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Ending America’s Disastrous Role in Syria

Delil Souleiman/AFP/Getty Images

Ending America’s Disastrous Role in Syria

America’s official narrative has sought to conceal the scale and calamitous consequences of US efforts to overthrow Syrian President Bashar al-Assad. That is understandable, because US efforts are in blatant violation of international law, which bars UN member states from supporting military action to overthrow other members’ governments.

NEW YORK – Much of the carnage that has ravaged Syria during the past seven years is due to the actions of the United States and its allies in the Middle East. Now, faced with an alarming risk of a renewed escalation of fighting, it’s time for the United Nations Security Council to step in to end the bloodshed, based on a new framework agreed by the Council’s permanent members.

Here are the basics. In 2011, in the context of the Arab Spring, the US government, in conjunction with the governments of Saudi Arabia, Qatar, Turkey, and Israel, decided to bring down Syrian President Bashar al-Assad’s regime, even though overthrowing another country’s government amounts to a blatant violation of international law. We know that in 2012, if not earlier, President Barack Obama authorized the CIA to work with America’s allies in providing support to rebel forces composed of disaffected Syrians as well as non-Syrian fighters. US policymakers evidently expected Assad to fall quickly, as had occurred with the governments of Tunisia and Egypt in the early months of the Arab Spring.

The Assad regime is led by the minority Alawi Shia sect in a country where Alawites account for just 10% of the population, Sunni Muslims account for 75%, Christians make up 10%, and 5% are others, including Druze. The regional powers behind Assad’s regime include Iran and Russia, which has a naval base on Syria’s Mediterranean coastline.

…click on the above link to read the rest of the article…

Saudi/Russia-Led Oil Supergroup In The Making

Saudi/Russia-Led Oil Supergroup In The Making

OPEC oil production

OPEC and the non-OPEC producers’ part of the production cuts deal will have a plan for long-term cooperation drafted by the end of 2018, as they seek to institutionalize their current collaboration into a supergroup of oil producers led by Saudi Arabia and Russia, the UAE’s Energy Minister Suhail Al Mazrouei told The National in an interview published on Thursday.

The producers aim “together with the secretary general [of OPEC, Mohammad Barkindo], to put together a draft agreement for this group [of 24] to stay together for a longer time”, Al Mazrouei said.

Putting together a draft charter and discussing it during the year is one of the UAE’s aspirations, said the minister whose country is currently holding OPEC’s presidency.

“If we achieve the market balance, I think we can see significant amount of investments coming to the E&P business and we can see that many of the 24 countries who have signed the Declaration of Cooperation can benefit from it,” Al Mazrouei told The National.

The idea to follow up on the current OPEC/non-OPEC cooperation came originally from OPEC’s Secretary General Mohammad Barkindo, who said as early as in October last year that the partnership could be institutionalized.

Last month, Khalid al-Falih, the energy minister of OPEC’s de facto leader and largest producer Saudi Arabia, said that “There is a readiness to continue cooperation beyond 2018…The mechanism hasn’t been determined yet, but there is a consensus to continue.”

Al-Falih, as well as Russia’s Energy Minister Alexander Novak, has hinted several times that the cooperation could continue in some form—although not necessarily in oil market management—even after the end of 2018, when the current pact to curtail oil production expires.

In an interview with S&P Global Platts published earlier this week, Novak said that Russia wanted to build a long-term relationship with Saudi Arabia and the broad OPEC alliance once their agreement expires.

Saudi Arabia, Russia Ink 3 Huge Energy Deals

Saudi Arabia, Russia Ink 3 Huge Energy Deals

Saudi Arabia

Saudi Arabia hits bullseye, IPO and LNG deals cements geopolitical cooperation Russia

Hidden by the fog of the ongoing oil market volatility and the Turkish adventures in Syria, OPEC leader Saudi Arabia has been cementing its geopolitical position for years. In Riyadh meetings this week between Saudi and Russian officials, major energy deals were sealed, changing the regional constellation dramatically. At the same time, the geopolitical shift of the century now starts to bear fruit.

