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Driven by the Dramatic Collapse of US Shale, the Trump Administration Takes Aim at Venezuela
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U.S. President Donald Trump speaks about the crisis in Venezuela during a visit to Florida International University in Miami, Florida, U.S., February 18, 2019. REUTERS/Kevin Lamarque

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PRESIDENT TRUMP HAS CLAIMED THAT THE U.S. NO LONGER NEEDS FOREIGN OIL AND IS “ENERGY INDEPENDENT.” YET, NOW THE U.S. SHALE OIL INDUSTRY FACES NEAR TOTAL RUIN, MEANING THAT ANOTHER “WAR FOR OIL” COULD BE IN OUR FUTURE. WITH TRUMP AGAIN TAKING AIM AT VENEZUELA, WE MAY BE CLOSER TO WAR THAN WE THINK.

On Sunday, President Trump praised a deal reached largely by Saudi Arabia and Russia, two of the top oil producers in the world who together dominate the Organization of the Petroleum Exporting Countries (OPEC), saying that the agreed upon production cuts would “save hundreds of thousands of energy jobs in the United States.”

Despite the president’s rosy tone, most analysts have called the agreement – which presumably will freeze the Saudi-Russian oil price war that broke out last month – “too little too late” and have noted that a slew of bankruptcies from the U.S. shale oil industry are inevitable, despite the actions that have been taken. Even the Federal Reserve has stated that around 40% of domestic shale companies now face bankruptcy in just a few months if the price of oil remains under $30, a figure it is unlikely to pass for some time due to slumping demand caused by global lockdowns, among other factors that have emerged as the current coronavirus (Covid-19) crisis has played out. Trump has since fielded the possibility of imposing tariffs on oil imports to drive up oil prices and favor the domestic consumption of U.S. shale oil, but it remains to be seen if that policy will materialize.

Michael Hudson, President of The Institute for the Study of Long-Term Economic Trends (ISLET), a former Wall Street financial analyst and Distinguished Research Professor of Economics at the University of Missouri, told The Last American Vagabond that, not only are numerous shale oil companies set to go out of business, but the entire shale oil industry in the U.S. “can’t be saved.”

“We have peak shale oil,” Hudson stated, “It was always an awful idea … It’s an over indebted sector and is one of the first to go.” Hudson further asserted that the U.S. government’s “nurturing” of the shale oil sector in recent years was chiefly aimed at targeting Russia’s oil industry by driving down global oil prices, calling it an unsuccessful “anti-Russian cold war campaign” that has since backfired. He added that Trump’s recent overtures with respect to the shale oil industry are likely aimed at “making an excuse to give huge loans to the shale oil producers, as if it’s to keep them in business, and then they [the oil companies] are just going to pay the loans to themselves and go out of business. It’s a cover story for a huge corporate giveaway before this sector falls and goes bankrupt.”

Thus, the imminent reckoning for shale oil in the U.S. is unlikely to be stopped, despite the new production cuts and Trump’s efforts last month to set aside billions for the purchase of shale oil for the Strategic Petroleum Reserve (SPR), a move critics labeled as a bail-out for domestic “Big Oil” producers. In addition, the fate of U.S. shale oil is compounded by the possibility that the production cuts will not hold and that the oil price war between Saudi Arabia and Russia could flare up again at any time. Previous yet recent OPEC-brokered deals of a similar nature have ended in this way, and it is very possible – if not likely – that it will happen again.

With oil extremely cheap at the moment, some of the issues raised by shale oil bankruptcies are not necessarily of immediate concern while demand remains low. Yet, if enough U.S. domestic oil producers go bankrupt, once current lockdowns are relaxed and oil demand creeps back up to relatively normal levels, there will be less domestic oil available, despite the SPR. As a result, the U.S. will again have to look more to other countries in order to make up the difference. Though the media thus far has explored the economic effects of this eventuality, less attention – if any – has been given to how it will impact U.S. foreign policy.

