Oil Prices Shoots Higher As Socialist Revolutions Grow

Ultimately, the Wikileak’s release of so many US Middle East cables revealed how utterly duplicitous the ruling elites were in regards to working secretly with the US and Israel to crush the Palestinians and of course, attack Muslims in Iran.  The Shi’ite/Sunni rift which is even older than the Orthodox/Catholic rift in Europe, was fed by cynical oil-pumping despots.  The revolutions shaking the very foundations of control of the Muslim world are also shaking other major institutions such as European capitalist dominance of Africa and Asia as well as the entire economic system of the entire planet as the price of oil shoots rapidly upwards.

The entire economic system of this planet is based on cheap energy from oil.  Period.  This is what has fueled the Industrial Revolution since around 1900.  Before 1900, the bulk of energy consumption for production came from coal, water and slave labor.  Trains and steam ships revolutionized the export/import industries tremendously and the new bulk carriers could burn coal and turn it into steam very easily.

But individual localized transport remained human/horse/oxen slow in nature.  Moving things from the docks or train depots to stores and communities was bottlenecked this way.  Gas automation revolutionized all of this.  Very efficient use of energy and eminently portable in the form of liquids, the use of oil for transportation as well as heating and fueling ships and trains which no longer had to carry bulky coal which had to be hand-shoveled into furnaces, this reduced the manual human labor, storage and cost and made transportation infinitely easier.

Thus, we now have a global trade system which runs mainly on oil which has totally overwhelmed all local economic systems and which depends on oil being extremely cheap and easily obtained.  But as we approach the Hubbert Oil Peak in more than one nation, this begins to show difficulties and problems.

The revolutions sweeping away an army of evil dictators all of whom have taken over since either WWII or since the fall of Nasser along with the creation of OPEC is roaring along like an offshore oil rig fire.  Like when the US watched in amazement as an explosion and fire caused an oil rig in the Gulf of Mexico to collapse and vanish in a few hours, so are the dictatorships vanishing.

This naturally means a crisis in international oil markets.  This, in turn, is being exploited by the international bankers and speculators who were bailed out at tremendous cost to the US and UK, who are hoarding oil and driving up oil prices rapidly.  This speculation bubble, in turn, is causing everyone to hoard oil whether it be a country or individuals, and since the ‘free market’ is our model here in the US, this means our government refuses to plan ahead and install rationing and other measures to prevent out of control oil price hikes.

Indeed, the silence on the part of our ‘planners’ and our ‘leaders’ is most significant.  No one is even daring to suggest we do anything at all, at any level, to deal with  Oil at $100+ a barrel.  Libya Oil Output Down 75%, Eni Says.  This is hammering Europe which is where most of the Libyan oil goes.

Traditionally, even the slightest rumor of turmoil or troubles in any oil pumping export power leads to sudden price hikes as speculators bid up contracts.  This news is a perfect example:  Nigeria: Gaddafi Threatens to Blow Up Oil Pipelines.  So far, revolutionaries in the Sinai Desert blew up the gas pipelines going to Israel.  For a dictator to even suggest blowing up all the oil pipelines in Libya is a gigantic red flag.

As the price shoots upwards, airlines, export shipping, manufacturers, etc. all goes upwards but more importantly, the profit margins vanish, sometimes totally.  This is due to the nature of all contracts: they are in the future.  That is, any instability in profits, price, costs, value of currency all hinge on some sort of stability.  Ever since the dropping of gold (please do remember, for nearly half a century, the price of gold versus the value of the dollar was totally stable, for example, from 1895-1932 and then the value of the dollar was cut in half versus gold which then remained stable from 1932-1970) so instead, we have the nightmare of floating fiat currency systems…all of which rest on the very unstable ground of the going price of a barrel of oil since this is the fundamental basic cost of all other systems!