Russia has directly offered to invest in the upcoming Aramco IPO, supporting the efforts of Saudi Crown Prince Mohammed bin Salman (MBS) to diversify the economy of the kingdom. During the meetings, not only new Saudi investment deals in Russia were sealed, but also the commitment of several Russian investment parties in the Aramco IPO.

After weeks of receiving a hell of a beating in the press (analysts started to doubt that it would ever happen), not only positive news has come from the NYSE and LSE, but also — as expected — from Russian institutions.

Kirill Dmitriev, CEO of the main Russian sovereign wealth fund, Russian Direct Investment Fund (RDIF), stated in Riyadh that he expects that a Russian and Chinese joint investment fund, working in conjunction with several major Russian banks, will be part of the Aramco IPO. He also indicated that other Russian financial institutions and investors are very interested to take a part of the 5 percent of Aramco being offered in the IPO.

These statements are a significant boost for MBS and his IPO advisors, as the participation of a Russia-China investment fund also shows the interest of Chinese parties in the stakes. While Chinese parties are expected to be willing to hand over tens of billions, Dmitriev’s statements have widened the scope.

…click on the above link to read the rest of the article…

Future U.S. Oil Production Will Collapse Just As Quickly As It Increased

Future U.S. Oil Production Will Collapse Just As Quickly As It Increased

While U.S. oil production reached a new peak of 10.25 million barrels per day, the higher it goes, the more breathtaking will be the inevitable collapse.  Thus, as the mainstream media touts the glorious new record in U.S. production that has both surpassed its previous peak in 1970 and Saudi Arabia’s current oil production, it’s a bittersweet victory.

Why?  There are two critical reasons the current record level of U.S. oil production won’t last and is also, a house of cards.  First of all, oil production profiles tend to be somewhat symmetrical.  They rise and fall in the same manner.  While this doesn’t happen in every country or every oil field, we do see similar patterns.  For example, this similar trend is taking place in both Argentina and Norway:

Here we can see that oil production increased, peaked and declined in a similar pattern in both Argentina and Norway.  However, many countries had their domestic oil industries impacted by wars, geopolitical events, and or enhanced oil recovery techniques that have resulted in altered production profiles.  Regardless, the United States experienced a symmetrical oil production profile from 1930 to 2007:

As we can see in the chart, U.S. oil production from 1930 to 2007 increased and then declined in the same fashion.  On the other hand, the new Shale Oil Production trend is much different.  What took 23 years for U.S. oil production to double from 5 million barrels per day (mbd) in 1947 to a peak of nearly 10 mbd in 1970, was accomplished in less than a decade with the new shale oil industry.  Total U.S. oil production doubled from 5 mbd in 2009 to over 10 mbd currently.

…click on the above link to read the rest of the article…

The Abnormality of Oil

Oil barrelsAhmad Al-Rubaye/Getty Image

The Abnormality of Oil

At the 2017 Abu Dhabi Petroleum Exhibition and Conference, the consensus among industry executives was that oil prices will still be around $60 per barrel in November 2018. But there is evidence to suggest that the uptick in global growth and developments in Saudi Arabia will push the price as high as $80 in the meantime.

LONDON – Writing about oil prices is always risky. In a January 2015, I suggested that oil prices would not continue to fall, and even predicted that they would “finish the year higher than they were when it began.” I was wrong then; but I might not be wrong for much longer.

I recently spoke at the massive Abu Dhabi Petroleum Exhibition and Conference (ADIPEC), which is a kind of Davos for oil-market participants. While there, I caught the tail end of a discussion among senior oil executives who all agreed that at this time next year, crude oil will still be around $60 per barrel, as it is today.