For years, President Trump has publicly claimed on several occasions that U.S. foreign policy objectives in the Middle East were no longer guided by oil due to the U.S. having obtained “energy independence,” “independence” that relies heavily on U.S. shale oil production. However, critics – including Michael Hudson – have long charged that this claim of energy independence is a “deliberate falsification.” Such claims are also supported by the fact that U.S. foreign policy in Iraq, Syria and elsewhere has remained linked to oil in key ways during this period of so-called “domestic energy independence” under Trump. Yet, the bankruptcies of 40% (or perhaps more) of U.S. shale oil producers would likely greatly increase the role oil plays in guiding U.S. foreign policy.

While there are many reasons as to why oil has long been a key factor in U.S. foreign policy (with the petrodollar ranking chief among them), another often overlooked reason is the U.S. military’s heavy reliance on oil. Indeed, the U.S. military is the largest institutional purchaser and consumer of oil in the world and, therefore, securing a reliable, stable and –ideally – geographically nearby source of oil has long been deemed a critical, strategic objective by the Pentagon.

The Pentagon has said as much on numerous occasions, stating recently that “… longer operating distances, remote and austere geography, and anti-access/area denial threats [areas or nations unfriendly to the U.S.] are challenging the Department’s ability to assure the delivery of fuel. As the ability to deliver energy is placed at risk, so too is the Department’s ability to deploy and sustain forces around the globe.”

In other words, long distances from fuel sources as well as fuel sources located in or near areas/nations that are hostile to the U.S. directly threaten U.S. empire and its global military presence. In addition, control and influence over global oil flows has long been a key component of military strategy, as noted in the “Wolfowitz Doctrine.”

It is also worth noting that the economic calamity that threatens the domestic oil industry is not the only reliable, stable and geographically close oil supply to be hit by the crisis. For instance, Argentina’s shale oil industry in the “Vaca Muerta” area also faces ruin, an endeavor that had largely been “kick-started” by Exxon Mobil after that company had been ejected from Venezuela and also includes considerable investments from another U.S. oil giant, Chevron – a company ordered by the Trump administration to stop doing business in Venezuela by April 22.

Venezuela, the country with the world’s largest proven oil reserves, has also made a seemingly odd reappearance on the Trump administration’s list of priorities during the current coronavirus crisis. On March 26, the Department of Justice, led by Attorney General William Barr, announced narco-terrorism and other criminal charges against top Venezuelan officials, including the country’s president Nicolás Maduro, alleging that these officials are involved in the trafficking of cocaine to the United States. The charges were odd for a few reasons, one of the main ones being that the U.S. government’s own data shows that Colombia, not Venezuela, is the source of the vast majority of cocaine that ends up in the U.S.

Then, on March 31, former CIA director and current Secretary of State Mike Pompeo released a plan entitled “Democratic Framework for Venezuela,” where he demanded that Maduro resign and the “opposition” figure Juan Guaidó also relinquish his claim to the Venezuelan presidency, a claim to power that the U.S. had previously backed. Pompeo’s plan calls for the formation of a council that would be led by an “interim president” (a title the U.S. had previously reserved for Guaidó) and that the council would be formed by members of Venezuela’s largest four political parties, including that led by Maduro. Unsurprisingly, Maduro’s government rejected the plan.

The criminal charges against Maduro and Pompeo’s “democratic” plan were quickly followed with much more troubling news. Announced at a press conference on April 1, President Trump, alongside top government officials, announced that U.S. Southern Command would begin a new “counter-narcotics effort” targeting Venezuela that would include the deployment of Navy destroyers, combat ships, aircraft, helicopters and more. The official justification of this large deployment is to surveil, disrupt and seize shipments allegedly containing “drugs” that are leaving Venezuela. “We must not let narco-terrorists exploit the pandemic to threaten American lives,” Trump said at the time. It was also announced that other countries would be joining the U.S. in what amounts to both a military build-up and a de facto blockade of Venezuelan exports, including its oil.

Soon after the announcement regarding this new build-up and de facto naval blockade of Venezuela, U.S. media accused President Trump of using these announcements to deflect criticism about his administration’s handling of the federal response to the coronavirus crisis. One report in Newsweek revealed that these initiatives with respect to Venezuela had been planned several months ago and were set to be announced this May. That report also alleged, citing senior Pentagon officials, that the administration had decided to announce the planned crackdowns on Venezuela sooner in order to “redirect attention.”

