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Energy producers - May 18

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Who Is Stealing Iraq's Oil?

Robert Baer, TIME Magazine
It took quite a while, but it appears that the Bush Administration has finally gotten around to acknowledging that Iraq has an oil problem. The Government Accountability Office is about to release a report that estimates 100,000 to 300,000 barrels of oil goes missing every month. According to the New York Times, the GAO will not offer a conclusion about what specifically is happening to the missing oil, other than it is probably lost to corruption, smuggling or just bad accounting.

Iraqis oil traders, on the other hand, tell me they think they know exactly where the stolen oil is going - the militias appropriate it to arm and feed the rank and file. The same traders also tell me there's a lot more pilfered oil than the GAO acknowledges, and that the practice started as soon as Saddam fell.

...In the run-up to the Iraq invasion, then Deputy Defense Secretary Paul Wolfowitz assured Congress that Iraqi oil would pay for the country's occupation and reconstruction. If my Iraqi oil traders are right, it's one more thing we need to add to the long list Wolfowitz and his neo-con friends in the Administration got wrong: oil is helping pay for Iraq' s destruction.

Robert Baer, a former CIA field officer assigned to the Middle East and Time.com's intelligence columnist, is the author of "See No Evil" and, most recently, the novel "Blow the House Down."
(17 May 2007)
Baer's book, "See No Evil" inspired the movie "Syriana." (NPR)


Saboteurs have upper hand in an endless war, says Iraq's Oil Minister

Patrick Cockburn, The Independent
Iraq's Oil Minister has unequalled experience of adversity. As a leading Iraqi nuclear scientist, Dr Hussain al-Shahristani was summoned to see Saddam Hussein in 1979 and asked to assist in a project to make a nuclear weapon.

He flatly refused to help and was immediately thrown into jail and savagely tortured by being beaten for 22 days as he was hung in the air by his wrists that were tied behind his back. Adamant in his determination not to assist Saddam in developing a nuclear device Dr Shahristani spent 10 years in solitary confinement in a small windowless cell in Abu Ghraib prison.

...Sitting in his office in the Oil Ministry on a surprisingly rainy day in Baghdad, Dr Shahristani carries few outward signs of a life beset by danger and suffering. Following the overthrow of Saddam in 2003 he returned to Iraq and became the leader of the independent members of parliament who belonged to the Shia alliance. He became Oil Minister a year ago.

It is not an easy job. Iraq's only revenue is from the 1.6 million barrels a day of crude oil that the country exports out of the 2.2 million barrels a day it produces. Every day saboteurs blow up Iraqi oil pipelines and Oil Ministry teams try to repair them in an endless war to strangle Iraq's oil exports to the Mediterranean. Right now the saboteurs have, perhaps temporarily, the upper hand.

"It is as bad as it has ever been," says Dr Shahristani in an interview with The Independent. "If we can protect the pipeline we can add half a million barrels to our exports immediately."

The main problem is that the pipeline that takes crude oil from the oilfields in northern Iraq runs through notoriously dangerous territory between Kirkuk and Baiji to the west.
(18 May 2007)


Smart card - Ahmadinejad's answer to petrol consumption

IANS via Malaysia Sun
Although Iran has a daily oil production of 4.2 million barrels, it still spends five to eight billion dollars for petrol imports.

Of the petrol consumption of some 73 million litres daily, over 40 percent is imported - but at the pump, Iranians have to pay only 11 cents per litre, or only about one-fourth of the actual cost.

The lavish subsidies for keeping petrol prices low and people's spirits high have not only caused a huge hole in Iran's budget but have also increased the number cars in Iran.

Numerous related problems, including traffic jams and pollution in big cities and petrol smuggling into neighbouring countries are other the impacts of petrol subsidies.

Since 2004 the Iranian administration has tried to confront this problem but all plans were dropped in order to avoid angering the people and not to add to inflation, which is already at a critical level of 20 percent.

Now, President Mahmoud Ahmadinejad and his administration aims to put end to the dilemma by rationing petrol with the so-called 'smart card' initiative scheduled to begin on May 21.

The plan of reducing lavish consumption of petrol is basically supported by most Iranians, but Ahmadinejad seems to have gotten cold feet about the plan's social and economic consequences.
(18 May 2007)


"Untapped: The Scramble for Africa's Oil"
(transcript and audio)
Juan Gonzales and Amy Goodman, Democracy Now
Historian and Journalist John Ghazvinian discusses his recent trip to Nigeria and the African oil boom. The U.S. now imports more oil from African nations than from Saudi Arabia. We begin today's broadcast with a look at Africa and oil. It's a little known fact: the United States today imports more oil from Africa than from Saudi Arabia. More than $50 billion in foreign investment in African oil is expected over the next three years.

What has this oil boom meant for Africa's ordinary citizens? Our first guest spent a year reporting across the continent to find out. John Ghazvinian is a journalist who has written for publications including Newsweek, The Nation and Time Out New York. His new book is called "Untapped: The Scramble for Africa's Oil." The book compares the global competition for the continent's oil resources to the nineteenth century scramble for colonization.

John Ghazvinian has just returned from Nigeria, where oil has been the driving force behind a longstanding bloodshed. Protesters in Ogoniland have just ended their week-long occupation of a major oil pipeline hub that forced Royal Dutch Shell to cut their daily production by nearly 40%. In recent weeks, villagers demanding compensation and regional control over Nigerian oil have kidnapped at least 13 foreign workers, occupied a Chevron oilfield, and bombed other international oil pipelines. Two major US companies, Chevron and Hercules Offshore, are evacuating all their non-essential workers from the oil-rich country.
(17 May 2007)

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