This makes oil a key commodity.  The price of food and fluctuate all over the place and the only effect it has is, of course, quite dangerous—it destabilized the working and poor populations of the planet who get quite violent when prices suddenly rise—but this doesn’t have hardly even a slight effect on contract futures of all other things.  But the price of oil very greatly effects the price of food since oil is used to transport, grow and process almost all foods we consume.

So…the higher the price of oil, the higher the price of food.  This, in turn, causes governments to have very serious social problems and thus, leads to revolutions, riots and insurrections as we see today, spreading across the entire planet, not just Muslim countries.  They are the epicenter but trust me, this is one thing that will have wings flying over all parts of our planet including here in the US where we import more oil than any country on earth!

First, some interesting news:  Egypt to open Gaza borders in both directions Tuesday

  • The official, speaking on condition of anonymity, said that Egypt informed Hamas that Rafah crossing point will be open in both directions, a few days after it has been open for people trapped in Egypt.  An average of 300 Palestinians would be allowed to leave Gaza via Rafah everyday, the official added.
  • Hamas authorities on the crossing started receiving applications from travelers to control the flow towards the border, especially as the crossing had been closed since the revolt started in Egypt in January.  Patients, students and holders of visas and residency permissions of other countries are given the priority to travel.

The Palestinian genie is now out of the bottle.  The status quo created by the US and Israel is collapsing rapidly.  Once free, the people in the Gaza Ghetto will now be filled with hope, energy and rage and this will turn on everyone they get in contact with.  Will there be a ‘student alliance’ between the liberal students in Egypt?  I hope so.  The student/worker/poor alliance that brought down Mubarak is in its infancy.

Religious fundamentalism still is a very powerful force but what is interesting here is, the Egyptians were NATIONALIST opposition to Mubarak.  They made this as clear as possible, waving Egyptian flags.  The Palestinians had this ‘nationalist’ ideology but lost it over time after their crushing defeats at the hands of the world’s mightiest empire.  But now the Palestinian youth will revive the nationalist beliefs of the early PLO (which is now a US puppet organization) and this, combined with a possible confluence of goals between the Sunni liberals and Shi’ite liberals (these are the people who demonstrated against the government in Iran!) could lead the Muslim nations to true democracy with religious freedom rather than the US/UK/Israel model which is ‘separate and conquer’.  Will the Muslims figure this out?  I wonder.

Meanwhile, the decade-long hard push by the US (controlled by Israel) to isolate Iran and lock Iran up is going up in smoke and flames:  Iranian navy ships exit Suez Canal – Middle East – Al Jazeera says the experiment of the Iranians in cooperation with the troika of generals struggling to control Egypt has freed Iran so they can do what everyone else does: travel.

The isolation chamber set up by cruel US/Israeli powers is snapping apart at the seams.  Now, Iranian ships can patrol off of Gaza’s coast and contest control of this area and wrest it away from the Israelis who board unarmed civilian ships and beat and kill people just for trying to bring food to hungry Palestinians in the ghetto.  The ghetto is no longer a ghetto.

Here is the best news and analysis of what is going on today:  Al Jazeera English: Live Stream – Watch Now – Al Jazeera English

And Gaddafi loses more Libyan cities:

  • Protesters in Misurata said on Wednesday they had wrested the western city from government control. In a statement on the internet, army officers stationed in the city pledged “total support for the protesters”. The protesters also seemed to be in control of much of the country’s east, and an Al Jazeera correspondent, reporting from the city of Tobruk, 140km from the Egyptian border, said there was no presence of security forces. “From what I’ve seen, I’d say the people of eastern Libya are the ones in control,” Hoda Abdel-Hamid, our correspondent, said.

As more and more Gaddafi allies in the government desert him (the majority have at this point) the more that insane man screams he will keep on fighting.  So he sent his own mercenary goons in yellow hats throughout the only city he now barely controls and…had them beat up, harass and intimidate or even murder whoever they chose and they simply went wild.  Instead of stopping the revolution, this took people on the sidelines and moved them into actively working to stop him.

