Wednesday, August 31, 2005

Oil Politics and America's Eventual World Domination

Lecture on World Oil Production Decline and America’s Brilliant Tactic to Secure These Petroleum Reserves Through Diplomacy and Warfare.

A secret meeting between America’s energy company executives and Vice President Dick Cheney has been the stuff of speculation and sinister conspiracy theorists in the press. If any of these poorly educated press writers ever passed a physics, geology, or resource economics class, they’d already know what was discussed in these secret meetings, and why.

I remember a term from 2 of my professors. Both my physics professor Dr. Price and my anthropology professor Dr. Tarrant coined a term from the field of resource economics called “Peak Oil.”

This theory of peak production has exhibited itself frequently over the past few centuries. We saw how Britain’s coal mining first exceeded, then met their industrial needs, eventually declining and falling away. This same production curve was proven with their own domestic oil production. The extraction yields always follow a bell curve with domestic demand always increasing and exceeding it’s proven resources.

This bell yield curve above applies to all scarce resources, including oil.

As you can see, our proven reserve has declined since peaking in 50’s and 60’s indicating a notable decline in world oil production, yet we see an ever increasing demand for oil far exceeding all known reserves.

The most drastic increase in world demand started when America outsourced its industrial base to China in order to capture savings on part of the business equation; labor and capital. Labor costs in Asia have provided us consumer savings at any of your local Wal-Marts, but also have predictably lowered our own wages.

China is now the new big dog on the industrial block.

As our world oil reserves taper off and our world oil demand steadily increases we will meet a point in our graph where demand will outpace supply.

In late 1999, Dick Cheney stated:

“By some estimates, there will be an average of two-percent annual growth in global oil demand over the years ahead, along with, conservatively, a three-percent natural decline in production from existing reserves. That means by 2010 we will need on the order of an additional 50 million barrels a day.”

A report commissioned by Cheney and released in April 2001 was no less disturbing:

“The most significant difference between now and a decade ago is the extraordinarily rapid erosion of spare capacities at critical segments of energy chains. Today, shortfalls appear to be endemic. Among the most extraordinary of these losses of spare capacity is in the oil arena.”

If oil demand outpaces oil production by a mere 5%, you’ll see oil prices increase by 400%.

This is proven in recent history. Since the year 2000, oil demand exceeded oil production by only 2.5% and we all have witnessed market oil prices increase by 200%. When oil is $25 per barrel, you get gasoline prices around $1.25 gallon. When oil hit $50 per barrel you paid $2.50 per gallon.

Resource economics isn’t an impossible science to comprehend. Just watch the markets and compare it to human behavior.

We’ll never see $50 barrel oil ever again.

The era of cheap oil is passing. Our economy is based and developed on the theory of cheap oil and the US government has been aware of Peak Oil since at least 1977 and has been actively planning for this crisis for over 30 years.

Three decades of careful, plotting analysis has yielded a comprehensive, sophisticated, and multi-faceted plan in which military force will be used to secure and control the globe's energy resources. This plan is simplistically, but not altogether inaccurately - known as "Go to War to Get Oil."

This strategy was publicly announced in April 2001, when a report commissioned by Dick Cheney was released. According to the report, entitled Strategic Energy Policy Challenges For The 21st Century, the US is facing the biggest energy crisis in history and that the crisis requires "a reassessment of the role of energy in American foreign policy."

That's a diplomatic way of saying we are going to be fighting oil wars for a very long time.

James Woolsey, the former Director of the CIA, practically admitted as much at a recent conference on renewable energy:

“I fear we're going to be at war for decades, not years . . . Ultimately we will win it, but one major component of that war is oil.”

The war in Iraq, which has been 23 years in the making, is just the beginning of a worldwide war that "will not end in our lifetime." The reason our leaders from both parties politic are telling us the "war on terror will last 50 years" and that the US engagement in the Middle East is now a "generational commitment" is two-fold:

1. All the countries accused of harboring terrorists - Iraq, Iran, Syria, West Africa, and Saudi Arabia - also happen to harbor large oil reserves.

2. Within 40-50 years, even these countries will see their oil reserves almost entirely depleted. At that point, the "war on terror" will come to an end.

While the Middle East countries find themselves targets in the "war on terror", China, Russia, and Latin America find themselves targets in the recently declared and much more expansive "war on tyranny."

Whereas the "war on terror" is really a war for control of the world's oil reserves, this newly declared "war on tyranny" is really a war for control of the world's oil distribution and transportation chokepoints.

China and Russia have taken notice of these declarations and seem to be making preparations to defend themselves. Both China and Russia firmly believe we ‘stole’ Iraq’s oil potential out from underneath them. Hence the controversy over America cloaking our acquisition of cheap oil, veiled in our war on terror, followed with our war on tyranny.

China has also strengthened its ties to oil-rich Venezuela while engaging in an undeclared oil-war with long time rival and US ally Japan. China and Russia have already started colonizing the Sudan in a covert attempt to steal oil reserves we’ve already dubbed as ours.

This type of large-scale, long-term warfare will likely require a massive expansion of the military draft. It's probably not a coincidence that the director of the Selective Service recently gave a presentation to Congress in which he recommended the military draft be extended to both genders, ages 18-35.

The strategy - as distasteful as it may be - is characterized by a Machiavellian logic. Given the thermodynamic deficiencies of the alternatives to oil, the complexity of a large scale switch to these new sources of energy, and the wrenching economic and social effects of a declining energy supply, you can see why our leaders view force as the only viable way to deal with the coming crisis.

Of course, the US is not the only nation that needs affordable oil. Not by a long shot. France, Germany, Russia, and China all need it also. While these countries may not be able or willing to directly confront the US on the battlefield, they are more than willing to attack the US financially. The US may have the world's most deadly cluster bombs, but the EU has the world's most valuable currency, and intends to wield it as a strategic economic weapon to offset US firepower.

Ain’t no secrets in our government, just economic concepts beyond the grasp of our electorate constituencies.

Or put more simply, “the strength of a government lies directly in the ignorance of its voters.”

We all love big cars and trucks with V-8 motors, and our Presidents know this. I expect he and his cabinet will do a fine job keeping us Americans fat and happy with our huge cunts behind the wheel, and our numb skulls buried in Saudi sand.

It costs us $10 to pull a barrel out of Alaska. It only costs $1.00 to pull a barrel out of Iraq, and Iran etc.

The age of cheap oil is over, unless we get our hands on the proven reserves throughout the Middle East and Central Asia.

We ain’t fighting terrorists or tyrannical Muslim dictatorships. Our government is doing its job exceptionally well and acquiring the resources needed to continue living far beyond the living standards of the remaining 6 billion hungry people on this planet.

It’s either the US or China. Chinks don’t deserve to run the world.

We’re Americans, we’re worth it.


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