I was about to be interviewed by the CNBC reporter Steve Sedgwick, to whom I said, “That would be a first. Oil prices hardly moving in a year?” Needless to say, Sedgwick began the interview by telling the audience what I had said, and quizzed me on why I disagreed with the others.

Before I get to my explanation, let me state the usual caveats. Forecasting oil prices is inevitably a fraught endeavor; in fact, it makes forecasting currency markets look easy. When I completed a doctorate on oil markets in the late 1970s and early 1980s, I had already concluded that trying to guess oil prices is a waste of time and energy. Later, when I was at Goldman Sachs, I was often amused to see commodity analysts in my research group struggling to cope with the usual chaos of oil-price developments.

…click on the above link to read the rest of the article…

Gasoline–Such a Big Bang for the Buck

Gasoline–Such a Big Bang for the Buck

Are you a fan of beheadings? Are you fond of autocratic regimes? Do you want to help those kooky, lovable Koch brothers purchase another member of Congress? Do you yearn to support Saudi Arabia, Iran, Donald Trump, and Vladimir Putin, but it seems so difficult to give them direct, individual donations? Lucky for you, there’s an easy answer! Just buy gasoline!

Yes, it’s that simple. Oil is a worldwide commodity. Any gallon you purchase props up the price as a whole, enriching international oil companies and oil-exporting nations, with a handsome portion trickling to the politicians they’ve bought. (Oops, “support.”) Your money is guaranteed to enable stonings of adulterous women and beheadings of political prisoners, not to mention facilitate juicy environmental damage from oil spills and toxic fracking waste. In fact, you can rest easy knowing that every dollar you spend on gasoline works hard to attack human rights, cripple the environment and enable political corruption. A three-fer!

But there’s more! On a local level, the gasoline you burn has the happy side benefit of inflicting asthma and cancer on the poorest in your region since it’s the poorest who live along freeways and traffic sewers where tailpipe emissions are highest and the rent is cheapest.

 
Make them richer and more powerful! It’s easy!

As a bonus, it’s easy to double the impact of your gasoline purchase by doing your best to make miserable the lives of anyone traveling without a car. With a little persistence, you can force them to get their own car and buy gasoline just like you. So honk at bicyclists as you pass them. Rev your motor loudly to show them who’s boss. Don’t stop for pedestrians in crosswalks.

…click on the above link to read the rest of the article…

How regional rivalries threaten to fuel the fire in Syria and Iran

Credit: Wikimedia 

Turkish allegations of Saudi, Emirati and Egyptian support for the outlawed Kurdish Workers Party (PKK) threaten to turn Turkey’s military offensive against Syrian Kurds aligned with the PKK into a regional imbroglio.

The threat is magnified by Iranian assertions that low-intensity warfare is heating up in areas of the Islamic republic populated by ethnic minorities, including the Kurds in the northwest and the Baloch on the border with Pakistan.

Taken together, the two developments raise the spectre of a potentially debilitating escalation of the rivalry between Saudi Arabia and Iran as well as an aggravation of the eight-month-old Gulf crisis that has pitted Saudi Arabia and its allies against Qatar, which has forged close ties to Turkey.

The United Arab Emirates and Egypt rather than Saudi Arabia have taken the lead in criticizing Turkey’s incursion into Syria designed to remove US-backed Kurds from the countries’ border and create a 30-kilometer deep buffer zone.

UAE Minister of State for Foreign Affairs Anwar Gargash said the incursion by a non-Arab state signalled that Arab states would be marginalized if they failed to develop a national security strategy.

Egypt, for its part, condemned the incursion as a “fresh violation of Syrian sovereignty” that was intended to “undermine the existing efforts for political solutions and counter-terrorism efforts in Syria,”

Despite Saudi silence, Yeni Safak, a newspaper closely aligned with President Recep Tayyip Erdogan’s ruling Justice and Development Party (AKP), charged that a $1 billion Saudi contribution to the reconstruction of Raqqa, the now Syrian Kurdish-controlled former capital of the Islamic State, was evidence of the kingdom’s involvement in what it termed a “dirty game.”

