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Oil will go up ‘ballistically’ if unrest shifts to Saudi Arabia, says Marc Faber
INTERNATIONAL. Marc Faber the Swiss fund manager and Gloom Boom & Doom editor sees oil prices extending their bull run despite the 15% run-up this year alone.
In an optimistic scenario demand for oil will rise as the global recovery takes hold, and in a pessimistic scenario prices still go up if the Middle East unrest spreads and crude production is curtailed. In both cases, he says, you should be long energy and energy related shares.
Speaking to CNBC today, Faber said: ” I think long term you should be exposed to energy in either scenario….if you are extra bearish and believe that War World III is going to start soon, as I believe, or in an optimistic scenario”.
Addressing the fundamentals of the oil market, Faber said: “What we had over the last couple of years is essentially a reduction in demand from the developed world, the US, Western Europe and Japan, and continued growth in emerging economies.
“So, if you take a very optimistic view of the world, namely a global economic recovery, demand in the Western World will pick up and demand in the Emerging World will continue to rise strongly, so from a very optimistic point of view you should be long oil,” he recommended.
On the flip side, “in a very pessimistic scenario you have to assume that unrest will shift to Saudi Arabia and other countries in the gulf and at that stage the production is curtailed and in that case obviously oil will go up ballistically.”
Brent crude futures could hit US$200 a barrel if political unrest spreads into Saudi Arabia, Societe Generale said on Monday.
Under what the bank called Geopolitical Scenario 3, “unrest spreads to Read more…
Turkmenistan to boost gas deliveries to China
AP
ASHGABAT, Turkmenistan (AP) — Energy-hungry China is set to sign an agreement with the Central Asian nation of Turkmenistan later this year to boost its future annual natural gas purchases by 20 billion cubic meters, state newspaper Neutral Turkmenistan reported Wednesday.
The deal means Turkmenistan’s annual gas sales to China will eventually reach 60 billion cubic meters — equivalent to more than half China’s entire natural gas consumption last year.
Turkmenistan began delivering gas to China through a newly completed pipeline in late 2009, but that route is only expected to reach full annual capacity of 40 billion cubic meters by 2015. As of mid-February, Turkmenistan had supplied 5.8 billion cubic meters of Read more…
Middle East Meltdown Could Mean Oil at $300 a Barrel, Pump Prices of $9.57 a Gallon
moneymorning.com [Editor’s Note: U.S. oil prices yesterday (Tuesday) hit their highest levels since September 2008 as investors reacted to fears that Middle East tumult would spread from Libya to such key Organization of Petroleum Exporting Countries (OPEC) as Iran and Saudi Arabia. But never fear: Even if the Middle East melts down and oil prices soar, there are moves you can make to hedge away your risk. We have two suggestions for you here.] By Martin Hutchinson, Contributing Editor, Money Morning The unrest in the Middle East oil patch is roiling the global oil markets on an almost daily basis. 
The events in Egypt, Libya, Saudi Arabia, Oman and other countries are also forcing us to ask that long-dreaded question: What happens if the countries throughout the Middle East region fall to radical governments? The answer is both stunning and surprising. In an absolute worst-case scenario – if the entire Middle East falls under radical control – we could be looking at $300-a-barrel oil and pump prices of $9.57 a gallon. Definitely a stunner. Here’s the surprise: Even such a worst-case outcome would Read more…
Need Versus Greed
NEW YORK – India’s great moral leader Mohandas Gandhi famously said that there is enough on Earth for everybody’s need, but not enough for everybody’s greed. Today, Gandhi’s insight is being put to the test as never before.
The world is hitting global limits in its use of resources. We are feeling the shocks each day in catastrophic floods, droughts, and storms – and in the resulting surge in prices in the marketplace. Our fate now depends on whether we cooperate or fall victim to self-defeating greed.
The limits to the global economy are new, resulting from the unprecedented size of the world’s population and the unprecedented spread of economic growth to nearly the entire world. There are now seven billion people on the planet, compared to just three billion a half-century ago. Today, average per capita income is $10,000, with the rich world averaging around $40,000 and the developing world around $4,000. That means that the world economy is now producing around $70 trillion in total annual output, compared to around $10 trillion in 1960.
China’s economy is growing at around 10% annually. India’s is growing at Read more…
After the ecstasy of revolution, the Bankers quietly begin carving up Egypt and North Africa
By Richard Eastman
21st Century Wire
Feb 25, 2011
The European Bank for Reconstruction and Development (EBRD) is ready to lend one billion EUROS a year to Egypt for reconstruction and “free-market reform”- even as Egypt’s Minister of Finance Samir Radwan has gone begging to the City of London bankers and the British Ministry of Trade and Investment for relief on debt payments that are about to throw Egypt into bankruptcy.
All this, as Egypt has been such a good boy with regards to privatization and austerity, measures which awarded Egypt its celebrated 7 percent growth rate- mostly in investments that will end up in international hands as ventures fail to pay out with ever diminishing Egyptian domestic purchasing power.
