Click on the headline (link) for the full text.
Many more articles are available through the Energy Bulletin homepage
The ‘oil weapon’ is unleashed against Iran
Gary Dorsch, Seeking Alpha
Crude oil has become a key weapon in the battle between Saudi Arabia, Kuwait, and the UAE, aligned with the United States, against the mullahs of Iran. The Arab Oil kingdoms fear the emergence of a Tehran-led axis linking Iran, Iraqi Shiites, Syria, Lebanon’s Hezbollah, Palestinian Hamas in Gaza, and Islamic militants linked to al Qaeda trying to topple the Saudi royal family.
Earlier this month, Riyadh fired the first shot in the war against Iran, by knocking the price of crude oil to as low as $50 per barrel. The goal is to squeeze Iran’s budget and wreck havoc on its economy, as much as possible, before the mullahs can get their hands on the nuclear bomb. According to a Jan 24th report in the UK Telegraph that indicated North Korea is helping Iran to prepare an underground nuclear test similar to the one Pyongyang carried out last year. ..
(13 Feb 2007)
Contributor DK is puzzled:
1. Since you only need 2.2 Kg of 95% Uranium-235 to have a nuclear bomb, but you need 160 tonnes of 3.6% U-235 to fuel up a 1 GW reactor, the 3,000 centrifuges are far, far more than you would use to make a bomb. That’s why 3,000 centrifuges strongly indicates it is to make fuel.
2. Separately, Saudi Arabia has a booming population and growing appetite for oil-based luxury just as much as Iran. So how can Saudi harm Iran more than it hurts itself by driving down the price of oil ?
3. The story about Kuwait hurting Iraq in 1989-90 by over-producing is not supported by the US Department of Energy’s oil statistics (Not that we necessarily believe those statistics).
4. Iran exports 2.4 millions barrels of oil a day. Saudi exports 9.5 million barrels of oil a day. The US imports 13.3 million barrels per day. Who do you think it benefits most to have cheap oil ?
Mexico’s economy loses steam
Marla Dickerson, LA Times
Sluggish manufacturing and falling exports to the U.S. are blamed for the deceleration. Slowing growth could spur emigration.
—-
MEXICO CITY – Mexico’s economy slowed in the last three months of 2006, and that could have consequences in the United States: Tough times in Mexico typically fuel immigration north of the border.
Mexico’s gross domestic product expanded 4.3% in the October-to-December period from the final quarter of 2005, according to figures released Friday by the finance ministry. It was the third consecutive period of slower growth in the nation’s economic output and a sharp decline from the 5.5% expansion registered in the first quarter.
The deceleration was blamed largely on a sluggish factory sector and a slowdown in exports to Mexico’s principal customer, the United States.
…the Big Three [auto company’s] woes are being felt south of the border. The Mexican plants of Ford Motor Co., General Motors Corp. and DaimlerChrysler account for about 70% of the cars assembled here, most of which end up in American showrooms.
A U.S. sales slump trimmed Mexican production and exports by 5% in December. The trend accelerated in January as exports tumbled to 88,915 vehicles, a 20.7% drop from January 2006.
…Meanwhile, consumer prices have been rising. Mexico ended 2006 with an inflation rate of 4.05%, up from 3.3% in 2005, sparked largely by skyrocketing prices for tomatoes, tortillas and other basic foodstuffs.
…Mexico’s oil sector probably won’t be as much of a help to the economy in 2007 as it has in years past. Petroleum prices have declined steeply since last summer’s record highs, meaning less oil revenue for Mexico’s treasury. Production also has fallen sharply at Cantarell, its largest oil field, a major worry in a nation that last year relied on petrodollars to fund nearly 40% of public spending.
(18 Feb 2007)
Mexico is experiencing a triple-whammy from oil-related problems: declining oil revenue, declining auto manufacturing, increasing food costs (especially tortillas, due in part to higher prices for corn because of corn ethanol. -BA
Chávez Threatens to Jail Price Control Violators
Simon Romero, New York Times
Faced with an accelerating inflation rate and shortages of basic foods like beef, chicken and milk, President Hugo Chávez has threatened to jail grocery store owners and nationalize their businesses if they violate the country’s expanding price controls.
Food producers and economists say the measures announced late Thursday night, which include removing three zeroes from the denomination of Venezuela’s currency, are likely to backfire and generate even more acute shortages and higher prices for consumers. Inflation climbed to an annual rate of 18.4 percent a year in January, the highest in Latin America and far above the official target of 10 to 12 percent. ..
“It is surreal that we’ve arrived at a point where we are in danger of squandering a major oil boom,” said José Guerra, a former chief of economic research at Venezuela’s central bank, who left Mr. Chavez’s government in 2004. “If the government insists on sticking to policies that are clearly failing, we may be headed down the road of Zimbabwe.”
For now, Venezuela remains far from any nightmarish economic meltdown. The country, which has the largest conventional oil reserves outside the Middle East, is still enjoying a revenue windfall from historically high oil prices, resulting in a surge in consumer spending and lavish government financing for an array of social welfare and infrastructure programs. Dollar reserves at the central bank total more than $35 billion. ..
(17 Feb 2007)
Airbus workers wait as job cuts statement delayed
EuroNews
The parent company of European aviation giant Airbus, EADS, has called off a meeting, in which it was expected to announce big job cuts in a restructuring plan.
The so-called Power-8 plan is reported to include factory closures and up to 12,000 redundancies, in the hope of saving five billion euros by 2010, and two billion a year thereafter. But Britain and Germany are threatening to review their Airbus defence contracts if the axe falls in their countries.
The multinational consortium’s co-President, Louis Gallois, says tomorrow’s meeting has been postponed because partner nations can not agree on how to share out work on the A350 aircraft. ..
(19 Feb 2007)
See also Airbus faces break-up as Germans and French fail to agree