However, there may be another reason that these initiatives targeting Venezuela were sped up: the carnage in shale oil markets in the U.S. as well as Argentina and the implications of that for U.S. access – particularly the military’s access – to oil supplies once lockdowns and their associated economic effects begin to lessen.

Michael Hudson told The Last American Vagabond that the U.S. pivot towards Venezuela was “absolutely” related to the carnage in global oil markets and particularly the U.S. oil industry. He further argued that the U.S. was seeking to reimpose a debt-for-oil system that it had enjoyed under pre-Chavista governments in Venezuela: “Under U.S.-backed dictators, Venezuela provided the collateral [for its debt] with all of its oil reserves… [Now,] America wants to give IMF [International Monetary Fund] loans to Venezuela and [oversee] the collateralization of Venezuela’s foreign debt with its oil reserves and then foreclose. [They want to] find an excuse to do to Venezuela what it did to Argentina, to grab Venezuela’s oil reserves as collateral by … preventing Venezuela from paying its foreign debt, [thus] forcing it to default on its foreign debt.”

This certainly seems to be a big part of the equation, as the U.S.-backed Juan Guaidó has long promoted IMF loans and personally sought sizable loans from that organization to finance his “interim government,” which controls essentially nothing in Venezuela. More recently, the IMF rejected Venezuela’s request for a loan to help it combat the coronavirus crisis, but the IMF has reportedly offered to give the country such a loan were Venezuela’s President, Nicolas Maduro, to step down and cede authority to a U.S.-backed “emergency government.”

Yet, there is much more to be concerned about than the IMF and the U.S.’ interest in imposing a debt-for-oil scheme on Venezuela. As Hudson told The Last American Vagabond, one very notable “great threat” is the parallel between the recent U.S. policy and military moves towards Venezuela and the moves that were made by the George H.W. Bush administration just prior to the 1989 invasion of Panama. “America would like to grab Venezuela’s oil and it wouldn’t be the first time,” said Hudson.

Though recent mainstream media reports claimed that the sudden reappearance of Venezuela on the White House’s agenda was merely political theater, subsequent events suggest something else. This past Saturday, U.S. envoy for Venezuela – war criminal and Project for a New American Century neo-con Elliott Abrams – stated that, if Venezuela’s Maduro did not agree to the Pompeo plan for a new “transition government,” a transition in Venezuelan governance would still occur, but would be more “dangerous and abrupt.” Abrams’ comments failed to generate much buzz in the media, as the April 1 press conference and announcement had done, despite the fact that Abrams was essentially starting that “dangerous and abrupt” action would be taken to force Maduro from power.

There is also the added mystery of an incident that took place right before the announcement of the large deployment of U.S. military assets to target “narco-terrorism.” On the last day of March, a Venezuelan coast guard ship asked a Portuguese cruise ship, the “RCGS Resolute,” that was in Venezuelan territorial waters to accompany it to port. Instead, the cruise ship rammed the Venezuelan vessel, sinking it. Maduro subsequently claimed that the cruise ship “was being used to transport mercenaries,” noting that Dutch authorities in Curacao, where the “RCGS Resolute” is currently docked, had been instructed to not inspect the ship. The company that owns the cruise ship, however, asserts that it is carrying no passengers and disputes Venezuela’s account of why the coast guard vessel was sunk.

In addition to this disconcerting event, there is the fact that the U.S.’ recently announced military build-up is the largest in the region since the U.S. invasion of Panama, which took place in 1989 during the George H.W. Bush administration. Disturbingly, the same Attorney General that greenlit the invasion of Panama once again serves in that same role in today’s administration, William Barr. At the time of the Panama invasion, it was Barr who created the legal justification for the war, arguing that the U.S. had the “legal authority” to arrest Panama’s then-dictator Manuel Noriega on drug charges, despite him not residing in the U.S. To think that Barr would not do so again is naive, especially considering that Trump had previously pushed to invade Venezuela, citing the invasion of Panama as an example of successful “gunboat diplomacy,” and has long talked about “taking the oil” of foreign countries and, in places like Syria, has used military force to do just that.

