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Guest Post: Want to Put Iran Out of Business? Here's How

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Submitted by Charles Hugh Smith from Of Two Minds

Want to Put Iran Out of Business? Here's How

Those attempting to pressure Iran by increasing "tensions" and thus the price of oil have it precisely backwards. The one sure way to fatally destabilize the Iranian theocracy is to adjust the demand and supply of oil so the price plummets (as it did in December 2008) to $25/barrel, and stays there for at least six months.

It has been estimated that the Iranian theocracy cannot fund its bloated bureaucracies, military and its welfare state if oil falls below around $40-$45/barrel. Drop oil to $25/barrel and keep it there, and the Iranian regime will implode, along with the Chavez regime in Venezuela.

Saber-rattling actually aids the Iranian regime by artificially injecting a "disruptive war" premium into the price of oil: they can make the same profits from fewer barrels of oil.

The way to put them out of business is drop the price of oil and restrict their sales by whatever means are available. They will be selling fewer barrels and getting less than production costs for those barrels. With no income, the regime will face the wrath of a people who have become dependent on the State for their sustenance and subsidized fuel.

How do you drop oil to $25/barrel? Easy: stop saber-rattling in the mideast and engineer a massive global recession with a side order of low-level trade war. Though you wouldn't know it from the high price of oil, the world is awash in oil; storage facilities are full, and production has actually increased a bit in North America.

Long-term, Peak Oil is a reality; but in the short-term, production is more than adequate to meet recession-suppressed demand.

The way to drop oil from $100/barrel to $25/barrel is to crush demand via global depression. Let's face it, the global economy is already slipping into depression as credit bubbles pop and austerity and rising debt service expenses bleed off disposable income.

We can nudge the global demand for oil off a cliff with a few other policies, for example, a low-grade trade war with China and Japan. Political leaders everywhere are already itching for a scapegoat, and imports are ready-made and waiting. Slap some heavy tariffs on Chinese and Japanese goods for "dumping" or some other excuse and then the inevitable counter-tariffs will be imposed on U.S. imports. Since U.S. exports to Asia are but a thin slice of imports from those nations, even a low-key trade war will have outsized negative consequences on Asian exporters.

Exports make up a relatively small percentage of Japan's GDP (ditto for the U.S.), but they contribute most of the marginal growth and profits in the Japanese economy. China is hugely dependent on exports and fixed investment in factories and real estate. There is no way the Central Government can spend its way out of the hole created in the Chinese economy as the real estate bubble pops, exports plummet and foreign direct investment dries up.

Europe is already caught in a vice of austerity and rising debt service expenses, so a depression there is already in the pipeline.

In the U.S., a $1 per gallon tax on all liquid fuels would cause short-term pain but would put significant downward pressure on oil consumption. Even without this tax, U.S. consumption will crater as the global economy contracts and Federal spending finally stops rising.

The most important fact about the global pricing of oil is that price is set on the margin. That means that if global demand falls by 10% from 80 million barrels a day (BPD) to 72 million BPD, price will not drop by 10%--it will fall far more.

It is instructive to recall that the mere threat of global depression in late 2008 sent the price of oil under $30/barrel in very short order.

Supply needs to overwhelm demand for at least six months to put the Iranian theocracy out of business. For that, the U.S. needs its exporting allies such as Canada, Mexico and Saudi Arabia to continue pumping even as prices collapse.

As I have often noted in my "head-fake" series on oil pricing, rapidly plummeting prices set up a positive feedback loop which further suppresses price: as regimes like Iran find their income from oil exports falling below their minimum survival level, the only way they can raise cash is by pumping more. This extra oil hitting a market awash in oil will only further suppress price.

Alternatively, they can withdraw their oil from the market in the hope that this reduction in supply will cause prices to rise. Unfortunately for Iran and Venezuela, their production isn't large enough to overcome a 10% reduction in global demand. Six months into their forced-austerity program created by their net income from oil exports falling to zero, they will find the streets filled with hungry, angry citizens.

That will be the end of those regimes.

So the first part of the solution to Iranian hegemony is to actively pursue high-visibility diplomacy in the mideast, repeatedly declare "war is not the answer," etc., and announce some major diplomatic initiatives, even if they are totally for show. That will drop the price of oil $20/barrel in short order.

Then quietly gain the support of the major exporters to continue pumping even as oil prices collapse. The Saudis and other major exporters can survive six months of low income from oil; the Iranians and the Chavez regime cannot.

Lastly, impose austerity, write down debt, squeeze lending, initiate some low-key trade wars and cut Central State spending, all of which will trigger a severe contraction in the global economy and in demand for oil.

Then once the Iranian nuclear threat has been throttled by a collapse in that regime's income stream and by a populist regime change, pro-growth policies can be restarted--and perhaps this time, if debt has been written off en masse and the predatory financial sector is finally allowed to implode in insolvency, they will actually be effective.


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Thu, 01/05/2012 - 15:32 | 2036396 trav7777
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Thu, 01/05/2012 - 15:34 | 2036410 CrashisOptimistic
CrashisOptimistic's picture

The only thing I can imagine is the blog's business model accepts paid posts by ppl trying to pimp themselves.  This if so profoundly stupid there can't be another answer.

Thu, 01/05/2012 - 15:37 | 2036423 jcaz
jcaz's picture

"This if so profoundly stupid..."

Uh, ok......

Thu, 01/05/2012 - 15:39 | 2036437 Ahmeexnal
Ahmeexnal's picture

Only thing more stupid is the "peak oil" racket promoted by Al-Gore and other members of the power elite.

Thu, 01/05/2012 - 15:57 | 2036535 CompassionateFascist
CompassionateFascist's picture

Chuck should take up plumbing. Israel wants US to attack Iran, US will attack Iran.

Thu, 01/05/2012 - 16:04 | 2036562 Conrad Murray
Conrad Murray's picture

No way. The US is the greatest nation of badasses on Earth. The US takes orders from NOBODY, not even chosen people. I dare you to prove otherwise.

Thu, 01/05/2012 - 16:57 | 2036791 Bansters-in-my-...
Bansters-in-my- feces's picture

Get your head out of your ass and give it a good shake bozo Conrad

There is alot of shit on your face.


Fri, 01/06/2012 - 04:27 | 2038384 AldousHuxley
AldousHuxley's picture

BEST way to put the entire middle east out of business?



Open all oil pumps, lower oil prices.

Unleash that Saudi 100 year oil reserves all at once.


But Iran is an ex Persian empire not just a rogue state. They have their own exchange the iranian bourse, their own global press PressTV, own culture, make their own fighter jets, etc.


Instead of invading Iran with US taxpayer funds, US should outsource trading and banking to Iran to do it cheaper and save tax payers some money. Global competition is good for you!


Thu, 01/05/2012 - 19:10 | 2037389 quintago
quintago's picture

I stopped reading after it go to get oil to $25/bbl.