Whoever (some general who has already deserted and is fully armed) comes into Tripoli will be greeted by happy mobs as their savior.  The problem here for the oil consuming powers is, who can do this and how swiftly?  They still fear irritating the lunatic destroying his own nation and they are uncertain as to who is taking over.  But they just want someone, anyone to be in charge so the oil keeps on flowing and the oil contracts continue.

The problem here for the EU and US is simple: the ‘reforms’ imposed by Gaddafi were IMF/WTO ‘reforms’ which are intensely hated by the populace for the same reasons future Americans while hate these same rules.  That is, the rules imposed say, ‘NO socialism/no support in food prices/no welfare/sell off all assets to foreigners’.  And the US media kept out of sight all the ‘revolutionary leftist fist’ posters and signs in Egypt and this, not ‘freedom’ is what is spreading across the oil pumping/Muslim nations.  They want socialism!

This is much more frightful for any US analysts.  They can’t bear the thought that sane people in foreign lands might want socialism.  Here in the US, ‘socialism’ is a dirty word and children are raised to fear and hate socialism.  But that is insane.  Demanding that we live in a dog-eat-dog world where banking gnomes eat us, them being the ‘dogs’ here, is insane.  No sane human society since the invention of human societies a million years ago, has ever tried to live in such a fashion for long.  It is literally self-defeating.

The earliest agricultural societies such as early Egypt had socialist food distribution systems.  The roots of all state religions is tied directly, totally and completely to the concept of a priest/king state redistributing grain during times of difficulties.  The public storage and handing out of grain is the entire, total and complete basis for all governing systems going back thousands of years!  Just as ‘money’ exists only if there is a socialistic style government redistributing food as the basis for giving ‘money’ meaning as a unit of exchange!

Back to Antiwar.com‘s excellent news aggregation page:  Pakistan’s Intelligence Ready to Split With CIA while Two CIA Contractors Spirited Out of Pakistan.  Even the NYT carried the story about how the man being held for shooting to ‘robbers’ in Pakistan is really an undercover CIA agent who is the guy targeting victims of our assassin robot killing machines which are so very hated by the good people of Pakistan.  Gah.  End that odious, stupid and futile program, please.  All it does is make people hate us.

One story that is making the rounds today is also interesting in that before today, many people were outraged when the Lockerbie assassin who planned the entire crime was released from UK prisons to go to Libya.  Now, the anti-Gaddafi (note how the AP spells his name differently from the BBC!) a former judge in Libya is spilling the beans:  The Associated Press: Report: Ex-minister says Gadhafi ordered Lockerbie.  This, in turn, can pull down politicians in the UK.  The bomber was released so Gaddafi could sell more oil and ‘liberalize’ IMF-style his country so European powers could exploit the people there better.  A bad deal all around, for the citizens of that country as well as England.

Finally, as I predicted:  Region’s Protests Spread to Morocco – WSJ.com

  • The protests attracted 37,000 people around the country Sunday and were generally peaceful, Interior Minister M. Taieb Cherqaoui said at a press conference. He said looters had damaged more than 100 buildings, including a bank in the port town of Al Hoceima, where five people died in a fire. He also said 128 people were wounded, mostly police. It wasn’t possible to verify those figures independently Monday.

Thanks!  I was worried this might not happen!  Good luck to all of the fine people of Morocco.  May you all be as successful as the Tunisians, Egyptians, Bahrainians and hopefully, Libyan citizens.  My blessings.