Though the 1989 invasion of Panama was dressed up in the typical rhetoric of restoring “democracy” and promoting “human rights,” it was actually waged with the intention to utterly destroy Panama’s military. Why would the U.S. want to destroy Panama’s capacity for self-defense? The answer lies in the treaty that then existed between Panama and the U.S. over the Panama canal, whereby control over the canal would eventually be returned to the Panamanians.

The only “loophole” for the U.S. to retain control of the canal, per that treaty, was if Panama became incapable of defending it. Notably, the gradual turnover of control of the canal was set to begin just ten days after the Bush administration’s invasion of Panama ended. Not long after the invasion, in 1991, the U.S. passed a law that ensured an indefinite U.S. military presence in the canal zone due to the fact that Panama (thanks to the U.S. invasion) could no longer defend that territory.

There are other notable points regarding the invasion of Panama that are seemingly relevant today as well. For instance, media’s effort to manufacture public consent for the invasion was largely centered around pointing out Manuel Noriega’s involvement in narco-trafficking and Panama’s lack of democracy under his rule. Of course, this rhetoric has obvious similarities to current rhetoric involving Venezuela.

However, this media campaign, in Noriega’s case, failed to note that the Noriega’s role in drug smuggling was largely on the behalf of U.S. interests and that Noriega had closely collaborated with then-President, George H.W. Bush, when he had served as CIA director. In addition, Noriega was well known at the time to have been on the CIA payroll for years. Such reports also overlooked the fact that the CIA had recently been caught driving the trafficking of drugs and weapons between Central America and the U.S. as part of the Iran Contra scandal. If these reports had pointed this out, it would have made Noriega’s involvement in these matters, including his supporting role in Iran Contra, appear negligible by comparison.

Similarly, today, efforts to link Venezuelan leadership to the drug trade fail to note that the U.S.-backed Juan Guaidó took selfies with a narco-paramilitary organization just a few months ago and that Colombian leadership and its military, the U.S.’ biggest regional supporter of its Venezuela regime change agenda, both share direct ties to drug cartels.

It is also worth pointing out that, not only did the U.S. military hide the actual civilian death toll and cover up the war crimes committed during the invasion, they tested out new experimental weapons on the Panamanian people, which CounterPunch noted was “a kind of dress rehearsal for the Persian Gulf War the following year.” As many readers of this article are likely aware, the Trump administration has been making strong overtures about regime change, and potentially war, in Iran alongside their push for regime change in Venezuela. Were a similar invasion to occur in Venezuela, it seems likely that this pattern would repeat and would be treated as an experimental battlefield for a subsequent war in Iran.

The current confluence of factors suggests that such a Panama-style invasion of Venezuela is not only a possibility, but increasingly likely. Indeed, as previously mentioned, the U.S. has ordered the few U.S. companies that have been given waivers to avoid sanctions for their operations in Venezuela (namely Chevron) to terminate their dealings in the country by April 22 – next Wednesday. In addition, soon after that date, Venezuela’s oil sector is set to resume two joint oil ventures, one of which involves two European oil companies and another that involves Russia’ Rosneft, which the U.S. sanctioned in February for doing business with Venezuela’s state oil company. Those projects are due to re-initiate in May and July, respectively. The U.S. is openly opposed to these projects going forward and has threatened sanctions (and further sanctions in Rosneft’s case) against the companies involved.

Taken in combination with Elliott Abrams’ recent statements, the massive U.S. military build-up and the collapse of U.S. oil markets, such events seem to be pointing in the direction of an invasion being more likely than not. There is also the added layer of the U.S. facing a new “Great Depression” and these major economic downturns are often followed by the U.S. entering a major war. On the other hand, there is also the fact that most of the U.S. population is on lockdown due to the coronavirus crisis, making domestic resistance against such an invasion unlikely to manifest in any significant way. If Americans aren’t careful and don’t quickly begin to pay attention, the country could soon sleepwalk into another devastating and deadly “war for oil.”