…click on the above link to read the rest of the article…

Art Berman: Like It Or Not, The Future Remains All About Oil

Vladimir Yudin | Dreamstime.com

Art Berman: Like It Or Not, The Future Remains All About Oil

And competition for it is heating up 

Art Berman, 40-year veteran in the petroleum production industry and respected geological consultant, returns to the podcast this week to talk about oil.

After the price of oil fell from its previous $100+/bbl highs to under $30/bbl in 2015, many declared dead the concerns raised by peak oil theorists. Headlines selling the “shale miracle” have sought to convince us that the US will one day eclipse Saudi Arabia in oil production. In short: cheap, plentiful oil is here to stay.

How likely is this?

Not at all, warns Berman. World demand for oil shows no signs of abating while the outlook for future production looks increasingly scant. And the competition among nations for this “master resource” will be much more intense in future decades than we’ve been used to:

Since the 1980s, we simply have not been replacing reserves with new discoveries. So how does that work? Well, obviously, we’ve got a lot of oil on production and in reserves, so we’re essentially drawing down our savings account if you want to think about it that way. You can do that for a long time if you’ve got a whole lot of money in your savings account, and we as a planet do. But you can’t do it forever.

Eventually, you either have to stop spending as much so you don’t draw down your savings, or you need to put some money back in the account. And it doesn’t seem like we’re doing much of either, and haven’t been doing much of either for a long time. So the concern is tremendous, at least, in my estimation(…)

…click on the above link to read the rest of the article…

Fabricating a War on Iran

Fabricating a War on Iran

Photo by futureatlas.com | CC BY 2.0

Secretary of State Colin Powell brandished a vial he claimed contained anthrax at the UN Security Council on 5 February 2003, and showed satellite photos of secret sites where chemical weapons were supposed to be manufactured. He later admitted the story was fabricated, but not before it had served as a PR launch pad for the Iraq war.

On 11 December 2017 the US ambassador to the UN, Nikki Haley, appeared with huge fragments of what she claimed was an Iranian missile that had missed its target. She maintained it had been fired from Yemen at a Saudi civil airport, ‘a G20 country’ and had ‘the potential to kill hundreds of innocent civilians in Saudi Arabia … Just imagine if this missile had been launched at Dulles Airport or JFK. Or the airport in Paris, London or Berlin.’

Never mind it could not have travelled that far. Once again, fear is being manufactured to justify war: 14 years after destroying Iraq, the US government has Iran in its sights.

Haley’s lack of imagination might be entertaining were the subject not so serious. In 2003 Powell criticised the existence of ‘sinister’ links between Saddam Hussein and Al-Qaida. This was replayed on 1 November 2017: the CIA published a cache of documents seized in Pakistan when Osama bin Laden was assassinated, supposed to prove the existence of improbable links between some of Bin Laden’s successors and Iran’s (Shia) leadership.

It’s as if Washington has already forgotten the support – real, not alleged – it gave Bin Laden when he fought the Soviets in Afghanistan, or Ronald Reagan’s illegal arms sales to Iran when he sought funding for his far-right friends in Nicaragua.

…click on the above link to read the rest of the article…

Eleven Saudi Royals Arrested For Protesting Against Austerity

Members of Saudi Arabia’s royal family have apparently learned nothing from their cousin’s authoritarian tendencies. To wit, Saudi authorities on Saturday detained 11 princes after they gathered at a royal palace in Riyadh to protest austerity measures imposed by their cousin and the state’s de facto leader: Crown Prince Mohammad bin Salman, aka MbS.

