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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Win Smith who wrote (23597)	4/5/2002 12:24:14 PM
From: Nadine Carroll	Read Replies (1) \| Respond to of 281500

First, you seem to be assuming that for an Arab boycott, to "work", it would need to be in the long term economic self interest of the mideast producers. Given your usual "Arab mind" view of rationality in that region, I find that an amusing assumption on your part. You're right, I was assuming slightly more purpose to the exercise than a child's "I'm gonna hold my breath until I turn blue" temper tantrum. A boycott hurts the boycotters, first of all, by cutting into their sales. If they don't think they can also hurt the intended victims, by cutting into his purchases or at least raising his price (for more than a few days), it's a very counter-productive program. And yes, I do believe Arabs can make this calculation as well as other people, though their injured pride might cause them to spend a lot of time in unwise bluster. Second, the idea of a "market glut" in the face of a real boycott seems to be considerably more hypothetical than the boycott idea itself I'm not an expert; I just read articles in FA. The gist of the article, as far as I could tell, was that the oil boycott was no longer an effective weapon because Russia and Canada -- not members of the cartel -- would happily step into the breach and improve their own market share. Also, Saudi Arabia and the other Arab oil producers no longer have as much money as they did twenty years ago to sustain them through the boycott.

To: Win Smith who wrote (23597)	4/5/2002 12:32:10 PM
From: BigBull	Read Replies (2) \| Respond to of 281500

Oil prices are definitely carrying a "war premium" these days, and it is completely inconsistent with supplies. eia.doe.gov US Crude stocks are consistent with prices in the teens. The Russians are building up very large stocks by continuing at near full capacity but not shipping. Crude prices in Russia a few weeks ago were the equivalent of $4 bbl. Trust me, $30 oil will bring a whole lotta oil on the market. Khameinis plan to sell only to certain countries and only for a month is a real loser. We agree on a better energy policy, fwiw. Time for Hydrocarbon man to die a swift death. :o}