(Republished from The Last American Vagabond by permission of author or representative)
 
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  1. A123 says:

    Taken in combination with Elliott Abrams’ recent statements, the massive U.S. military build-up and the collapse of U.S. oil markets, such events seem to be pointing in the direction of an invasion being more likely than not.

    Trump refused to invade Ukraine.

    Trump refused to invade Lybia.

    Trump attempted to fully withdraw from Syria. When blocked, he preemptively moved U.S. Troops south extracting them from the now live Turkey/Iran northern front.

    Trump has made several attempts to make a full Gromov from Afghanistan following the USSR’s 1989 example. He has been thwarted by the Deep State and Afghanistan’s internal strife, but his intent is clear.

    Trump sees the expenditure for the “nation building” of bankrupt Iraq. Even if you do not believe in his personal and moral aversion to Globalist foreign adventure/catastrophe, you have to accept that Trump believes in money.

    The collapsed infrastructure of Venezuela has a current value of less than zero. There is no path to make Venezuela the 51st state, so the U.S. cannot “keep” the oil.

    There is *no* reason to believe that a pointless invasion of bankrupt Venezuela is at hand:

    NOT
    GOING
    TO HAPPEN

    Forget about it.
    _______

    PEACE 😷

    • Troll: bluedog
    • Replies: @anon
    , @Curmudgeon
  2. anon[246] • Disclaimer says:
    @A123

    The United States has spent the last several years trying to overthrow that country’s government, they’ve sanctioned them into oblivion, they even sent Elliot Abrams to stage a fake uprising. Yeah, they’re just going to lay off after all that.

    Trump refused to invade Ukraine. Trump refused to invade Lybia.

    *Libya.

    That was never on the table for either country. There have never been any serious calls in the United States to invade either country while Donald Trump has been president. I know that because I’m an American, and I live in America … unlike a certain other person here. Now you’re just making stuff up.

    The collapsed infrastructure of Venezuela has a current value of less than zero. There is no path to make Venezuela the 51st state, so the U.S. cannot “keep” the oil.

    The world’s largest proven oil reserves isn’t nothing. Nice of you to ignore that part. Further, the United States need not literally conquer a country and make it a state in order to ensure they get priority access to a country’s oil. The standard op is to have another country’s fossil fuel resources managed by American companies.

    Trump attempted to fully withdraw from Syria. When blocked, he preemptively moved U.S. Troops south extracting them from the now live Turkey/Iran northern front.

    Blocked? By whom? He’s the commander-in-chief. You can’t legally overrule his order. Look, I understand you guys over in Haifa may not understand much about my country as you’re shilling for your causes, but you could at least make the effort. Anyways, Donald Trump could remove those troops at any time. If he hasn’t, it’s either because he was never serious about it to begin with or he changed his mind.

    • Agree: Realist
  3. Kim says:

    What would the advantage be of the USA getting direct control of Venezuela and its oil (tar sands/extra heavy oil)?

    Let’s consider some facts.

    The first fact to bear in mind is that Venezuela does not have conventional oil. It actually has tar sands/extra heavy oil, a thick product that must be mined, as opposed to drilled.

    Venezuela has an estimated 298 billion barrels of proved oil reserves, the largest in the world and almost double Canada’s (173 billion barrels). Most of Venezuela’s proved oil reserves are located in the Orinoco Petroleum Belt. Although often referred to as oil sands (or tar sands), Venezuela’s oil sands are technically “extra heavy oil” deposits since they don’t contain bitumen.

    What are “proved” oil reserves? From Wikipedia.

    It is defined as the “[q]uantity of energy sources estimated with reasonable certainty, from the analysis of geologic and engineering data, to be recoverable from well established or known reservoirs with the existing equipment and under the existing operating conditions.”[1] A reserve is considered proven if it is probable that at least 90% of the resource is recoverable by economically profitable means

    Note that little condition at the end. That is the ball upon which one’s eye must be kept.

