We have an unfortunate dilemma in Iraq right now, and that is the flow of oil is not increasing fast enough to meet the increasing demand in the market place. Also, as we approach $100 per barrel oil prices, it’s going to take its toll on the first world industrialized nations. It is my contention that if we can being up oil production, the money flows will help the economy, pay for security, and maybe give a breathing room for the parliament to do a little political magic?
Last month, I was discussing this issue and my acquaintance thus, asked me; “How hard is it to bring oil production up to speed quicker?”
Not too hard, the oil is easy to get at. They are building more pipelines to the port. They still have problems bringing in the water needed to pump back into the ground as the oil is taken out, that’s an engineering and money issue. You see, strong oil production from Iraq will assist in counter balancing OPEC. It could happen faster with more umph, capital flow, security, and governmental stability – and prevention of Iranian insurgents undermining new infrastructure.
Another issue is capital flows, risk/reward, without a stable government, how can anyone trust what’s going on. Also the cost to ensure safety of the teams and oil service company crews is a real bitch. But there are plenty of people who know how. We should have taken complete control of it, handed out the oil contracts to US companies, or Multinational Oil Giants we’ve done business with, and given a percentage to the Iraqi government – kept the rest to pay the $1 trillion war costs, and built schools, roads, water treatment, power stations, pipelines, etc. using Bechtel, Slumberger, Halliburton, etc, etc, we know how to build stuff.
We could have done it with just handshakes, because all these people have worked together before, and they know the drill – too much corruption in Iraq now. Of course, if the military were to guard the oil assets, and companies, you can bet the Democrats and conspiracy nuts would have come out of the wood work to complain. But that’s what should have been done. We also could have kept the oil barrel prices steady at $50 – 60 and everyone would have been happy enough, and our economy would have recovered sooner.
Also there would have been enough oil in the world supply to keep China and India happy without hurting the rest of the world’s economy. Then allow the oil barrel prices to creep back up to $70. Everything would have been paid for. But instead we have China doing a scavenger hunt world-wide for oil and they are unfortunately making deals with rogue nations, regimes, and dictators, which destabilizes other nations too.
So, my acquaintance asks; “What do you have to do first?”
Unfortunately, there have been problems in the Iraqi Parliament in making the oil lease deals and corruption involved too? Surprise, surprise, but if we don’t get the security down, that is to say, we need security and stability first. Now you hate wars and so do I, but we are already in a war with Iran, they are using insurgents in Iraq, and Afghanistan, supplying weapons, expertise, personnel to kill NATO and US troops. Iran is causing conflict in the Middle East and hurting Iraq, and may end up igniting an escalating war.
My personal view is that Iran is surrounded, and we need to re-balance power in the region, easiest way is to get Iran to stop what they are doing and interfering, through regime change. That might also assist in preventing the nuclear weapons push from Iran which threatens more than just that region. Please consider all this.