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Pastimes : No Mideast Oil Products - A petition
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To: Sam Raven who wrote (125)10/16/2001 1:20:45 PM
From: BigBull  Read Replies (3) of 280
 
I believe you are incorrect. OPEC greatly fears the following:

1. Conservation.
2. Development of alternate energy sources.
3. Increased oil production from non-opec sources.

This fear is generated by the painful lessons OPEC learned the last time they used "oil as a weapon" in the seventies. OPEC has attempted to keep prices below the level at which all three elements are initiated. That is what the "price bands" are mainly about. OPEC learned:

1. Don't kill your best customers.
2. Don't economically strangle your best customers.

Due to the principle of "the law of unintended consequences" oil has indirectly and tangentially been, once again, "used as a weapon." The funding of terrorist operations and the resultant terror attacks on the chief consumer of oil has induced a severe recession that has become global in scope. So OPEC has already "screwed the pooch" and will be forced to cut production to support prices while ohter producers will produce flat out. It appears OPEC will have to relearn the lessons of the seventies.

While market forces will serve to chastise OPEC severely in the upcoming months, imo that is not sufficient pressure. Active steps taken by the whole world (lead by the US) to ensure that OPEC really gets the message. This will require entering the political realm. If the chief consumer of oil products leads the way in reducing consumption and if it correctly frames the debate; only a very small amount of world wide consumption reduction will cause Arab producers to seriuosly re-consider funding of terrorist operations. Right now, this issue is not even on the political radar. The US press and politicians are now obsessed with Anthrax, coalition building, and radical Muslim demonstrations.

Time for all consumers of oil use our "assymetric weapon", our wallets. Ultimately, the industrialized economies of the world will have find another energy source to power their economies. I cannot think of a better time to start that process than now. If not now, when? I therefore, laud the attempts of this board to put this issue back on the radar screen. If the change is inspired at the grass roots level, so much the better. It will give citizens of the US and the rest of the industialized world something constructive to do.
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