The country ran on $8/bbl oil a decade or so ago. Taking it to $25/bbl will hurt, but you're dealing with people and nations whose "long term" planning involves more than looking 5 years into the future.

This article is enough grounds to revoke this man's privileges from posting to ZH; truly degrades from the credibility of this site!

Fri, 01/06/2012 - 02:58 | 2038286 Urban Redneck
Urban Redneck's picture

This will be the moment when the rise of the oceans begins to slow and our planet begins to heal as Unicorns shall shit Skittles...

This childish idiocy belongs in academia, not the big bad world in which the human race actually exists.  The window on this strategy closed a long time ago (in an HFT world).  The increase in the US money supply since the last oil crash makes a repeat of $30USD impossible, even in the face of a Global Great Depression.  Furthermore, the "enlightened" foreign policy of the US--- of burning bridges with the marginal producers, delaying production increases at home and abroad (whether by MIC insertion or withdrawal), alienating historical allies who are larger producers, and aggravating "less than allies" who are the other large producers and consumers significantly reduces the lower bounds to which to the oil price can be driven. 


Thu, 01/05/2012 - 22:52 | 2037855 Harlequin001
Harlequin001's picture

Conrad, and just how do you suggest that anyone might 'prove' this?

Would the fact that you can't fight wars on your own be sufficient, or that you pay to establish military bases where you can and then pack up and fuck off like good little boys when you're told to?

Every other empire in history has established its authority through the imposition of government, so let's not misunderstand each other, the US takes orders from everybody and pays the bill to boot. You're not a nation of badasses, you're a nation of fucking mugs.

Stop dreaming, your comments are about as useful as the article.

Thu, 01/05/2012 - 16:05 | 2036571 redpill
redpill's picture

Drop the price of oil to $25 just like that eh?  I wonder if Chuck was Michele Bachmann's economic advisor...

Thu, 01/05/2012 - 16:39 | 2036701 hwwesq3
hwwesq3's picture

How to drop it?

Just like with gold and silver:  the CME repeatedly raises oil margins, day-by-day, to reach 90%.

U.S. strong-arms other exchanges to do the same, with the promise of just a six-month limit.

Thu, 01/05/2012 - 17:24 | 2036948 lolmao500
lolmao500's picture

Yep. Easy to do... raise the fucking margins to 100%.

But low oil prices doesn't make the elite money nor does it make people poorer.

So no.

Fri, 01/06/2012 - 00:43 | 2038090 prole
prole's picture

Technically the easiest way to drop oil to 25 a barrel is to sell oil at 25 a barrel non?

And PS no I don't want to put Iran out of business.
Who the fck wrote this article? Please put yourself out of business TIA.

Fri, 01/06/2012 - 04:28 | 2038347 zhandax
zhandax's picture

But low oil prices doesn't make the elite money nor does it make people poorer.

BINGO! This is why this plan is a non-starter.  TPTB makes mondo jack with $100 and up oil and they can continue to suck the last few shekels out of what remains of the US middle class.  Add onto this the profit potential from supply and support of a new war effort against one of the 'axis of evil' (profit potential which is probably already factored into many corporate 2012 earnings estimates).  Or they could forgo this by selflessly sacrificing all this profit potential as well as taking a loss on their oil trading and equity positions as global depression engulfs a planet already creating trillions in new funds to stave off said depression.  And don't forget this global depression will further accelerate the shrinkage of the shadow banking derivative pool which will likely take the TBTF banks down for the count.  Do we bet on the buzzards, or do we bet on the saints?  FAIL.

Thu, 01/05/2012 - 16:51 | 2036761 Kayman
Kayman's picture

"I wonder if Chuck was Michele Bachmann's economic advisor..."

Uh... no.... but he makes a hell of a corndog...

Thu, 01/05/2012 - 16:06 | 2036576 Rusty.Shackleford
Rusty.Shackleford's picture

The only thing more stupid than that comment is, the idea that we can consume a finite resource infinitely.

Thu, 01/05/2012 - 16:14 | 2036607 Ahmeexnal
Ahmeexnal's picture

riiiiiiiiiiight.....oil is finite because of it's biotic origin from dinosaur carcasses.

You should just STFU.

Thu, 01/05/2012 - 16:19 | 2036622 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

So where's the fucking oil?  No one is producing your magic oil, so where the fuck is it?  Does Rotheschilde have it up his ass, because no one knows where it is!

Thu, 01/05/2012 - 16:23 | 2036636 Ahmeexnal
Ahmeexnal's picture

I forgot you are an illiterate sad fuck.
Therefore you have not read up on countless MAJOR oilfields being discovered in Brazil, Norway, Cuba, Mexico, Libya, and countless other places.
So if oil is finite because of it's dinosaur origin (as "peak oil" trolls claim), this means Jurasic Park is based on true facts.
Scientists have been cloning dinosaurs by the millions, killing them, submitting their corpses to high pressures, and obtaining major oil fields as a result.

Thu, 01/05/2012 - 16:31 | 2036668 JW n FL
JW n FL's picture

you are correct about us not running out of oil.

Thu, 01/05/2012 - 16:44 | 2036723 Ahmeexnal
Ahmeexnal's picture

Rubin is another Soros puppet just like Michael Moore and Al Gore.
He even uses the same catch phrases like "inconvenient truth".
Let him speak longer and he'd probably spew out "I invented the Internet".

You don't need to "BURN OIL" to transport stuff.

Thu, 01/05/2012 - 17:41 | 2037051 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

If A then not B?  Bawhahahahahahahaha!!!!!!!!

Thu, 01/05/2012 - 16:51 | 2036762 LawsofPhysics
LawsofPhysics's picture

Don't waste your time JW, let the fucknuts be fucknuts.  The world will indeed stop using oil with plenty of it still in numerous sources.  Lots of other things are going cause big problems for life (as we know it) on this planet long before the oil is ever gone.

Thu, 01/05/2012 - 16:56 | 2036785 Hephasteus
Hephasteus's picture

Spoken like a man that understands big giant lungs and large 4 chamber heart can suck up 10 to 20 times background radiation into your body.

Stamp hoover on your ass and go jogging.

Thu, 01/05/2012 - 18:27 | 2037245 LawsofPhysics
LawsofPhysics's picture

You first idiot.

Fri, 01/06/2012 - 04:44 | 2038476 zhandax
zhandax's picture

The stone age did not end for a lack of stones....

Thu, 01/05/2012 - 16:39 | 2036700 BobPaulson
BobPaulson's picture

Show me somebody who has an IQ over 100 who says it's dinosaurs. What are you talking about?

Meanwhile, show me the discovered oil graph versus time with all these new finds compared to the Ghewar, Bhurgan and Cantrell. If you read a little, you will see that peak oil is simply about the oil getting progressively more expensive and EROEI going down, which is exactly what is happening.

Good luck getting that $25 a barrel and required price rigging and conspiracies, jews taking over the world, yadda yadda.

