OPEC Poised To Cut Oil Output Despite Consumers’ Pleas
Erik Burns and Simeon Kerr
Why the Future is Hybrid
Fly Me to the Moon
Results 1 – 10 of about 3,440 for Saudi terrorism
The Saudis are worried
Despite the pleas of the leading oil-consuming nations to keep the taps open, OPEC looks poised to commit to cutting existing production levels, with the prospect of more to come next year.
Fearing a further fall in prices after they dropped by a quarter in recent weeks, ministers from the Organization of Petroleum Exporting Countries arriving here in Cairo ahead of Friday’s meeting said there was a growing consensus the first step would be to rein in output to the current quota ceiling of 27 million barrels a day.
After meeting with Saudi Arabia and ministers from two other Gulf producers, Kuwait’s Oil Minister Sheikh Ahmad Fahad Al-Ahmad Al-Sabah said he estimated overproduction of around 1.7 million b/d.
Al-Sabah said all OPEC members were committed to stricter compliance with the self-imposed output cap, adding that since most crude deliveries are already settled for January, the retrenching could begin from Feb 1.
OPEC would then meet again in February to assess market conditions and decide whether a more drastic move — lowering the ceiling — would be necessary.
The reason is clear
When did the Soviet Union collapse? When did reform take off in Iran? When did the Oslo peace process begin? When did economic reform become a hot topic in the Arab world? In the late 1980’s and early 1990’s. And what was also happening then? Oil prices were collapsing.
In November 1985, oil was $30 a barrel, recalled the noted oil economist Philip Verleger. By July of 1986, oil had fallen to $10 a barrel, and it did not climb back to $20 until April 1989. “Everyone thinks Ronald Reagan brought down the Soviets,” said Mr. Verleger. “That is wrong. It was the collapse of their oil rents.” It’s no accident that the 1990’s was the decade of falling oil prices and falling walls.
The technologies exist
While it is uncertain whether the car will be mass produced, it is clear that a diesel-electric hybrid would make for an extremely frugal vehicle. A study by the Laboratory for Energy and the Environment at the Massachusetts Institute of Technology, which looked at energy use over the course of a vehicle’s life, predicts that by 2020, diesel hybrids could achieve the same energy-efficiency and greenhouse-gas emissions as fuel-cell cars powered by hydrogen made from natural gas. The difference is that diesel-hybrid technology is available today.
The challange is formidable
So why are diesel hybrids taking so long to appear on the roads? Hybrid diesels impose a double price premium, explains Lindsay Brooke, an analyst at CSM Worldwide. Combining a diesel engine, (which costs around $2,000 more than a petrol engine) with a hybrid powertrain (which adds another $3,000 or so) would make for an expensive proposition. Systems to treat the exhaust would impose further costs. The prospects for diesels and diesel hybrids are particularly dim in America, where regulations in California (and, from 2007, nationwide) require diesels to be as clean as petrol-driven cars. Some progress has been made: particulate filters can now eliminate more than 90% of diesel soot. But traps for nitrogen oxides remain a challenge.
But we have done great things before
If President Bush made energy independence his moon shot, he would dry up revenue for terrorism; force Iran, Russia, Venezuela and Saudi Arabia to take the path of reform – which they will never do with $45-a-barrel oil – strengthen the dollar; and improve his own standing in Europe, by doing something huge to reduce global warming. He would also create a magnet to inspire young people to contribute to the war on terrorism and America’s future by becoming scientists, engineers and mathematicians. “This is not just a win-win,” said the Johns Hopkins foreign policy expert Michael Mandelbaum. “This is a win-win-win-win-win.”
We need to end the huge never-ending subsidy that is foreign oil. To stable, free, and civic societies, like Norway or Alaska, oil is a nice cushion. But in the barbary states it retards progress, corrupts governments, and creates a terrorist society. A $5,000 federal tax on new vehicles, fully refundable if spent on hybrid-diesel or similar technology, would be an incredible step forward
It would dry up terrorist states. It would cause reform. Heck, it would help our balance of payments. It’s the right thing to do.