Saudi

Crown Prince Mohammad bin Salman

As part of the latest wave of cutbacks forced by still-low oil prices, bin Salman suspended payment of royals’ utility bills. The decision triggered a backlash among the royals who weren’t prosecuted during the Crown Prince’s “corruption crackdown”/cash grab from late last year, and they swiftly assembled at the Qasr a-Hokm, a historic royal palace, to demand the cancellation of a royal decree that stopped state payment of water and electricity bills for royal family members. The move was a rare act of defiance against the Saudi crown, per Reuters. They were also demanding compensation for a death sentence issued against a relative, local media  reported.

In light of recent “events” in Saudi Arabia, it was a rather poor decision.

The identities of the princes taken into custody have not been released. However, the leader of the group has been identified by the initials S.A.S.”Everybody is equal before the law and anyone who does not implement regulations and instructions will be held accountable, no matter who he is,” a local media website added.

Late last year, MbS imprisoned dozens of royals at the Riyadh Ritz Carlton until they agreed to fork over substantial chunks of their wealth in exchange for their freedom. The shakedown resulted in one former general being tortured to death after refusing to give in to MbS’s remunerative demands – the princes spoke up, and were promptly taken into custody.

…click on the above link to read the rest of the article…

Who Are the Leading State Sponsors of Terrorism?

Who Are the Leading State Sponsors of Terrorism?

Who Are the Leading State Sponsors of Terrorism?

As 2017 draws to a close, it is difficult to be optimistic about what will be coming in the new year. The American President, whose margin of victory was certainly based on his pledge to avoid unnecessary wars, has doubled down on Afghanistan, refuses to leave Syria even though ISIS has been defeated, and is playing serious brinksmanship with a psychopathic and unpredictable regime in Pyongyang. The White House has also bought into the prevailing largely fabricated narrative about a Russia and has decided to arm Ukraine with offensive weapons, which has already resulted in a sharp response from Moscow and will make détente of any kind between the two leading powers all but impossible in the upcoming year.

But, as I have observed before, the red hazard light that continues to be blinking most brightly relates to Washington’s relationship with Iran, which has unnecessarily deteriorated dramatically over the past year and which brings with it collateral problems with Russia and Turkey that could trigger a much wider conflict. I say unnecessarily because all the steps taken to poison the relationship have come out of Washington, not Tehran. The Trump administration refused to certify that the Iranians had been in compliance with the nuclear agreement negotiated in 2015 and has since escalated its verbal attacks, mostly at the United Nations, claiming that the regime in Tehran is the major source of terrorism in the world and that it is seeking hegemony over a broad arc of countries running westward from its borders to the Mediterranean Sea.

…click on the above link to read the rest of the article…

2017 Year In Review

Tortoon/Shutterstock

2017 Year In Review

Markets fiddle while Rome burns

Every year, friend-of-the-site David Collum writes a detailed “Year in Review” synopsis full of keen perspective and plenty of wit. This year’s is no exception. As with past years, he has graciously selected PeakProsperity.com as the site where it will be published in full. It’s quite longer than our usual posts, but worth the time to read in full. A downloadable pdf of the full article is available here, for those who prefer to do their power-reading offline. — cheers, Adam

Introduction

“He is funnier than you are.”

~David Einhorn, Greenlight Capital, on Dave Barry’s Year in Review

Every December, I write a survey trying to capture the year’s prevailing themes. I appear to have stiff competition—the likes of Dave Barry on one extreme1 and on the other, Pornhub’s marvelous annual climax that probes deeply personal preferences in the world’s favorite pastime.2 (I know when I’m licked.) My efforts began as a few paragraphs discussing the markets on Doug Noland’s bear chat board and monotonically expanded to a tome covering the orb we call Earth. It posts at Peak Prosperity, reposts at ZeroHedge, and then fans out from there. Bearishness and right-leaning libertarianism shine through as I spelunk the Internet for human folly to couch in snarky prose while trying to avoid the “expensive laugh” (too much setup).3 I rely on quotes to let others do the intellectual heavy lifting.

“Consider adding more of your own thinking and judgment to the mix . . . most folks are familiar with general facts but are unable to process them into a coherent and actionable framework.”

