Oil: A global crisis

[marmar]

from the Independent UK:



Oil: A global crisis

The Iraq War means oil costs three times more than it should, says a leading expert. How are our lives going to change as we struggle to cope with the $200 barrel? Geoffrey Lean reports

Sunday, 25 May 2008



The invasion of Iraq by Britain and the US has trebled the price of oil, according to a leading expert, costing the world a staggering $6 trillion in higher energy prices alone.

The oil economist Dr Mamdouh Salameh, who advises both the World Bank and the UN Industrial Development Organisation (Unido), told The Independent on Sunday that the price of oil would now be no more than $40 a barrel, less than a third of the record $135 a barrel reached last week, if it had not been for the Iraq war.

He spoke after oil prices set a new record on 13 consecutive days over the past two weeks. They have now multiplied sixfold since 2002, compared with the fourfold increase of the 1973 and 1974 "oil shock" that ended the world's long postwar boom.

Goldman Sachs predicted last week that the price could rise to an unprecedented $200 a barrel over the next year, and the world is coming to terms with the idea that the age of cheap oil has ended, with far-reaching repercussions on their activities.

Dr Salameh, director of the UK-based Oil Market Consultancy Service, and an authority on Iraq's oil, said it is the only one of the world's biggest producing countries with enough reserves substantially to increase its flow.

Production in eight of the others – the US, Canada, Iran, Indonesia, Russia, Britain, Norway and Mexico – has peaked, he says, while China and Saudia Arabia, the remaining two, are nearing the point at of decline. Before the war, Saddam Hussein's regime pumped some 3.5 million barrels of oil a day, but this had now fallen to just two million barrels. ......(more)

The complete piece is at: http://www.independent.co.uk/environment/green-living/oil-a-global-crisis-834023.html

[TNDemo]

1. Great article.

Thanks for posting this. I think I have the answer to the question I have been asking for six years, which is why the heck we invaded Iraq. I knew oil was part of it but I didn't know about the deal Iraq was trying to make.