There has been speculation that the Saudis are going after the shale producers the frackers, Russia Venezuela or Iran. And others, who say that is all humbug.
Oil exploration sometimes tends to run as a sort of in-house pyramid scheme, with the revenue from drilled wells partially funding the drilling of more wells. But if the last set of wells doesn't pay off, then the driller's entire enterprise can come crashing down. It's happened before. I drove through Texas in the late `80s, when crude oil prices had fallen by two-thirds from the late `70s. There were hand-lettered signs on telephone poles which advertised homes for sale. If this goes on for a lot longer, the North Dakota Oil Patch may soon resemble a ghost town.
I don't know about Venezuela. I suspect that those whispering in the Saudis' ears to punish Iran and Russia are smoking crack. The Iranian clergy has a firm grip on the police and the military and as long as the money is there to pay them, they have an iron hand controlling the population. The Shah may have had some reluctance to machine-gun crowds, the mullahs' probably don't.
As for Russia goes, dream on. The
People in most countries coalesce behind their national leaders when their country is being attacked. The Russians are no different. Stalin killed millions of his own people, through both engineered famines, mass arrests, brutal slave-labor camps and executions, but when the Germans invaded, the Russian people worked miracles.
Against a disciplined populace, sanctions are meaningless. You need only to look to Cuba to see that. But Russia isn't Cuba. Cuba is a mouse-belch on the economic stage. Russia is the world's eighth largest economy; waging economic war on Russia is risking damaging everyone else. And if the world slips back into a recession over this, nobody's going to be blaming the Russians for it.
1 comment:
The link doesn't work, but that's OK. It only takes a minute to think of half a dozen things that it could refer to.
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