powers the political classes. THAT is why they want to restrict it - and why we MUST make it as cheap and available as possible. Anything designed to contain it is antithetical to our principles of freedom and justice.
Competition in an industry is always good. It is vital in this business. Let's run those drills and push those despotic sheiks and Russian oligarchs back into the slimy holes they climbed out of!
Posted by: Timothy Birdnow at
08:19 AM
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