From: "Mark E. Hall" <markhall-AT-gol.com>
Subject: RE: liberation of iraq
Date: Tue, 28 Jan 2003 20:19:27 +0900




> I was at a seminar last night where Milan Rai, author of _War 
> Plan Iraq: 
> Ten Reasons against War on Iraq,_ was speaking.  His line on 

[snip since not relevant on the oil price issue]

> that the real 
> issue for the US in respect of oil is not oil supply but oil price,
which 
> needs to remain high to make US oil production profitable.  The US
control 
> of Iraqi oil, therefore would not necessarily be about stealing the
oil 
> from the French and the Russians (although I don't think this 
> can be ruled out and I think this explains French and Russian
hesitation 
> over the war to some extent) but about controlling the flow of oil in
the 
> interests of US economic stability and the profits of the oil industry
in the 
> US which is, un-coincidentally, heavily represented in the present US 
> administration.

But how does he do the math on that?  Right now Iraq produces
approximately 2-3 million barrels per day (depending on whose estimate
you look at); OPEC produces anywhere from 77-80 million per day; and
Russian production is at 12 million or so each day.  Controlling the
Iraq production isn't going to do much to the price of oil, and getting
the potential reserves there online are at best a 5 year, and in all
likelihood more like a 10-12 year project.  You can't build the wells,
the storage tanks, etc. that fast.   By 5 years from now, the Russians
or the Kazakhs will most likely be the biggest producers and the ones
able to control the market.  

And any price increases, short or long term, benefits the Russians and
the Russian oil companies.  

Best, MEH





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