The CIA drone assassinations and wars against the civilians is collapsing in Yemen:  Seven Yemeni Ruling Party MPs Resign Over Crackdown and Yemen is even closer to the king of SA:  Saudi Arabia’s King Abdullah promises $36 billion in benefits – CSMonitor.com

  • As other leaders across the Middle East scurry to appease discontented citizens, the king introduced 19 new measures estimated to cost 135 riyals ($36 billion), according to John Sfakianakis, chief economist of Banque Sausi Fransi. The measures address inflation and housing, expand social security benefits, and ease unemployment and education costs – two areas of particular concern to Saudi youths…
  • …In a move timed to the king’s return Wednesday, a group of 40 young Saudis, mostly journalists and rights activists, signed an open “Letter to the King.” The signers say they were inspired by Arab youth elsewhere, and by the king’s encouragement of national dialogue. They asked for elections for the advisory Shura Council, the right of women to vote and run as candidates, strong anticorruption measures, and greater fiscal transparency and accountability.
  • In addition, they want the cabinet reshuffled so that ministers’ average age, now 65, is reduced to 40.In another effort – albeit one that did not get very far – 10 moderate Islamists, including university professors and lawyers, defied the ban on political parties and announced they were forming the Islamic Umma Party.
Looks like the dead guy is still alive.  He ran out of his own country for several months and probably isn’t very functional but they had to drag him back home to display to everyone to head off the revolution brewing underground.  Note that he is disgorging a huge amount of loot he and his fat, greedy little twerps had stashed away for their own private use.  He knows his head will be on a pike in no time at all unless he does this.  The question is, will he REALLY do this?
I seriously doubt it.  He is making this promise in order to stop the revolutionaries.  He thinks the promise will be forgotten in a few months and he can then continue to run his North Korean-style terror state with personal impunity.  Well, this promise to expand SOCIAL SECURITY and price supports will have to happen or else and note that even this guy, the dying despot, recognizes this revolution sweeping Muslim countries is SOCIALIST in nature!  Not religious.  Socialist.  And this is the real story.  Not war, not peace but a demand for socialism!  Amazing, isn’t it?

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16 Comments

Filed under .diplomacy, .money matters, energy, Free Trade, gold, Politics, religion, war and peace

16 responses to “Oil Prices Shoots Higher As Socialist Revolutions Grow

  1. LesserFool

    Thanks for another wonderful, thought provoking commentary on today’s news.

    I don’t think socialism is what the people in the Middle East want. They don’t care what form the government takes, as long as their life improves, and they have some input (democracy) and freedom. I’ve heard it said the first Muslim revolution was throwing out the Colonial rulers, and this second one is throwing out the corrupt dictators … for democracy. For a voice. For some freedom. For a better life.

    The question of socialism vs. capitalism is probably far from their minds. They just want a better life, which for them starts with freedom from oppression by a selfish, corrupt dictator.

    I also disagree that the opposite of socialism is “a dog-eat-dog world where banking gnomes eat us.” True freedom means economic freedom, which means the people control the creation of money, and reap its benefits, not international bankers, not government officials and their friends, and not the military-industrial complex. You can have a true capitalist system, with worker protection and rights, with economic freedom = competition, if you have limited government (no monopolies at all, except for very few government things, like defense/public safety and some services) with a limited social safety net, if you have the people = the public control and benefit from the money system, not private banks!

  2. Duski

    Well, what is socialism? Nearly all societies have some levels of it, and absolutely every society with decent amounts of freedoms has some of it.

    At the end of the day, only question is how much of the common wealth will / should we share with each other. But current system is neither capitalism or socialism, it’s just oligarchy of the elite looting all systems together and breaking the existing laws without ever getting prosecuted for anything.

  3. LesserFool

    @Duski,

    Well said! Socialism doesn’t deal well with the free-loader problem, and pure capitalism doesn’t do very well protecting the poor. I’m sure there’s a good balance there somewhere.

  4. Melponeme_k

    I can’t help being excited for all these revolutionaries. It is causing a domino effect, it will cause a lot of pain here. But mostly it is causing pain to our collective jailers.

    We are all in the gangster, bankster illegal prison. They are making a run for it. And it makes me happy to see them succeed.

