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

To: Jacob Snyder who wrote (90452)	4/5/2003 9:51:54 PM
From: quehubo	Respond to of 281500

<<1. Energy Independence. Doing this, even threatening to do this, even a partially successful attempt at doing this, changes the whole balance of power, and will deeply scare the Saudis. This is a pre-condition for other efforts to succeed.>> The threat of the US companies investing in Iraq to increase production is a huge threat for two reasons. First in the near term Saudia Arabia does not have sufficient capital to develop its energy industry and needs oil majors investments. Secondly in the future Iraq's production could grow and Iraq could become more of a swing producer thus taking some reliance from SA. Saudia Arabia is crucial today because they have billions of dollars invested in EXCESS capacity that they use to stabilize oil markets when they are disrupted. Venezuela, Iraq Nigeria. Energy independence is pie in the sky illusion. Approximately 2/3 of all oil sits under Persian Gulf countries. You wont be convincing anyone that they should give up their SUV's. Even if we reduced our demand 30%, we would still be in for a tremendous economic shock if Saudia Arabia collapsed and exports stopped.