    Conventional oil is comparatively cheap to produce. You stick a pipe in the ground and pump it out. In contrast, tar sands involves a lot of processes to get it out of the ground, so it isn’t at all cheap to mine. That is why it costs at least $100/barrel and that is why Venezuela went into an economic tail spin. Venezuelan oil costs too much to bother with.

    https://www.americangeosciences.org/critical-issues/faq/what-are-tar-sands

    Because bitumen is very thick and does not flow easily, it clings to the sand and clay and can’t be simply pumped out of the ground through wells like conventional oil. Instead, tar sands are mined in two main ways:[1,2]

    Open-pit mining – if tar sands are found near the surface, as in Alberta, Canada, they can be mined directly – much like open-pit coal mining – and then transferred to an extraction plant where the bitumen can be separated from the sand, clay, and water.

    In-situ mining – if tar sands are too deep to dig up, the bitumen can be extracted by injecting hot steam or solvents to loosen up the bitumen and allow it to flow through a well to the surface.

    The big question for the USA is whether it would be economic to seize Venezuela and take its oil. It would not be free-of-charge to institute a permanent military presence there, and it would have consequences for US politics and demographics – because no doubt Venezuelans woudd be offered the compensation of US citizenship.

    On top of that, oil companies have already tried mightily to produce and sell Venezuelan oil cheaply and have failed. Could they produce it cheaper if they were given a free hand? Maybe. But how cheap does it have to be? That is the big question. The entire world is currently living on its credit card. Can we produce oil from Venezuelan oil sands at a cost that is so cheap that we can start to pay down that debt? Can it be produced so cheaply that we can start to pay wages good enough to build a middle class again?

    In any case, while it is often said that Venezuela has more “oil” than Saudi Arabia ever had, we can see that this is an apples and oranges comparison. Saudi and Middle Eastern oil was cheap, cheap, cheap to produce. Phenomenally cheap. Venezuelan oil is very expensive. Too expensive for consumers unless thay want to go further into debt.

    In the end, I suppose the US decision-makers will decide to grab Venezuela’s oil and produce it on the same basis that shale oil has been produced these last twelve years, at a loss. After all, we must have oil, even if it is only on an extend-and-pretend basis.

    To cover those losses, various parts of the world and the US economies will first shrink and then be jettisoned, as their wealth is sucked dry to subsidize the oil to make sure that the military machine – the true source of political power – gets the oil it needs.

    • Replies: @Realist
  4. Realist says:
    @Kim

    What would the advantage be of the USA getting direct control of Venezuela and its oil (tar sands/extra heavy oil)?

    Perhaps that is correct…then to what do you attribute the US interest in overthrowing the Venezuelan government?

    • Replies: @Curmudgeon
    , @Kim
  5. Putin once again demonstrated his diplomatic brilliance by the de facto nationalization of the Russian oil company Rosneft in Venezuela, placing the US on a direct confrontation course with the Russian Federation if it persists in its assault on that country.

    Here’s the Reuters account https://www.reuters.com/article/us-russia-rosneft-venezuela/rosneft-sells-venezuelan-assets-to-russia-after-u-s-sanctions-ramp-up-idUSKBN21F0W2 and the MSM propaganda version of the story is https://www.nytimes.com/2020/03/28/world/americas/venezuela-rosneft-oil.html

  6. anon[317] • Disclaimer says:

    Any Saudi-Russian deal on output is irrelevant. Goose-stepping lockdowners have ensured low oil demand for many years to come.

    On a happy note, long-suffering 350.org true believers are now reveling in their basements, eagerly awaiting further lockdown orders.

  7. In the early stages of the madness that led to the passage of the biggest boondoggle in the history of Mankind (the so-called “CARES Act”), there was indeed talk from President Trump of taking advantage of the historically-low price of oil to top off the Strategic Petroleum Reserve. “A great idea,” thought I.
    But… last I heard, the plan is now to allow the oil companies to store their excess inventory in the SPR (at no charge!) so that they can pump it out later and sell it when prices rebound.
    As usual, it’s the American taxpayer who gets bent-over.