Thu, 01/05/2012 - 16:50 | 2036757 Ahmeexnal
Ahmeexnal's picture

Please look at a graph of oil priced in gold during the last 40 years.

Thu, 01/05/2012 - 17:40 | 2037038 trav7777
trav7777's picture

JFC, you are stupid.

Show us the "MAJOR" oilfields.  We could use a good laugh on such a grim topic.

Production matters, not exaggerated URR

stupid fuck.

Thu, 01/05/2012 - 17:45 | 2037063 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

They're in Candyland.  Before we find the oil, let's get to work finding the magical neverending coco fields!

Thu, 01/05/2012 - 20:40 | 2037602 Hephasteus
Hephasteus's picture

But yet he makes a point. It's not hard to imagine a bacteria that converts carbohydrates to hydrocarbons. Why is it so hard to imagine a biological or even purely chemical process that makes the stuff from excess core energy.

Thu, 01/05/2012 - 23:03 | 2037895 Lower Class Elite
Lower Class Elite's picture

It's also not hard hard to imagine skittle-shitting unicorns, a Star Trek replicator, or a fully functional 48" penis. 

Fri, 01/06/2012 - 00:47 | 2038100 prole
prole's picture

Oh the trees are running out!

\Oh the coal is running out!

Oh the oil is running out! We'll all freeze to death walking!!

Beam me up Scotty.......

Thu, 01/05/2012 - 19:23 | 2037413 Rusty.Shackleford
Rusty.Shackleford's picture

please look at graph of oil production, produced in reality over that same time period. you can cite all the new reserves you want, production has been flat since '05 and is entering decline. 

Thu, 01/05/2012 - 16:48 | 2036735 Canaduh
Canaduh's picture

Countless MAJOR oil fields?? Care to cite just a few?

Most oil is from plant matter and microscopic life in aquatic environments, not 'dinosaurs'.

And your last 2 sentences, wow.

Thu, 01/05/2012 - 17:27 | 2036917 Canaduh
Canaduh's picture

Adding the top-end estimates for all those gives 34.3 billion barrels.

The world consumes 88 million barrels per day, so that's 390 days worth. Not much, in other words.

 The chart at the bottom of the Norway article speaks volumes. All these new discoveries will only delay the inevitable by 10 or 20 years, at best.

Got more?

Thu, 01/05/2012 - 17:44 | 2037061 trav7777
trav7777's picture

No.  It delays nothing

Those fields will produce probably 500kbpd each.


Deepwater fields produce at fractions of the rate that can be sustained by surface fields of the same reserves class.  They peak sooner and decline faster.

The 34Bbbl found might at most give us 1.5 or 2 mbpd total.  They are not going to be producing like Cantarell or Prudhoe did.

Thu, 01/05/2012 - 19:34 | 2037447 torch bearer
torch bearer's picture


Thu, 01/05/2012 - 16:24 | 2036640 Rakshas
Rakshas's picture

Calling all NUMBNUTZES - if there be so much fucking oil to be had please let the good folks at the Oil Co's know so I don't have to have my ass go numb sitting in a fucking helicopter seat flying further and further offshore to drill more fucking holes in the ocean ........... YOU STUPID FUCKS.........


just sayin'.......

Thu, 01/05/2012 - 17:10 | 2036857 DCFusor
DCFusor's picture

+1 Rakshas.  The truth is always more complex than people re-spouting ditto head trash (spin funded by people who profit from your ignorance).

Here's a place where some real people who kinda do it for a living talk about it - yes, we find fields, some big.  Nothing like Saudi so far, though, and they are not making any more of it.

Some of the riggers there correctly predicted BP's top kill wasn't going to work and made me a lot of money going short over the labor day weekend awhile back.  Nothing like facts without politics for making basic action decisions.

Thu, 01/05/2012 - 17:09 | 2036840 Grinder74
Grinder74's picture

Obama takes a bath in it every day to wash away that "typical white woman" from his past.

Thu, 01/05/2012 - 22:15 | 2037770 Element
Element's picture

oil is finite because of it's biotic origin from dinosaur carcasses.


And which unbelievably stupid statement is stark and glaring evidence you have not the slightest grasp of the origins of oil as 'fossil fuel', and you should be totally ignored and discounted.

I don't know which is worse, that you have no clue at all, or that you have no clue ... that you have no clue.

I'm going with the latter.

Thu, 01/05/2012 - 16:21 | 2036613 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Only thing more stupid is the "peak oil" racket promoted by Al-Gore and other members of the power elite.


Economists from every major banking house use emponential reserves when calculating oil prices.  These banks run the power structure, and you think the ppnzi supports peak oil?  JFC!

Thu, 01/05/2012 - 16:56 | 2036790 RockyRacoon
RockyRacoon's picture

Mr. Smith seems to think that the U. S. does NOT want war.   How the hell else are we going to dig out of this hole that we vigorously dig deeper?  Like Wall Street doesn't make enough playing with the so-called price of oil?  Chuck should get real.   War is on the agenda, and TPTB say so.  QED

Thu, 01/05/2012 - 16:58 | 2036797 Kayman
Kayman's picture

The price of oil, like the price of money, has nothing to do with supply and demand.

It is whatever the tyrants want to set it at.

Thu, 01/05/2012 - 17:31 | 2036991 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Prices can be manipulated, but they are not determined.  The price of oil affects the dollar.  The dollar afects the euro.  Gold affects them all.  Supply/demand plays a role in this.  The PTB can stick their fingers in the dike, but the dam will explode.

Thu, 01/05/2012 - 16:18 | 2036614 Dr. Richard Head
Dr. Richard Head's picture

I take recent actions of fracking as desperation related to pinches in oil availability.  High-pressured brine injections into shale is now causing earthquakes in OK and OH, but the fracking continues either way.  How about US take cues from Canada and drill in the Great Lakes? 

Thu, 01/05/2012 - 16:34 | 2036680 Bob
Bob's picture

The fucking Great Lakes!

21% of the world's surface fresh water is in those lakes.  Fuck that.

I'm planning to drink that shit when TSHTF at TEOTWAWKI . . . just walk into the waves and drink. 

Leave the lakes alone. 

Bob In Michigan bitchez!

Thu, 01/05/2012 - 16:41 | 2036713 Dr. Richard Head
Dr. Richard Head's picture

I'm in Ohio right on the lake, so I understand exactly what you are saying.  That does not stop the Canadians though. Go just across the US border into Canada and see how many well heads are already there.  Hundreds in place right this second, fully operational.

Thu, 01/05/2012 - 16:57 | 2036752 Bob
Bob's picture

I had no idea.  I'll be taking it up with some Canadians this weekend, goddamn it. 

Imagine if you were in a state almost completely surrounded by that water.  True, that doesn't include Lake Erie, but I can get to Pt. Pelee in Ontario in an hour (somebody just asked me if I wanna go see the sunset there a couple of hours ago.) 

