Jun

23

It Did Accomplish Many Things: Jeddah Oil Summit

June 23, 2008 |

CNBC contends that the Jeddah Oil Summit didn’t accomplish anything - oil prices started climbing again in early trading Monday morning.  The only significant event was the announcement by Saudi Arabia to raise oil production to their highest levels in 30 years.  The fact that Nigeria is under civil war and decreasing their oil output by the minute, and most of the other OPEC countries do not want to (or may not be able to) raise oil output didn’t helped.

It did accomplished many things (mostly from educational perspective):

  • Help Yourself First: It shows that if you drag yourself into trouble like we have dragged us into oil dependency, there is no easy solution and no unilateral party that can solve the issue.  It has happened in the past as well:  some countries have dragged themselves into war and then ask the world to help, others have dragged themselves into famine and then ask the world to help.  In the USA we have dragged ourselves into oil dependency: we can’t just ask people to help.
  •  They Are Not Nice: The Saudis seem to be the only half-reasonable guys in the OPEC.  For as much as you should always show respect for human beings (and other creatures), most of OPEC is looking after themselves without regards to their clients (bad business practice, I know - but nobody said they where great businessmen — they just have a product in high demand).  It is good to know who is your friend and who isn’t.
  • Talk is Cheap: The actions taken in the Summit could have been taken without the Summit.  Saudi Arabia had already announced their intention to increase output.  And the other nations didn’t reached any new agreements.  Talk is cheap: it is entertaining, it is informative (like this blog, I hope).  But it doesn’t cause too much action.
  • Only One Long Term Way: We need to cut ourselves from foreign oil.  We need nuclear and coal power.  We need more coal to oil conversions.  We need to abandon our long-commute workplaces in favor of producing our own substenance locally (like I did).  We need to save power on heating and cooling.  I want to buy a Chevy Volt or other plug-in hybrids.

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