  8. @A123

    Trump refused to invade Lybia.

    Do you mean Lydia? Either way, I don’t know who she is, but Trump has invaded a lot of labia.

    • Replies: @A123
  9. @Realist

    I can’t speak for Kim, but I have long held that it is not control of the oil, per se.

    What virtually everyone, including Ms Webb overlooks is the Chavez Bolivarian Revolution. Simply put, it seeks to trade commodity for commodity. Early in the game, Venezuela’s oil was the commodity of choice. It was traded to Cuba in exchange for medical services, as well as Argentina and Brazil for food. The deals created millions of lost petrodollars and the Bank of International Settlements lost its cut. Like Saddam selling oil in Euros, Iran’s oil bourse, or Qaddafi’s African gold dinar, all are a challenge to the petrodollar and the Bank of International Settlements. That cannot be allowed to succeed.
    The reality is the takedown of Venezuela started in Argentina by taking out the government trading commodity with Venezuela, then moved to Brazil. That left only Cuba, which is already sanctioned up the ying yang, and the Federal Reserve Bank of New York, through which all trade settled in US dollars, flows.
    The oil narrative obscures the fact that Venezuela has the world’s second largest gold deposits, a lot of bauxite, coal, and diamonds. What is avoided at all cost is talking about Coltan, a rare earth mineral used in electronics. https://venezuelanalysis.com/analysis/11372
    If trading that commodity and others, for a needed commodity, thereby bypassing the NY Fed and the Bank of International Settlements, caught on, the petrodollar house of cards would collapse.
    I remind people that a similar scheme in the 1930s was causing the same problem, and an excuse to start WWII was concocted, just as has been done in Iraq, Iran, and Libya.
    It’s all about the Benjamins.

    • Replies: @Realist
  10. A123 says:
    @Curmudgeon

    It is obvious in context “Lybia” is a typo of Libya. The joy of autocorrect software is that it can turn something typed correctly into an error. Why it does that one is a mystery to me.
    ____

    The fact that you are so emotionally distraught over an obvious typo clearly identifies you as a SJW Globalist. You are still traumatized by the defeat of your personal deity, Hillary Clinton.

    I think I have a photo of you and your fake red hair in full SJW Globalist mode:

    PEACE 😷

    • Replies: @Curmudgeon
  11. Realist says:
    @Curmudgeon

    The US has no legal business in Venezuela.

    • Agree: Curmudgeon
  12. @A123

    Yup. Caught me red headed. I have a picture of Killary in my wallet.

    • LOL: A123
  13. Kim says:
    @Realist

    Perhaps that is correct…then to what do you attribute the US interest in overthrowing the Venezuelan government?

    I do believe they are interested in overthrowing the current Venezuelan controllers and replacing them with US controllers. Because they must, somehow or other, get control of that oil.

    Given the fact that the world now consumes ten barrels of oil for every one barrel that it discovers, these last dozen years the world has been implementing the good old Red Queen strategy, where we have to run as fast as we can just to keep up.

    They need the uneconomic Venezuelan oil for the same reason they needed the uneconomic shale oil, as a way to slow and manage the energy collapse of the modern world.

    • Replies: @A123
    , @mike99588
  14. A123 says:
    @Kim

    Did the U.S. Keep Kuwaiti oil? No.

    Did the U.S. Keep Iraqi oil? No.

    Would invading Venezuela keep their oil? NO!
    _____

    As long as Trump is President the chances of a U.S. offensive are 0%. There is nothing to gain.

    If the a SJW Globalist (Hillary/Biden/Cuomo) becomes President, then invasion is inevitable.

    Vote PEACE — Vote TRUMP 😷

    • Replies: @Kim
    , @bluedog
  15. mike99588 says:
    @Kim

    Lots of natural gas to replace many oil uses with, for decades if not centuries. Assuming cheaper options aren’t available then. I view thermal breeders, fueled by thorium and present wastes, as a fail safe option for the doom and gloom peak energy crowd, but expect other things to evolve.

    Even heavy air and space transport could re-engineeer and use methane well.