This is fucking up my day.  I usually envy the Canucks. 

But not this weekend.  Oh no. 

Edit: As I googlattacked this topic, I found no quick and easy data, but most of what I found said, in congruence with my previous assumption, that drilling is banned.  For example:

Got any links on those wells?

Thu, 01/05/2012 - 17:15 | 2036901 Dr. Richard Head
Dr. Richard Head's picture

I can't find one, but my boating chart has them all listed here.  I thouht directional drilling was the thing that was banned, butI don't know anymore. Here is some informationthat might be helpful on thatthough -

Approximately 2,200 vertical gas extraction wells have been drilled in Canada under Lake Erie since 1913, and 13 oil and gas wells have been drilled in Michigan under Lake Michigan and Lake Huron via horizontal drilling since 1979

From Wiki -

Great Lakes

The lakebeds under the US portion of the Great Lakes are owned by the adjacent states. The only state that has allowed oil and gas drilling beneath the Great Lakes in recent years has been Michigan, and that only by directional drilling from onshore surface locations. All oil and gas drilling, either on or directionally beneath the Great Lakes, has been banned by federal law since 2002.

The Canadian side of Lake Erie has 480 producing gas wells in the lake. Gas production in Canadian Lake Erie waters dates back to 1913; more than 2000 wells have been drilled to the Clinton Sand, up to a few miles from the US side of the lake; the same formation produces gas from many onshore wells on the US side, but there are no wells in the US portion of the lake.[17] The province of Ontario, where the offshore wells are located, allows gas wells, but not oil wells, in offshore Lake Erie.[18][19][20] Ontario allows oil production from below the lake only from wells drilled directionally from onshore surface locations; a number of such directional wells are producing oil from beneath Lake Erie in the Goldsmith/Lakeshore Field.[21]

A gas well to the Medina Group was drilled in 1958 in Pennsylvania state waters in Lake Erie.[22]

The only state that has current oil and gas production from beneath the Great Lakes is Michigan. Michigan has 13 oil and gas wells that produce from below Lake Michigan, all drilled directionally from surface locations on shore. Directional drilling beneath the Great Lakes is now banned.[23]

The US Geological Survey has estimated that 430,000,000 barrels (68,000,000 m3) of recoverable petroleum liquids and 5,200,000,000,000 cubic feet (150 km3) of recoverable natural gas underlie the US portion of the Great Lakes. Petroleum potential was given to all of the lakes except Lake Superior. The majority of the natural gas (3.0 TCF) is thought to underlie Lake Erie.[24]

Thu, 01/05/2012 - 17:51 | 2036956 Bob
Bob's picture

Directional drilling beneath the Great Lakes is now banned.

It sounds like the wells you speak of might be legacy wells grandfathered in from days of yore. 

Man, Erie got fucked up!  Wow. 

No wonder all those clean water fanatics I've dismissively crossed paths with over the past 30 years were so cranked up!  Now I'm glad for it. 

Fresh water will likely be more valuable than oil in the coming years (when production costs are considered.) 

It would be a stoooooopid capitalist indeed who fucked it up.  Or even let it happen. 

Thu, 01/05/2012 - 16:37 | 2036689 Piranhanoia
Piranhanoia's picture

Come on now, don't go off into fantasy land on us.

Thu, 01/05/2012 - 17:35 | 2037018 trav7777
trav7777's picture

Peak oil was invented by M. King Hubbert, you retarded fuck...a GEOLOGIST

Fri, 01/06/2012 - 01:21 | 2037923 Element
Element's picture

Exactly ... an oil exploration geo ... and the first time I heard Hubbert himself say this in the science.geo newsgroup, in mid-1999, I can assure you that almost no one in that professional geo newsgroup knew who he was, nor had heard of "peak oil".  Peak oil is in fact a new concept to the mainsteam geo community, and we all thought he must be wrong.  Only he's not. And that was really hard to accept, at the time, and that's why geo's generally weren't ready to accept it for a few years longer.  we argued intensively about it, but inevitably came to realise he's right.

(just look it up in the sci.geo newsgroup threads if you don't believe that's how general awareness of it came about, and the time-frame it occurred in)

But the almost totally ignorant public are now struggling with the reality of it as well, but fools keep coming out with this happy-crappy notion of a-biotic oil regeneration as saviour. 

I personally know (very closely) one of the geo's who has posited the potential in recent papers (during the past 5-years) for a-biotic oil generation deep in the earth.  And even if my friend got the geochemistry right, and developed a viable geo-mechanical emplacement mechanism, and even if it was all actually true and happening, the public still wouldn't understand that, it would be a very slow long-term process. 

And when a geo says 'long-term', they really aren't bullshitting about with the number of millions of years involved. Namely that the a-biotic oil debate, as saviour of the present society, is a complete farce, for even if it were occurring as a real process the trap repository regeneration would take place over millions of years. not over the next decade or five.

And this characteristic failure of non-geos to comprehend the scale, and proportions and time involved, is the reality these a-biotic-oil-as-saviour twats, can't cope with. 

They are simply deluded and they don't understand why that is, and judging by their statements and their dubious 'logic' I think it's safe to say that they don't want to understand it, either.

Fri, 01/06/2012 - 01:35 | 2038175 trav7777
trav7777's picture

fuckin I knew usenet was the shit, but didn't know it could function as a spirit medium. 

Hubbert died in 1989

Fri, 01/06/2012 - 03:06 | 2038277 Element
Element's picture

Damn ... my bad Trav ... my memory seems to be getting holes and ad-lib-ing missing bits;

But this is what I mean; this Aug 1999 post is basically how things got rolling RE the on-line mainstream geology peak-oil debate;

No one wanted to accept the basic premise or implications (and as you see everyone was tired of the tedius debunking of doomer claptrap and 'predictions') even within geology exploration circles (and especially within academia of course).

Everyone was quick to assume it was pure BS.

Thus the whole idea of peak-oil was largely an unfamiliar one to almost everyone, even in mid-1999, although the basic arguments were fully-formed back then, and remain valid to date.

Thu, 01/05/2012 - 15:35 | 2036417 GeneMarchbanks
GeneMarchbanks's picture

#1 for 2012 for sure.

Thu, 01/05/2012 - 15:36 | 2036420 kito
kito's picture

charles just jumped the shark..........

Thu, 01/05/2012 - 15:48 | 2036500 SheepDog-One
SheepDog-One's picture

Damn straight....what is this 'Post your most retarded disjointed nonsensical rambling article to Zerohedge' day? Charles...get a grip man.

Thu, 01/05/2012 - 16:20 | 2036624 Dr. Richard Head
Dr. Richard Head's picture

Get a grip indeed.  I am still trying to figure our how a trade war with China and Japan would drop oil prices to such ridiculously low levels.  There is an extreme disconnect there.  Maybe I missed it in the article?