FRESH CYCLES OF DEBT
First EBRD will lend at interest and build what they want backed by Egyptian collateral and the value of the projects themselves. Then when it turns out they can’t make the debt payments because of all the interest we have sucked from them, we take over all of the assets we have developed. That’s freedom and EBRD is really going to give it to them. After all EBRD is experienced at this. In 1991 the EBRD was organized to financially lead Russia and Eastern Europe in their transition from paternalistic socialism to sustainable free-market economies open to international Read more…
Robert Kaplan on the New New Great Game
The U.S. can maintain its global primacy if it (among other things) plays Russia off China, India, Iran and Turkey off Russia and Turkey off Iran. That’s the analysis of globe-spinner extraordinaire Robert Kaplan, along with his brother Stephen (apparently recently retired as a top CIA official).
The essay, America Primed, is in the new edition of The National Interest and doesn’t deal too explicitly with the Caucasus or Central Asia. But it’s all about how the U.S. (assisted by the “Anglosphere,” other English-speaking countries like Canada, the U.K. and Australia) can maintain dominance on the Eurasian continent. And that requires American leadership to make sure that no other country — in particular China, Russia or Iran — gets too powerful. What does that entail, specifically?
For one, playing India off Russia (and “punishing” Pakistan):
Out of national pride, and because of its own tense relationships with China and Pakistan, India needs to remain officially nonaligned. But that will not stop New Delhi from accepting more help from Read more…
Limited Nuclear War Could Deplete Ozone Layer, Increasing Radiation
By Chris Schneidmiller
WASHINGTON — A nuclear conflict involving as few as 100 weapons could produce long-term damage to the ozone layer, enabling higher than “extreme” levels of ultraviolet radiation to reach the Earth’s surface, new research indicates (see GSN, March 16, 2010).
(Feb. 24) – A 1971 French nuclear test at Mururoa Atoll. The ozone layer could sustain lasting harm from a nuclear exchange involving as few as 100 weapons, allowing increased levels of ultraviolet radiation to reach the Earth’s surface, according to new research (Getty Images).
Increased levels of UV radiation from the sun could persist for years, possibly with a drastic impact on humans and the environment, even thousands of miles from the area of the nuclear conflict.
“A regional nuclear exchange of 100 15-kiloton weapons … would produce unprecedented low-ozone columns over populated areas in conjunction with the coldest surface temperatures experienced in the last 1,000 years, and would likely result in a global nuclear famine,” according to a presentation delivered on Friday at a major science conference in Washington.
Today, there are five recognized nuclear powers — China, France, Russia, the United Kingdom and the United States. India, Israel and Pakistan are all known or widely assumed to hold nuclear weapons, while North Korea has a Read more…
Thousands in India protest increasing food prices
NEW DELHI — Tens of thousands of trade unionists, including those from a group linked to India’s ruling party, marched through the streets of the capital on Wednesday to protest food prices, piling pressure on a government already under fire over graft. The demonstration in New Delhi was the latest in a wave of protests sweeping across the world, including the Middle East and Africa, ignited by a worldwide spike in food prices.
India, Asia’s third-largest economy and home to more than a billion people, has been grappling with double-digit food inflation. Hundreds of millions of poor have been hit the hardest.
In one of the largest anti-government protests in New Delhi in recent years, at least 50,000 people representing trade unions from the country’s political parties marched through the center of the capital towards the parliament building. In a sea of red flags and hats bearing their union name, protesters chanted Read more…
Control over your food: Why Monsanto’s GM seeds are undemocratic
Large biotech agribusinesses like Monsanto control much of the global seed market with genetically modified (GM) crops. This centralization of GM seeds threatens food safety, food security, biodiversity, and democratic ideals.
By Christopher D. Cook / February 23, 2011
Question: Would you want a small handful of government officials controlling America’s entire food supply, all its seeds and harvests?
I suspect most would scream, “No way!”
Yet, while America seems allergic to public servants – with no profit motive in mind – controlling anything these days, a knee-jerk faith in the “free market” has led to overwhelming centralized control of nearly all our food stuffs, from farm to fork.
The Obama administration’s recent decision to radically expand genetically modified (GM) food – approving unrestricted production of agribusiness biotech company Monsanto’s “Roundup Ready” alfalfa and sugar beets – marks a profound deepening of this centralization of food production in the hands of just a few corporations, with little but the profit motive to guide them.
IN PICTURES: From Field to Fork: The foreign and domestic food chain
Even as United States Department of Agriculture (USDA) officials enable a tighter corporate grip on the food chain, there is compelling evidence of GM foods’ ecological and human health risks, Read more…
Zardari to seek nuclear technology cooperation with Japan
TOKYO: President Asif Ali Zardari said Monday that since Japan was negotiating a deal with India to cooperate on peaceful uses of nuclear energy, the similar cooperation should be extended to his country.
“If Japan is willing to cooperate with India in nuclear technology and (is) giving nuclear technology for peaceful purposes, I do not see any reason why we should not deserve the same,” Zardari said in an interview with the Japanese media in Islamabad ahead of his departure for a three-day visit to Japan, published in leading Read more…
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