    However when we in the US do fall, its going to cause a lot of world pain. A lot of countries depend on us sucking in their exports, depending on our overgrown military, and our agricultural subsidies. Once that is gone, its going to be rough. Especially for the EU, China could get through it. We will probably see a more militarized Germany again because I know that country won’t agree to go down in flames for the EU Union.

  5. JT

    @duski and LesserFool

    The wisdom is somewhere in the mid atlantic.
    West of Brussels and east of Washington.

    I think we will find the right balance just before we can´t afford our socialism anymore.
    Corporate (US) or freeloading (EU).
    😀

  6. wuen

    Seeing the price of oil go up, I wonder how long our current system of capitalism of the past few decades will be able to sustain itself.

    Our system of capitalism favor profit over economic development. For example, industries ship material over half circumference of globe to build product then ship back another half circumference of globe to sell it to make big profit. This is not very efficient used of energy. Our energy is not unlimited and not without consequence to environment. I believe the material should not need to circulate more than 3/5 of the circumference of the globe for us to use transportation energy efficiently. This mean that capitalism system base on profit does not equal to economic system since it is not efficient use of transportation energy.

    Something is wrong in our capitalism system. What is wrong is shown in the following phrase: to say our capitalism system is an economic system is wrong because we waste lot of energy for production and distribution of goods.

    Once we confirm our capitalism system is not an economic system of distribution and production of goods, how should we describe our capitalism system? To be able to solve our current problem, it require an accurate describe of our current capitalism system. We can’t improve a situation if we do not have a good understanding of the situation.

    I believe we have a wrong view of our capitalism system because I hear people say capitalism is “an economic system based on the private ownership of the means of production and distribution of goods, characterized by a free competitive market and motivation by profit”. I hope someone will correct this and show existence of contradiction between capitalism system motivated by profit and economic system.

  7. Old Ari

    As far as energy is concerned you are getting close to the truth. The only real Capital is energy,now that most of the cheap energy has been used, it’s back to solar and nuclear(assuming nuclear is net positive} for capital.
    Ultimately, this leads to a world population, not much larger than, 16thC.

  8. JT

    @Old Ari

    Norway is the most capitalist country in the world?
    “Electricity generation in Norway is almost entirely from hydroelectric power plants. Of the total production in 2005 of 137.8 TWh, 136 TWh was from hydroelectric plants, 860 GWh was from thermal power, and 499 GWh was wind generated. In 2005 the total consumption was 125.8 TWh

    Norway was the first country to generate electricity commercially using sea-bed tidal power. A 300 kilowatt prototype underwater turbine started generation in the Kvalsund, south of Hammerfest, on November 13, 2003.”
    http://en.wikipedia.org/wiki/Energy_in_Norway#Electricity_generation

    They have 105 000$ per citizen in a government pension fund.
    “As of 19 October 2010 its total value is NOK 3 trillion ($512 billion), holding 1 per cent of global equity markets. With 1.78 per cent of European stocks,it is said to be the largest stock owner in Europe.
    http://en.wikipedia.org/wiki/The_Government_Pension_Fund_of_Norway

    Richest country in the world?

  9. JT

    @Old Ari

    Norway is the most capitalist country in the world?
    “Electricity generation in Norway is almost entirely from hydroelectric power plants. Of the total production in 2005 of 137.8 TWh, 136 TWh was from hydroelectric plants, 860 GWh was from thermal power, and 499 GWh was wind generated. In 2005 the total consumption was 125.8 TWh

    Norway was the first country to generate electricity commercially using sea-bed tidal power. A 300 kilowatt prototype underwater turbine started generation in the Kvalsund, south of Hammerfest, on November 13, 2003.”
    http://en.wikipedia.org/wiki/Energy_in_Norway#Electricity_generation

    They have 105 000$ per citizen in a government pension fund.
    “As of 19 October 2010 its total value is NOK 3 trillion ($512 billion), holding 1 per cent of global equity markets. With 1.78 per cent of European stocks,it is said to be the largest stock owner in Europe.
    http://en.wikipedia.org/wiki/The_Government_Pension_Fund_of_Norway

    Richest country in the world?
    And very much socialist.