Thu, 01/05/2012 - 16:28 | 2036654 mirac
mirac's picture total collapsed economy will get you $25.00 oil, and that's where we are heading

Thu, 01/05/2012 - 15:51 | 2036513 onelight
onelight's picture

It's what the US and the Saudis did some years back, to break the old USSR on the back of a drop to $10 Oil, for just long enough to make it work, and then back upward it went. Solidarity and the Pope's efforts were important but it was that deal with the Saudis that did it...

Thu, 01/05/2012 - 16:18 | 2036617 BennyBoy
BennyBoy's picture

Damn Right!

The plunge in oil back then broke the USSR's back.

Thu, 01/05/2012 - 17:47 | 2037077 trav7777
trav7777's picture

no; the USSR's oil production peaked in 1989.

Thu, 01/05/2012 - 16:23 | 2036634 tarsubil
tarsubil's picture

Now that article would have been interesting.

Thu, 01/05/2012 - 16:24 | 2036642 BoNeSxxx
BoNeSxxx's picture

Roger that...

If anything, we should be cheering for A-Daddy and Hugo.  The only two countries of any particular global relevance that have managed to ward off the UN/NWO and stop the globalists from stealing their oil, water, and mineral rights.

Sure, they aren't pretty but they are the only girls at this particular dance at present.


Thu, 01/05/2012 - 15:37 | 2036422 Ralph Spoilsport
Ralph Spoilsport's picture

Thanks Trav, I was wondering if somebody put something in my coffee after I read this.

Thu, 01/05/2012 - 16:06 | 2036573 trav7777
trav7777's picture

this may be my all-time PR for G/R arrow ratio

Thu, 01/05/2012 - 16:15 | 2036606 GeneMarchbanks
GeneMarchbanks's picture

Well deserved I might add, cause Smith had brain aneurysm while writing this or we just found the identity of the real MDB...

Thu, 01/05/2012 - 16:15 | 2036609 Ralph Spoilsport
Ralph Spoilsport's picture


Thu, 01/05/2012 - 16:51 | 2036759 Canaduh
Canaduh's picture

this may be my all-time PR for G/R arrow ratio

Is that what they base your pay on?

Thu, 01/05/2012 - 17:49 | 2037084 trav7777
trav7777's picture

good god, no, otherwise I'd be broke as fuck

Thu, 01/05/2012 - 15:40 | 2036433 Ghordius
Ghordius's picture

reminds me that the Tsars were right: if you have a serious problem in the country, start a war and your population will blame the enemy for all their problems

Thu, 01/05/2012 - 15:44 | 2036468 GeneMarchbanks
GeneMarchbanks's picture

A moment ago you were speechless? Whatever, CHS just redefined my econo-trader market perspective myopia thesis. It's no longer myopia it's a case of chronic cluelessness.

Thu, 01/05/2012 - 16:03 | 2036532 Ghordius
Ghordius's picture

well, it just jumped in my mind - can I give the green arrows back? I do somewhat prefer to have the better (if lone) opinion ;-)

CHS has a trading background, you know what is said about traders, they know every price but have no clue about values

so, now I feel better, pls arrow down

I agree with you with the chronic cluelessness and you know what?

this reminds me your Minsky Moment and how a young scientist (she was quite an eyesight, I had to concentrate hard) once explained to me that there are some moments where the cat in the box is both dead and alive - we are living through one of those

I don't blame traders - they get all their old signals, amplified and in both directions, no wonder some of them think that it's possible to get back to $25 or up to whatever by next week or so, they are just trying to work as they were used to

Thu, 01/05/2012 - 16:10 | 2036593 GeneMarchbanks
GeneMarchbanks's picture

Hot female scientists? In Europe? We clearly do not reside in the same European country.

Schrodinger's Cat is only a thought experiment and, if you ask me, demonstrates the lapse of physics into metaphysics, thereby explaining nothing at all.

Thu, 01/05/2012 - 16:16 | 2036612 Ahmeexnal
Ahmeexnal's picture

Some people consider Swinegela Merdekel to be a "hot european scientist" since she is a snake-oil physi-cist.

Thu, 01/05/2012 - 18:21 | 2037226 kaiserhoff
kaiserhoff's picture

Well said Gene.  I wondered if anyone else had noticed that an entire branch of physics and dozens of books have been based on  poorly understood wave interference of subatomic particles.  The simplest explanation might be:

1 Gee, we don't understand much of anything about subatomic particles.

2 There must be an infinite number of universes out there causing this interference.

Thu, 01/05/2012 - 18:46 | 2037312 Almost Solvent
Almost Solvent's picture

My eighth grade science teacher used a thought experiment to get across the mind numbing idea that is infinity (it's not a number):
Imagine everything in this universe is the same as it is at this moment; now imagine another universe where one blade of grass in your backyard is gone, everything else stays the same; now imagine another universe where a different blade of grass is gone, but everything else stays the same; continue until there's a different universe for each blade of grass on the planet, then cycle back and start changing something else, like a single hair on your head and repeat for every animal on the planet, and don't forget the atoms on this planet and every other planet and star and rock in the universe as well.

The staggering numbers quickly make it apparent that our human brains can't comprehend infinity on a real world basis.

Fri, 01/06/2012 - 01:38 | 2038180 trav7777
trav7777's picture

you should have bitchslapped him and said "stop dealing in the concrete like a cretin; abstractions are for geniuses"

Thu, 01/05/2012 - 15:44 | 2036466 Alien Invader
Alien Invader's picture

Wow i never realized that it was that easy to push oil back to $25/barrel - yeah, thanks dumbarse! I guess that's also what prevented the Dear Dead Leader from getting da bomb, oh wait he has it and he never had any oil. Come on TD don't start pimping out the good name of ZH with rubbish like this...

Thu, 01/05/2012 - 15:45 | 2036467 greyghost
greyghost's picture

oh holy shit!!!!! is this person utterly insane????? world wide depression????? another over educated moron. drop the price of oil to iran's production price of $25???? i remember a time when they sold their oil for $2 barrel, what was their production cost then?????? did this clown pull the $25 barrel price out of his ass? fuck it...lets drop the price back to $2 barrel!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

DOES ANYONE PREREAD ANY OF THIS FOOL'S CRAP before posting????????????????

Thu, 01/05/2012 - 15:51 | 2036514 SheepDog-One
SheepDog-One's picture

Yea it seems these 'economist' dudes are losing their damn minds....what is Saturn aligned with Jupiter or something? Weird.

Thu, 01/05/2012 - 15:45 | 2036480 Chief KnocAHoma
Chief KnocAHoma's picture

The overall premiss is acurate, but what collateral damage would be done in the process? This course might also take out the Saudis and it would certainly take a toll on Wall Street and the banking sector. Yes... they have loans out against reserves in the ground. If the collateral deflates... bye bye banks. Much like what is happening in real estate... we can only handle one cluster fuck at a time... but good of you to think out of the box.


