Saudi Situation Critical

We are not being told the truth. Saudi Arabia is about to fall. The Houthis have knocked out most of Saudi oil production and refining. As well, they've just shot down a Saudi F-15, using a missile they modified to being surface to air. 

Saudi Arabia's Aramco has notified European customers that deliveries may be suspended from late September. This will cause a fuel crisis as Russian oil has been blocked too, partly as a result of war, but also as a result of sanctions, which I said at the time was an act of self-harm.

The entire world is affected by this development; the US imports critical supplies from Europe, and now these may not arrive, while Saudi oil also heads to the Far East and this will be choked off as well. Can it get any worse? 

Oil production in Africa is ramping up, and Venezuelan flows may return, both of which may reclaim some supply, but globally, the World is in deep trouble right now. What we are looking at, potentially, is a Depression of the late 1920's kind. The problem is, the current leadership in every country is completely hopeless and incompetent beyond belief.

Countries Running Out of Fuel

After reading that the last oil shipment from before the war had just arrived in California, I asked myself; who will run out first?

Currently, there are five countries that could run out of fuel very soon: Philippines, Bangladesh, Malawi, Solomon Islands, Pakistan.

The Problem is Worldwide

Elon Musk has accurately outlined the problem. In a leaked internal email to staff, he said he had a 'super bad feeling' about the economy:

https://www.entrepreneur.com/article/428840

Then, on Twitter he has previously stated:

https://www.entrepreneur.com/article/428451

"It has been raining money on fools for too long. Some bankruptcies need to happen," ..... "Also, all the Covid stay-at-home stuff has tricked people into thinking that you don't actually need to work hard. Rude awakening inbound!"

I agree with Musk on both counts. I have frequently said the bailouts due to the GFC have entrenched incompetence. Businesses should not be too big to fail. If they fail, let the bargain hunters devour them, and out of the change grow stronger. Yes, this disrupts lives, but look at where we are at right now. Things are going to be worse.

We've been living in a huge government-led Ponzi scheme, created using the taxpayers money. This couldn't be sustained so they manufactured a pandemic, or scamdemic as I like to call it. The response was planned to crash the world economy. They, and by 'they' I'm talking about the 'powers-that-be' for want of a better term, didn't care about how many people were killed, all they cared about was saving their own scrawny necks and the corrupt companies underneath them.

The 'Great Reset' is an arse covering exercise. 

But it didn't work well enough as people didn't 'drink the tea'. Turns out the people are not that stupid. Well, except silly countries like Australia and New Zealand, they're very silly. What to do then? Need for war. So, NATO prods the bear - Russia. Now, famine looms in countries relying on Russian and Ukrainian food, while energy prices soar. Will profits from high oil prices be returned to the people for better healthcare and education? That was me kidding you, you can stop laughing as we know that will never happen.

Basically, what I'm outlining is a massive stitch-up. The only way to correct this is to remove those in power. We need new governments with new ideas. The current crop are trying to destroy you and ultimately kill you if they can. Don't let them.

Security of Energy Supplies

 I notice the large oil refinery at Altona in Australia is due to close. 

https://www.theguardian.com/australia-news/2021/feb/10/coalition-urged-to-confront-australias-severe-fuel-insecurity-as-altona-oil-refinery-closes

New Zealand's one oil refinery at Whangarei in Northland is also to become a fuel terminal only. But for Australia, given it is a large developed economy, not being able to refine its own crude leaves it vulnerable in times of war. Key infrastructure must be protected. There really is no alternative for this; having to import all fuel supplies already refined means the country can be defeated by simply shutting off that supply. Wake up Australia and New Zealand.

Oil Price Tumbles

The oil price is tumbling and that's a good thing. Oil feeds into every part of the economy and now the price of goods can come down. Consumers are going to have some hard earned cash in their pockets for a change.

The collapse in oil price is partly due to the Coronavirus and a fall in demand as people stay at home, but also because Russia and Saudi Arabia disagree on oil output and have begun pumping furiously. They can keep that up as far as I'm concerned.