~Tony Deden, founder of Edelweiss Holdings, on his second read through my 2016 Year in Review

“Just the facts, ma’am.”

~Joe Friday

…click on the above link to read the rest of the article…

Saudi airstrikes kill 48 Yemeni civilians in 24 hours

BEIRUT, LEBANON (5:40 P.M.) – At least 48 Yemeni civilians have been killed by the Saudi Coalition in the last 24 hours, the Saba News Agency reported.

“A total of 48 civilians, including women and children, were killed and wounded in 51 airstrikes launched by US-backed Saudi-led aggression coalition using internationally banned weapons on several Yemeni provinces over the past few hours, military and security officials told Saba on Sunday,” the news agency reported.

The Saudi airstrikes were primarily concentrated on the northern part of the country, where the Houthis is currently controls several provinces.

In addition to northern Yemen, the Saudi airstrikes were also targeted the western part of the country, including the Hodeidah Port that was finally reopened after it was blockaded for several weeks.

Saudis Intercept Houthi Ballistic Missile Targeting Riyadh Royal Palace

Saudis Intercept Houthi Ballistic Missile Targeting Riyadh Royal Palace

For the third time in roughly seven weeks, Houthi rebels have fired a ballistic missile into Saudi Arabia, according to a spokesperson. This time, the target was al-Yamamah palace in the Saudi capital, Riyadh.

US President Donald Trump notably held meetings with the Saudi king at the al-Yamamah palace during his May trip to the kingdom.

Witnesses in Riyadh reported hearing a blast and seeing a plume of smoke. Saudi security officials did not immediately comment on the incident, according to Haaretz.

Houthis launched two ballistic missiles at Saudi Arabia in November, but neither hit their targets. One was reportedly fired at King Khalid International Airport in Riyadh while the other was fired at a Saudi oil refinery.

According to Russia Today, the Saudi-led coalition that has been battling the rebels in Yemen has reportedly shot down the missile, according to Russia Today.

Saudi state TV claimed the missile – a Burkan 2H ballistic missile – was intercepted by Saudi defenses…


Reports of a ballistic missile just intercepted over Riyadh


There were no immediate reports of injuries and there has been no official statement from the Saudi government. However, a Houthi rebel spokesman on Twitter confirmed the missile launch.

The Great Oil Swindle

silentera.com

The Great Oil Swindle

Is leading us to destruction

When it comes to the story we’re being told about America’s rosy oil prospects, we’re being swindled.

At its core, the swindle is this: The shale industry’s oil production forecasts are vastly overstated.

Swindle:  Noun  – A fraudulent scheme or action.

And the swindle is not just affecting the US.  It’s badly distorted everything from current geopolitics to future oil forecasts.

The false conclusions the world is drawing as a result of the self-deception and outright lies we’re being told is putting our future prosperity in major jeopardy. Policy makers and ordinary citizens alike have been misled, and everyone — everyone — is unprepared for the inevitable and massive coming oil price shock.

An Oil Price Spike Would Burst The ‘Everything Bubble’

Our thesis at Peak Prosperity is that the world’s equity and bond markets are enormous financial bubbles in search of a pin. Sadly, history shows there’s nothing quite as sharp and terminal to these sorts of bubbles as a rapid spike in the price of oil.

And we see a huge price spike on the way.

As a reminder, bubbles exist when asset prices rise beyond what incomes can sustain.  Greece is a prime recent example. In 2008 when the price of oil spiked to  $147/bbl, Greece could no longer afford imported oil. But oil is a necessity so it was bought anyway, their national balances of payments were stressed to the point that they were exposed as insolvent and then their debt bubble promptly and predictably popped.   The rest is history.  Greece is now a nation of ruins and their economy might as well be displayed alongside the Acropolis.

…click on the above link to read the rest of the article…

Olduvai II: Exodus
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Olduvai II: Exodus
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Olduvai III: Cataclysm
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