Thu, 01/05/2012 - 15:53 | 2036523 SheepDog-One
SheepDog-One's picture

I could solve my sugar ant problem in my kitchen by filling my house with gasoline and torching it....makes as much sense as this article!

Nuke earth from orbit....its the only way to be sure....

Thu, 01/05/2012 - 15:56 | 2036537 Chief KnocAHoma
Chief KnocAHoma's picture

Again, I would suggest everyone read "The Next 100 Years". Whenever I feel a little angst I pick it up and recognize developments as they are framed in our Grand Strategy.

Basically, the US is on top, and will create chaos where ever we sense a threat. We would most likely stay on top via our geography anyway, but why risk it.

And don't think for one second ANY President could alter this course. Huesein most likely had to agree to continue this strategy before the CFR would allow him to be elected. His methods may be different - community organizing the ME Arab Spring and what not - but the results will be the same.

Thu, 01/05/2012 - 15:47 | 2036496 Toolshed
Toolshed's picture

No kidding. I guess the author thinks Exxon is run by a bunch of patriots that would happily watch their margins evaporate for the good of the USA. Get fukin real.

Thu, 01/05/2012 - 15:56 | 2036541 DevilsPrinciple
DevilsPrinciple's picture

The premise  of the article is easy to finesse y'all. Obama could merely nationalize the oil companies and set prices.

Think he wouldn't do it ? Think again. Think NDAA biotches.

Fri, 01/06/2012 - 03:12 | 2038298 Urban Redneck
Urban Redneck's picture

When has "nationalizing oil companies" ever lead to reduced global oil prices, outside of Maxine Waters' crack-ho-cranium?   

Thu, 01/05/2012 - 15:49 | 2036504 tmosley
tmosley's picture

Because we all know the price of oil only goes up.

Oil pumpers, bitchez.

Thu, 01/05/2012 - 16:07 | 2036579 trav7777
trav7777's picture

nobody said that and neither did the article.

you can only win an argument against nonexistent strawmen

Oil to "$60 by next week"

Thu, 01/05/2012 - 16:24 | 2036599 bob_dabolina
bob_dabolina's picture

I'll make a call here on gold. 

Gold 1900 by August 2012 

10yr T around the 119 space around the same time

Someone wright that shit down so when I'm right (again) BayOfPigs doesn't start running his fuckin' mouth again.

Thu, 01/05/2012 - 22:25 | 2037802 blunderdog
blunderdog's picture


I'll make a call here on gold.
Gold 1900 by August 2012
10yr T around the 119 space around the same time
Someone wright that shit down so when I'm right (again) BayOfPigs doesn't start running his fuckin' mouth again.

Thu, 01/05/2012 - 16:09 | 2036591 Eally Ucked
Eally Ucked's picture

He is from Two Minds and this time decided to use retarded one.

Thu, 01/05/2012 - 18:35 | 2037275 flattrader
flattrader's picture

I am a harsh critic of CHS...and I couldn't have done a better job myself.

I spit coffee.


Thu, 01/05/2012 - 16:11 | 2036596 Ben Chowd
Ben Chowd's picture

Well there was that post where the eurusd opend 9 pips lower and that earth shaking event made it as a post.

Thu, 01/05/2012 - 16:32 | 2036673 Iconoclast
Iconoclast's picture

Agreed to 100000000%..

Thu, 01/05/2012 - 16:39 | 2036696 qussl3
qussl3's picture

The Chinese will be laughing all the way to their SPR as the US drains theirs to play this stupid gambit.


Thu, 01/05/2012 - 16:55 | 2036755 vast-dom
vast-dom's picture

I have a strait in Hormuz for sale at a fantastic price!!!!


Maybe Graham Summer's $30/oz gold leprechaun's had a hand in this most inane guest post?

Thu, 01/05/2012 - 16:51 | 2036760 Judge Arrow
Judge Arrow's picture

To fulfill the premise of the scenario really takes nothing more than for everything to continue as it is going - why that is 'stupid' I have yet to see anyone post rationally here -  the plausibility of this scenario is very real and tongue in cheek presented here - the cooperation this would take at a conscious level is impossible - but no one has to force a recession/depression - it is in the works. Apparently seeing the outcome as destroying the weak, tyrannical regimes in Iran and Venezuela incites great hair pulling here - no need to get exercised - everyone will go down the drain - just some faster and further than others. Get used to  The New World Disorder (NWD).

Thu, 01/05/2012 - 18:14 | 2036965 cranky-old-geezer
cranky-old-geezer's picture




Agree fully.  Some of the dumbest bullshit on ZH in recent times.

Why do the Tylers allow this sort of pure crap on ZH?  Do these "contributors" pay money to post this bullshit?

Is that it?  Tylers will take any sort of nonsensical bullshit if it pays? Or controversial nonsensical crap that simply boosts traffic and comment counts?

Why the fuck does anyone want to "put Iran out of business"?

The whole premise is bullshit.  There's no need to "put Iran out of business".

It's not about "putting Iran out of business".  It's about taking control of Iran's oil ...just like Iraq, just like Lybia.

And no, China won't put up with it.   Iran is China's 3rd biggest oil supplier. 

America invades Iran and it'll start WWIII ...and it'll be thermonuclear, everybody pushing those buttons they've been itching to push for 50 years now.

And yes Russia will come in on China's side ...and Russia has the biggest baddest nuclear arsenal on this fucking planet ...and they've been wanting to use that massive nuclear arsenal on America a long fucking time, like 60 years now. 

Invading Iran will be America's death.  End of story.

So have at it Obama.  Preside over America's destruction.

Thu, 01/05/2012 - 19:53 | 2037489 DoChenRollingBearing
DoChenRollingBearing's picture

No land war in Iran.  It will not happen, no way.

Thu, 01/05/2012 - 17:38 | 2037027 omi
omi's picture


Thu, 01/05/2012 - 17:42 | 2037029 ObungaBoy
ObungaBoy's picture

Indeed !

Tyler definitely should take some break

The global recession will sweep out not just the Iran regime but Saudi Arabia’s satrap too along with U.S. and the whole world  

Thu, 01/05/2012 - 17:54 | 2037111 SteveNYC
SteveNYC's picture


Yes, let's make the country so poor the locals start to take up terrorism/human detonation as a new career choice.

Any country in the middle east would handle a "global depression" a heck of a lot better than ANY western country, USA being at/near the top of the list. Alas, our citizenry is not quite emotionally prepared to be introduced to real hardship yet.

Thu, 01/05/2012 - 20:43 | 2037606 bill1102inf
bill1102inf's picture

bullshit squared

Thu, 01/05/2012 - 18:20 | 2037218 DosZap
DosZap's picture

How do you drop oil to $25/barrel? Easy: stop saber-rattling in the mideast and engineer a massive global recession with a side order of low-level trade war


Far  easier way than that,stop ALL shipments of Iran's oil, and ALL their incomong shipments of EVERYTHING.

