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Strategies & Market Trends : Strictly: Drilling II -- Ignore unavailable to you. Want to Upgrade?

To: Frank Pembleton who wrote (4144)	11/18/2001 12:35:08 PM
From: russwinter	Read Replies (1) \| Respond to of 36161

<Bomb them back to the Stone Age? > "Moving away" to me means that the US is going to line up other foreign sources (Mexico and Russia) of oil in a longer term process of weaning away from the ME. Of course there is no way the US can just abandon the ME until major alternative energy sources are developed, which is a few decades away at this stage. Putting in play a geopolitical strategy of supporting Russian oil interests and higher production levels at Saudi Arabia's expense is not at all the same as letting the ME be "talibanized".

To: Frank Pembleton who wrote (4144)	11/19/2001 12:53:18 PM
From: isopatch	Read Replies (2) \| Respond to of 36161

Frank. That's some solid geopolitical thinking on the ME and how we're going to handle the terrorism issue going forward. You go to college with Don Rumsfeld or does Gen Myers come up to Alberta to hunt and fish with you?<g> usatoday.com Isopatch

To: Frank Pembleton who wrote (4144)	11/19/2001 2:52:17 PM
From: Jacob Snyder	Read Replies (1) \| Respond to of 36161

re:I see at least 2 years of flat crude prices, at this level There are too many variables here that can affect the price of oil, and too many of those variables are impossible to predict, even approximately, into the future. Lower oil prices caused by: 1. global recession 2. price war between Russia and OPEC Higher oil prices caused by: 3. wholly unpredictable political/military events. 4. the very-LT trend of fields outside the ME being depleted, leading to OPEC regaining control over the market, and re-imposing monopoly prices. 4 we can forget about, as it is a very-LT effect, and isn't going to change anything in the next 2 years. 2 is the most important ST effect, and will, IMO, cause lower prices until the economic pain is too great for the players of this game of Chicken. In 1998, that point wasn't reached till oil was at $10. 1 is happening now, and will certainly get worse. The question is, how much worse? The consensus now is the recession is short and mild, ending mid-2002. The expectation of a sharp rebound in economic conditions, about 6 months out, is propping up a lot of stock prices. If that confidence cracks, then it will lead to expectations of yet lower oil prices, and the drilling stocks will probably take out their 1998 and September 2001 lows. 3 is the big unknown. Another WTC, a revolution in a major ME oil-producing country, could happen at any time, and would cause huge moves in stocks. The only way to play this is to keep cash in reserve, and wait for the "exogeneous shock". ---------------- I think what we are seeing now, is the revival of colonialism. It won't be called that, as that term is "loaded". It will be Colonialism By Proxy, so the faces of the local enforcers are native. But what else can you call it, when the Global Hegemon sets out on a policy of overthrowing and replacing governments it doesn't like, anywhere terrorists are? Putting in "cooperative" governments, who will "play by the rules", rules made by the Hegemon? We have to be very, very careful, not to provoke a nationalist backlash, which is exactly what Bin Laden wants. If we didn't replace the Iraqi government in 1990, it's unlikely we will now. I doubt the other ME nations would cooperate. I doubt the U.S. wants to engage in another war, and then take on the responsibility of cleaning up the mess afterward. We will probably try to contain rather than eliminate the threat. Same with N. Korea and Libya and Syria and Sudan. We'll find Bin Laden, declare victory, and go home. And hope for the best.