This spells trouble ahead for Wall Street. Many American companies associated with oil have loans maturing soon, and they don't look as good with the price of oil being so low. I explain it like this; if a company is now worth $10 billion and has $6 billion in debt all maturing soon, and the price of oil slips leaving the company now worth $7 billion, it cannot roll over the debt as it doesn't have enough net equity on its balance sheet. It would be able to raise about $4 billion, meaning $2 billion has to be tipped in by shareholders. Across the board that's going to embarrass many investors and some companies will collapse. The message is - don't have too much debt.

Big Oil and Electric Vehicles

I thought of this lovely conspiracy theory, have fun with it. I haven't seen this anywhere else, so I apologise in advance if this isn't an original idea.

As I've outlined numerous times, electric vehicles (EV's) are total nonsense, a complete waste of time, don't even think about them. That's the well considered experienced view of the matter, all very scientific.

But hang on, what if the fact EV's are utter crap has something to do with why they're being pushed so hard. What if the big oil companies and the myriad of companies heavily reliant on the liquid fuels infrastructure are pushing EV's as they know they're rubbish. They're doing this to discredit alternative fuels or forms of energy. The result would be to force people back to the internal combustion engine and this would be for the foreseeable future. In other words, EV's are a stalking horse, concealing big oil's desire to lock in fossil fuels. Hmm?

Note that Norway, the world's biggest hypocrite which has made a fortune from oil and gas is heavily promoting EV's. Sweden is not far behind this, they're massive hypocrite's too but they'd be promoting their carbon capture technology. There'd be a lot of interconnecting and overlapping agendas with this theory, but they all have one goal; to lock in people to a future that relies entirely on old industries that have morphed into new, sexy, born again new technology companies. Old technology companies that are really old tech re-branded or re-skinned.

To support this theory, consider ideas that never get looked at seriously. We have the idea of the water powered car, which are generally discredited. One in New Zealand was designed and built, the story of which you can read about here: https://waterpoweredcar.com/archieblue.html

The argument against this is that it involves more energy (or the same amount) to separate the hydrogen and so there is no gain. Fine, but what about a nuclear car? The nuclear reactor generating heat, then a steam engine is used for motive power. The amount of uranium needed to drive a car its entire useful life would be extremely small. Even microscopic. It would not be enough to create an explosion, it would be more like a clock with reflective hour and seconds hands and numbers.

Such a car completely circumvents the liquid fuels infrastructure. No gas stations, and very few oil refineries would be needed as only certain lubricants would be required for wheel bearings and the like. These ideas would be ditched because of that very fact. In this new green age of Corporate Green only the right technology is accepted and that has to be based upon centralised models that rely on the existing companies (or sources of capital ) to provide the solutions. Independence is not allowed, with this idea that's exactly why EV's are promoted, they're to fail as they must, sending people into the arms of Big Oil.

USA and Saudi Arabia v Iran

A rather obvious question this but I haven't seen it addressed very closely. If - and that is a big if - Iran has attacked Saudi oil installations, knocking out about 6% of global oil supply, why is the USA so keen to fight Saudi Arabia's battles? The Saudis have spent a lot of money buying American equipment, can't they look after themselves?

US Sanctions on Iran

It's not easy to find a simple description of what the sanctions are exactly and what they mean, but I've found the following at Deutsche Welle. It's an earlier article but includes what the latest sanctions are as well.

 https://www.dw.com/en/us-reimposes-sanctions-on-iran-what-does-that-mean/a-44967074

I'm not expert in how this sort of thing works, but wouldn't Iran now just move to deal in crypto-currency? That would seem to be a fairly obvious approach.

It is also likely to hand a considerable market to both China and Russia. Not a bright move this then, such sanctions will hurt the average Iranian but are unlikely to work as intended.

The Last Time Oil Price Collapsed

That's right, the last time we found ourselves in this position was late 2008 and the start of the Global Financial Crisis. Michael Snyder provides the following analysis, read it and weep;

Guess What Happened The Last Time The Price Of Oil Crashed Like This

Now let's be careful, I'm NOT saying the oil price drop is causing anything, what I'm saying is it's indicative, a symptom of a wider malaise, a general lack of demand for anything. Why do people need more stuff ? We've got enough already.

Less demand, lower production, less employment, lower incomes; recession.

https://www.linkedin.com/pulse/last-time-oil-price-collapsed-ken-horlor?trk=prof-post