That way, Iran is the one that plays the one else.

Thu, 01/05/2012 - 19:48 | 2037479 Wu Qi Ming
Wu Qi Ming's picture

How is that I agree with Trav??? I feel dirty already ;)

Mon, 02/13/2012 - 17:44 | 2155270 combatsnoopy
combatsnoopy's picture

Instead of global depression, I prefer riding naked shorts all the way down.  Where's Soros when you need him.  Oh wait, it's on the other team.  Boo! 
I don't care what you think- I'm sick of these gas prices and the stupid depression.  

Thu, 01/05/2012 - 15:32 | 2036397 Jim in MN
Jim in MN's picture

Bullshit.  The devaluation of the dollar is the cause of the high price of oil.

Balance the Federal budget.  That'll drop the price of oil right quick.


Thu, 01/05/2012 - 15:38 | 2036432 Gene Parmesan
Gene Parmesan's picture

+1 for the bullshit call.

And all of this assumes that TPTB actually want to pressure Iran into some sort of non-violent resolution to the situation. WWIII would be a Keynesian's wet dream.

Thu, 01/05/2012 - 16:07 | 2036580 KickIce
KickIce's picture

I would agree that they want it, but I think they also realize that sky rocketing fuel prices would bring down what's left of the Ponzi.  Make no mistake about it, we'd be at war by now if they really thought they could while somehow continuing their illusion.

imo, that's their current dilemna.

Thu, 01/05/2012 - 16:12 | 2036601 Gene Parmesan
Gene Parmesan's picture

A global conflict would likely lead to fuel rationing anyway, and would in effect give governments the world over the green light to take over whatever industries they like in the interest of national security. At that point people are too distracted by the prospect of being bombed than they are with yelling and screaming for justice in the financial markets.

Thu, 01/05/2012 - 16:21 | 2036627 KickIce
KickIce's picture

I don't think that's their game plan, rationing and nationalizing wouldbe thought of as open tyranny.  That doesn't fit well in the current illusion.

Thu, 01/05/2012 - 17:05 | 2036826 Gene Parmesan
Gene Parmesan's picture

Maybe they see the current illusion as winding down...

Thu, 01/05/2012 - 15:46 | 2036482 KickIce
KickIce's picture

Yep, I can fill up my truck on $3 of real money, and that's even with the CBs monkey hammaring it to no end.

Thu, 01/05/2012 - 15:56 | 2036540 free_as_in_beer
free_as_in_beer's picture

I can't beleive you got this many +1's.

I guess we all forgot that banks print money, not the government?  A balanced fiat budget does nothing.

Thu, 01/05/2012 - 16:02 | 2036559 Jim in MN
Jim in MN's picture

I beg to differ.  Try it and see.  Our twin deficits--trade and fiscal--are mutually reinforcing.

Or does the whole Ben thing seem like 'not government' to you?

Thu, 01/05/2012 - 16:08 | 2036582 blunderdog
blunderdog's picture

The Fed's interests are only marginally aligned with the US government.  It's a bank, owned by other banks.  It's primary objective is the health of the US banking industry.

Thu, 01/05/2012 - 16:32 | 2036671 free_as_in_beer
free_as_in_beer's picture

What are you even talking about?

Your original post said that the dollar is devauled becasue the government doesn't have a blanced budget.  This is wrong, the dollar gets devalued becasue it is fiat based.  If the government stopped borrowing, the dollar would still get devalued.

For the dollar to stop devaluing in a fiat system, we would have to end debt completely.  Not just government debt.

Thu, 01/05/2012 - 17:14 | 2036896 Jim in MN
Jim in MN's picture

Yah OK there is a disconnect here--a fair argument--but I still hold that removing the deficit component of debt creation would go a long way toward slowing devaluation, and in terms of other currencies, i.e. the dollar index, USD would show great strength, as it did in the not-so-distant past.

Your strictly one-way logic (which runs the risk of being a red herring BTW) has no explanation for counter-trends.  But still a valid point, as far as it goes.  Relative devaluation vs. absolute devaluation is fun to debate while we plunge from the 110th floor, no?

Mon, 02/13/2012 - 17:53 | 2155318 combatsnoopy
combatsnoopy's picture

Value of a currency is determined by several factors, incl. Trade or Current account balance, federal balance, GDP, etc.  and whether or not it was tagged I mean pegged to another currency.

Right before the subprime collapse, the value of the USD was below the Canadian dollar.  Anyways, I would still love to buy naked shorts on the Petrodollar in the same way Soros shorted the Myanmar currency and the British pound.  

I dream about it, it makes me horny.  Trouble is that Soros is on the other team and I can't afford to buy off the regulators to allow that scheme.  

Thu, 01/05/2012 - 16:10 | 2036594 KickIce
KickIce's picture

Inflation, even on ZH.  I've heard Tyler gives some people the capabilty to vote more than once.  :)

Thu, 01/05/2012 - 15:58 | 2036548 The Heart
The Heart's picture

Yes...coming to a theater near you soon on a surprise Monday after maybe some special holiday weekend...some say it will be a 40% devaluation. many of you have noticed the new agenda 21 and obama care taxes on everything?

Thu, 01/05/2012 - 15:59 | 2036549 AGuy
AGuy's picture

In 1998 China was an Oil Exporter. By 2008 China has become the second largest importer of oil. <sarcasm>I am sure China has nothing to due with oil prices since it didn't impact global demand for Oil</sarcasm>Ditto for India which also more than tripled its oil imports.


Thu, 01/05/2012 - 16:05 | 2036568 Seer
Seer's picture

So, you don't believe in Supply and Demand?

That people are even thinking that PRICE is the concern are completely missing the boat.  If people are really poor they aren't going to be consuming oil in such quantities, in which case demand drops (along with price).  But, one problem here... economies of scale, w/o sufficient production levels you lose margin, UP go the prices and down go consumption- vicious cycle, downward (maybe Iran goes down, but so too will the US and others).

It's not all as simple as the simple-minded would like to believe.

Oh, and anyone thinking that oppressing living standards automatically results in the overthrow of a given regime, well, not exactly: when you've got a big imbalance those who HAVE have a lot more than the oppressed, a lot more to keep the oppressed oppressed.

Nice try all around... (sarcasm- everyone is failing to get a proper call on this)

All one needs to know is: 1) LESS and LESS oil will be exported; 2) The US WILL use all means necessary to get its "fix" (and help other western nations to do so as well); 3) Economies of scale will eventually run in reverse and collapse the entire oil-meme.

Fri, 01/06/2012 - 03:22 | 2038307 Urban Redneck
Urban Redneck's picture

Historically oppressing living standards in the US- falling domestic DEMAND for refied oil products, steady oil PRICE, increasing excess SUPPLY, resulting in increasing US exports of refined oil products... 