  10. emsnews

    All good comments. What is socialism? How much do we have before it fails? This is a burning issue going way, way, way back in time. We do know from history that rulers who cut social services while hogging all the wealth end up DEAD. Either the populace lets invaders come flooding in who are seeking the loot or the populace rises up and destroys everything.

    This is why rich people have to read history very, very carefully. It is full of warnings to them to not abuse the power to concentrate wealth into a few hands. There is a lot of history about this…always, it ends with someone ‘liberating’ all that loot, usually, very violently.

  11. floridasandy

    i best most americans would be surprised to know that we get most of our oil from canada and mexico.

    ΩΩΩΩΩΩΩΩΩΩ

    ELAINE: I point this out frequently. Yes, we do and yes, people here are unaware of this.

  12. JSmith

    “Oil Prices Shoots Higher As Socialist Revolutions Grow”

    What makes you think they’re socialist? Nostalgia for the Sixties?

    I don’t think those people have decided what they’re “for” yet – they’re still busy being “against” something.

    ΩΩΩΩΩΩΩΩΩΩΩΩ

    ELAINE; Simple: they are demanding more social help from a government that represents them, not the very rich. How can anyone miss this?

  13. Claire Voyant

    Italy imports 400K barrels of Libyan crude per day, with billions of euros in bank loans hanging in the balance. European bondholders are now even more exposed to risky italian credit>

    With the disruption of the Libyan oil source, look for the shaky Italian economy to tremble and threaten the EU until NATO or private mercenary forces intervene

  14. fred ferd

    Marx is the father of current political thought and has been since the beginning of the new deal. who can deny that all major western socities are deeply involved in the re-distribution of wealth. the fact that corruption trumps humanitarian ends could not have been a surprise to marx. human greed and thievery have been around since the earliest days. as marx said, from each according to his capabilities to each according to their needs. bankers are an insecure bunch….they NEED status, young women and fast cars. who can deny them what they need. Muslims also have needs, as do jews, mexicans and clergy. if the jewish have a monopoly on world finance and money, news and entertainment, then that where they put their efforts, and those needs are met. How many goys have actually tried to set up a national banking and currency system? How many goys were tinkering in their garages, like henry ford, trying to set up a global credit card system for which they would receive huge payoffs? Obviously, this was not as important as watching american idol or shopping for shoes at nordstrom. people put there energies towards satisfying their needs. as the jewish met with almost unfathomable wealth and power, they have still been very accommodating overlords. Most americans don’t do much and live very well. as with all slaves, they grumble and complain about their lot, but after all is said and done, they drive in their cars, live well in their homes, are entertained with lcd television, movies, internet…all of which they had nothing to do with creating. you, elaine, actually do some work. shovel snow, cut wood and repair your house. you have a pioneer spirit and deserve to live without aggrevation for higher powers. how many americans are willing to do that?

  15. wuen

    I wonder if ever we will able to completely remove corruption from society.

    I guessing corruption is to stay for a long time. Should society accept this and adapt to it? If society accept it, then how to minimize corruption. Maybe by identifying what is consider corruption and understanding it procedure to contaminate people mind it the first step. What come after as the remedy depend on the first step.

  16. emsnews

    There is no magic cure for corruption. It grows naturally out of systems. There is a way of limiting it and this is via democracy, the rule of laws which are enforced and a ‘moral culture’ that does NOT believe ‘greed is good’.

    The US fell for this ideology under Reagan. Celebrating being rich, celebrating being ruthless, the pretense that cutting people out of jobs was being ‘tough’ and so on is an evil social belief system and basically is amoral as we see so very clearly now.

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