By Rich Kozlovich
Last week Anthony Dipaola and Golnar Motevalli published an
article entitled, “Venezuela Sees Crude inMid-$20s If OPEC Doesn't Act”, stating:
“Oil prices may drop to as low as the mid-$20s a barrel unless OPEC takes
action to stabilize the market” which the desire of , Venezuelan Oil
Minister Eulogio Del Pino. It appears the government of “Venezuela is urging the Organization of Petroleum Exporting Countries
to adopt an “equilibrium price” that covers the cost of new investment in
production capacity, Del Pino told reporters Sunday in Tehran. Saudi
Arabia and Qatar are considering his country’s proposal for an equilibrium
price at $88 a barrel”, and “OPEC
ministers plan assess the producer group’s output policy amid a global supply glut
that has pushed down crude prices by 45 percent in the last 12 months”
Does anyone besides me see the humor in all of this? The vast amount of the world’s oil – and the
price of oil - has not been controlled by Exxon – or any of the other companies leftists scream about– it’s been in the hands of socialist nations. These leftist hypocrites screamed against the
greedy capitalists raising prices unendingly and now the very countries they
laud are worried about …..watch out…..here in comes now….. falling prices.
Well, in Venezuela’s case it’s a lot more dire than just
the price of oil. It’s the desire for
anyone to purchase Venezuela’s oil in the first place. Venezuela’s crude
oil “is so viscous and thick with contaminants that only a handful of
refineries anywhere in the world can process the stuff. Almost all f those
refineries are on the Gulf Coast of the United States”. That was written by Zeihan in his book The Accidental Superpower, which I highly recommend.
The fact of the matter is this. Fracking will kill Venezuela oil production,
or at the very least – they will not be able to sell their oil at the prices
they’re trying to get OPEC to demand.
Whereas Venezuela’s oil is “viscous and think with contaminants”,
oil produced through fracking is sweet and light, in fact it “isn’t just sweet and light, it is
ultra-sweet and ultra-light, and so is remarkably easy to refine into light
distilled products, like gasoline." At the
current trend, “Venezuela will become the first energy producer in history to
not have a market”.
That’s just a part of Venezuela’s problems. Zeihan goes on to state Colombia and Venezuela
“are for all practical purposes in another world”, because the roads that link
them are remote and low-quality and their railroad doesn’t even connect
Columbia and Venezuela, they don’t connect with any other country either.
They don’t even
have the ability to easily travel into their own interiors. That means their only hope is to the north,
where all their populated centers face…….north….to the hated United States, who
is their only natural economic partner.
But the United States has no need to be involved in Venezuela – if Venezuela
wants that economic relationship with the U.S. – they will have to initiate it.
Now that does present a bit of a problem – don’t you
think? Hugo Chavez – when he was alive
and abusing his people with his insane leftist policies – wanted to “reduce his
country’s economic connections with the U.S. in general and those refineries” he needed to
accept his rotten oil specifically. He wasted huge sums promoting the very socialism
throughout South America that imposed crushing poverty on his own people. And
now if these socialist leaders in Venezuela want any kind of economy they’re
going to have to kiss some capitalist butt.
And won’t Sean Penn –
who just thought Hugo Chavez and his commie buddies were just dandy - be
thrilled about that?
Is this a case of paradise lost, or reality overcoming delusion?
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