Thu, 01/05/2012 - 15:33 | 2036404 The trend is yo...
The trend is your friend's picture

Im sure XOM and BP will let that happen

Thu, 01/05/2012 - 15:43 | 2036461 Confused
Confused's picture

Perhaps a state of perpetual war is the goal, ala 1984?



Thu, 01/05/2012 - 15:46 | 2036486 john39
john39's picture

big brother reports intel to the effect that emmanuel goldstein is supplying nuclear weapons and other WMD's to various nations, starting with Syria and Iran.  

Thu, 01/05/2012 - 16:04 | 2036564 Confused
Confused's picture

Wars in far off lands, against shadowy opponents, and allies that are constantly switching sides. Doesn't sound like imminent danger of the world ending. But rather a group of powerful men more interested control.

Thu, 01/05/2012 - 16:07 | 2036581 Seer
Seer's picture

The REAL danger is when those "powerful men" find that they can no longer control.

Thu, 01/05/2012 - 15:52 | 2036518 Manthong
Manthong's picture

I'm all for the recession..

It's got to happpen for a day or two before the crash and chaos.

But $25.00 oil will knock the Saudi's and our other arab tyrant friends out of the saddle, too.

Thu, 01/05/2012 - 16:36 | 2036688 Iconoclast
Iconoclast's picture

We're in it already...have been for close on eleven years..

Thu, 01/05/2012 - 15:34 | 2036411 Camtender
Camtender's picture

and cure cancer at the same time..................

Thu, 01/05/2012 - 15:35 | 2036412 jcaz
jcaz's picture

Wow- nice to hear from someone who actually is aware of the facts regarding the supply of oil in this world.....

Cue the Greenpeace Al Gore disciples rebuttle.....

Thu, 01/05/2012 - 15:35 | 2036413 HL Shancken
HL Shancken's picture


FP: What would your advice be to the U.S. and to the West in general in terms of its policy toward Putin?

Stroilov: It is no good arguing if the Second Cold War is good or bad for us, for it has already started. What we should think about is how to win it as quickly and painlessly as possible.

In my view, it would be wise to set the following immediate objectives in your policy towards Putin (and his future successor):

1. Total isolation: throw him out of the G7, Council of Europe, WTO and wherever else you’ve made him a member or observer. Oddly enough, they are rather sensitive about such things. Cut the number and level of meetings with Russian officials, starting from summits and ministerial ones. The KGB people don’t see these meetings like you do: for them, every meeting is a stage in your virtual recruitment. They cannot be your partners, they can only be your case officers.

2. Support all those who are already fighting them, from democratic opposition inside Russia to those neighbouring countries, such as Georgia or East European states, which resist Kremlin’s pressure.

I even think it is time to establish relations, in an appropriate form, with the Chechen government-in-exile. I don’t think that you follow the Chechen politics very carefully, so perhaps your readers are unaware of the recent crisis, when Islamic fundamentalists unsuccessfully tried to take over the leadership of the Resistance. Instead, it resulted in the formation of Ahmed Zakayev’s government, which is pro-democracy, pro-independence, and has explicitly dissociated itself from the so-called jihadism. The West will hardly ever find a better kind of partners in the Muslim world.

If you support Zakayev, that would be a very strong blow on the Kremlin. In a situation when Putin covertly supports Al Qaeda, what could be a better response than demonstration of your solidarity with his own worst enemies, whom he slanders as terrorists, who represent the small nation suffering from FSB genocide, and who abide by the laws of war even in their desperate situation?

Besides, if you support a Muslim nation in its war against Kremlin’s tyranny, that may win you plenty of Muslim ‘hearts and minds’ elsewhere.

3. Do everything you can to make oil prices drop. Persuade the Saudis, develop your own oil production, do anything you can think of. Every dollar-per-barrel down means a blow on the KGB regime, and perhaps many human lives saved.

Thu, 01/05/2012 - 15:56 | 2036538 my puppy for prez
my puppy for prez's picture

"In a situation when Putin covertly supports Al Qaeda"

Got news for does the CIA!!!

Thu, 01/05/2012 - 15:35 | 2036414 SDRII
SDRII's picture

Drop the price of oil to $25 and Saudi Arabia implodes faster. Cold War retrograde


"Spending by the Kingdom of Saudi Arabia in 2012 will likely be higher than budgeted, but the country will still run a fiscal surplus of 4 percent of GDP, says Fitch Ratings.

Spending growth will moderate in 2012 compared with last year. In 2011, spending growth reached 24 percent, the highest in a decade. The government raised public sector wages, created government jobs, injected capital into state-owned lenders and pledged more resources for housing. Capital spending - mainly on infrastructure - exceeded 12 percent of GDP.

Saudi budgets typically underestimate both revenue and spending. In 2002-2011, central government spending exceeded the budget by an average of 24.8 percent. But in each year other than 2009, oil prices lifted revenues beyond expectations, giving the government room to spend more without running a deficit.

In its National Budget released December 26, the Ministry of Finance projected total revenues of SAR 702 billion ($187.2 billion) and government expenditure of SAR690 billion, giving a surplus of SAR12 billion."


Thu, 01/05/2012 - 16:01 | 2036556 sushi
sushi's picture

KSA requires an oil price of $70 bbl else it starts to implode.

In the early 1980s KSA had the spare capacity to flood the market and drive down the price of oil. This action hurt Houston as much as it hurt Moscow. But nobody paid any attention to the hurt given the oil sector. Folks were too happy filling up with cheap gas.

There is considerable doubt that KSA presently maintains similar spare capacity.

Thu, 01/05/2012 - 18:30 | 2037255 Seer
Seer's picture

"KSA requires an oil price of $70 bbl else it starts to implode."

Where does this come from?  I mean, if all import costs also dropped in lock-step would this still be a valid conclusion?

Thu, 01/05/2012 - 15:35 | 2036416 GeneMarchbanks
GeneMarchbanks's picture

And then you woke up?

Thu, 01/05/2012 - 15:36 | 2036418 xela2200
xela2200's picture

Does this article sound like a fairy tale or I am just going crazy? Maybe this is all a bad dream from that crappy big mac that I had last night. I knew it! All of the stupid things going on in the world cannot be real. I will wake up soon, and it will all be OK.

Thu, 01/05/2012 - 15:36 | 2036419 deKevelioc
deKevelioc's picture

Where does this author get off passing judgement on a country's 'theocracy' while the US sports an inverted totalitarian oligarchy?  Did this guy slip out from under a rock yesterday, missing the NDAA cerimony in Hawaii?  Go away, please.

Thu, 01/05/2012 - 15:40 | 2036443 dick cheneys ghost
dick cheneys ghost's picture


Thu, 01/05/2012 - 15:43 | 2036463 AnAnonymous
AnAnonymous's picture

He is a US citizen.

US citizens consider it a birth right to judge others 'societies by US standards and never get their US society judge by US standards.

Result: All other societies are failures by US standards, US never because never tested.

Do NOT follow this link or you will be banned from the site!