    • Replies: @Kim
  16. Kim says:
    @mike99588

    Lots of natural gas to replace many oil uses with, for decades if not centuries. Assuming cheaper options aren’t available then. I view thermal breeders, fueled by thorium and present wastes, as a fail safe option for the doom and gloom peak energy crowd, but expect other things to evolve.

    Even heavy air and space transport could re-engineeer and use methane well.

    First, I don’t think you have any idea of the scale of what you are suggesting, of just how much oil the world uses each year, nor of the great variety of its uses.

    Second, if oil could be so simply replaced, and especially if it could be so easily replaced at a negligible cost and without substantial social disruptions – as your suggestions imply – there is no doubt the process of doing that would be well under way by now. But for some reason it is not.

    So let me introduce you to a concept and some research that will begin to familiarize you with the enormousness of the task that it would be to replace the oil that the world uses each year. The concept is called The Cubic Mile of Oil, and if you wish to read up some more on it, you can follow this link: https://en.wikipedia.org/wiki/Cubic_mile_of_oil, but what follows is my precis.

    The cubic mile of oil (CMO) is defined as the energy released by burning a cubic mile of oil. The world currently consumes approximately 3 CMO annually from all sources but a little more than 1 CMO comes from oil.

    The CMO is a powerful means of understanding the difficulty of replacing oil energy by other sources. In 2007, SRI International chemist Ripudaman Malhotra, working with Crane and colleague Ed Kinderman, used it to describe the looming energy crisis in sobering terms. Malhotra illustrates the problem of producing one CMO energy that we currently derive from oil each year from five different alternative sources. Installing capacity to produce 1 CMO per year requires long and significant development.

    Allowing fifty years to develop the requisite capacity, 1 CMO of energy per year could be produced by any one of these developments:

    – 4 Three Gorges Dams,[13] developed each year for 50 years, or
    – 52 nuclear power plants,[14] developed each year for 50 years, or
    – 104 coal-fired power plants,[15] developed each year for 50 years, or
    – 32,850 wind turbines,[16][17] developed each year for 50 years, or
    – 91,250,000 rooftop solar photovoltaic panels[18] developed each year for 50 years

    You seem to think that oil will be easily replaced. Perhaps you have a plan to build 52 thorium plants a year each year for the next 50 years. Great. I wish you all the best. But even that would leave an enormous number of problems. Electricity is not a simple replacement for oil. For example, in South East Asia and China there are tens of millions of peasant farmers who use millions of petrol driven pumps to irrigate their fields. If they can’t do that, they get only one rice harvest a year, not three.

    How will a thorium reactor drive those petrol pumps? Or perhaps that part of the world can simply give up on eating so much rice?

    Anyway, I’ll leave it there. I am sure you don’t really want to know anyway, but what you are suggesting is just ludicrous.

    And let me know when you have finished building your next four Three Gorges Dams. That should be about this time next year, right?

  17. Kim says:
    @A123

    Did the USA keep Iraqi oil or Kuwaiti oil?

    I am pretty confident that the oil of those countries is not in the hands of regimes unpopular with the US government, such as Iran and China. So the oil of Iraq and Kuwait are – I am pretty sure – entirely under the control of their “protectors”, the USA.

    I am just as sure that China will not be allowed to control Venezuelan tar sands.

    I am also pretty sure that all of these countries will continue to be required to sell their oil in dollars and will be in bad trouble if they try to do otherwise (as poor old Saddam did).

    That’s just about as good a type of owning and “keeping” that anyone could ask for.

  18. “…Downturns are often followed by the U.S. entering a major war…”
    The route to major war – and world war – can be traced through history. Retrospectively the course it takes can be clear: today leaders need the prescience to see where the road is leading them and their peoples, and choose a different path before it is too late.
    https://www.ghostsofhistory.wordpress.com/

  19. bluedog says:
    @A123

    KEEP THE OIL so says TRUMP in Syria and yes so called American interest does play in the oil in Iraq why do you think we refuse to get out.No wonder your labeled as a troll with your endless nonsense.!!!!

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