by frog
Oil crisis, anyone? Lets hope everyone keeps cool heads over Iran’s nuclear programme and keeps on talking. According to these comments by Iranian general Rahim Safavi of the paramilitary revolutionary guards, any military action against Iran would result in Iran blocking the Straits of Hormuz, a vital gateway for global oil exports. Juan Cole’s website indicates that this could be done by sinking one oil supertanker.
Published in Environment & Resource Management by frog on Fri, March 31st, 2006
Tags: environment
on the trolls and those who are unable to keep on topic
The ongoing war of words is eerily similar to the build up before the Iraq war. Even this threat of sinking a supertanker is pretty serious, as insurance doesn’t apply in a war zone and hence the threat alone might be enough to stop oil transportation if this all comes to pass.
You could argue that the US has brought this crisis to a point with the infamous ‘Axis of evil’ speech, the Iraq invasion and the general vilification of Iran since Bush was elected, as well as the trashing of the Nuclear Non-Proliferation Treaty, but it is beside the point.
It is likely that Iran will perfect the technology to build nukes in the next few years, and will build them as a deterrent. The question is, will this be allowed to happen given Iran’s paraiah status, and will it be WW3 if the West decides no? And what stance should NZ take, given our wealth and way of life is totally dependent on cheap Middle Eastern oil?
Personally, I will be tuning up my bicycle.
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Surely we WANT then to block the Straits of Hormuz (hopefully not via sinking a ship of course – that would be messy).
As environmentalists an Oil crisis is when oil is cheep not when there is a drop in supply.
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I am not sure they could block the straits. The US under this administration might remove any hazard to navigation using whatever means necessary. That there might be fallout in Pakistan and India and here as well, might not mean much to the madman in chief. I mean Commander in Thief… (darn, I just can’t say those words and think about Dubya ).
respectfully
BJ
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Iraq failed to block the Straits of Hormuz during the 1980-88 Gulf War, despite repeated attempts and with a miltary much more powerful than Iran’s, so I wouldn’t take that too seriously. Both Iraq and later Iran conducted on-going attacks on tanker traffic and the oil kept flowing, in part thanks to the US re-flagging foreign tankers and crippling Iran’s navy in the 1986 attack.
Much of our oil actually comes from East Asia (Brunei etc) and Australia, and, inanely, we export most of the oil we produce and then use imported oil ourselves, so there is no real need for us to be dependent on Middle East oil.
We’ve chosen to accept a illogical global pricing system based largely on speculation, which is the economic problem. And we’ve chosen to accept a technolgy based on off-loading wastes onto the ecosystem, which is the environmental one.
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It’s not quite that simple Sam,
The Marsden point facility can handle heavy sour crude (i.e cheap) yet most of the oil extracted domestically is light sweet crude (expensive). There’s currently money to be made by selling the expensive stuff and buying cheap stuff. Who know’s what the situation will be like when the spread between heavy sour and light sweet closes.
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Then perhaps we ought to start making nicey with heavy, sour Uncle Hugo of Venezuela…
http://business.guardian.co.uk/story/0,,1745467,00.html
claims he’s got more crude than the House of Saud, 200 years’ worth of treacly gunk, a bargain at $50 a barrel. Bad news for the climate.
In the end, I think it’s fantasy to imagine that, collectively, we will be able to agree to leave it in the ground for the sake of merely saving the world. While there’s money to be made, the pumps will keep running. Which means that a high and increasing oil price is our last hope…
… and there it goes.
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Think Global recession… It may not put the price of crude in the toilet, but the ability to pay could disappear for decades. The housing market in the USA is starting to go over the cliff. The inventory is increasing wildly, the sales have slowed dramatically… prices only took a small hit so far, but as the realization percolates down to the mud for brains common citizen the pullback is going to make Kyoto look like a wet dream. Housing is 55% of the job “growth” in the USA, it is more than 50% of the non-military economy… and when (not if) it tanks the US consumers will stop. When they stop, the Chinese have nobody to sell to. The Aussies lose their market for Iron Ore and coking coal, and basically the engine of growth (destruction) will grind to a halt.
This won’t be “good” for anyone now living, but the planet might get a break because of it, and our children a break because the planet does better…
Not that I WANT to be struggling to make ends meet, but the alternatives I see for my kids are even more scary.
respectfully
(hopefully)
BJ
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Yes, exactly, Fastbike. Marsden Point was built to handle cheap oil, so we ship off our oil and ship in other people’s because there’s money to be made in the process. Likewise, I see logging trucks moving radiata logs north, while on the other side of the road, other trucks move identical logs south. I can buy Aussie muesli bars in New Zealand and New Zealand muesli bars in Aussie. I get served cheese made by a French method in Paraparaumu while flying over France. Vegetables grown near Nelson are shipped to Christchurch, sold to supermarkets and shipped back to Nelson to be sold. Fish are caught off NZ and sold in Tokyo to NZ buyers.
This colossal waste of resources is referred to as ‘the Logic of the Market’, a phrase to be spoken in hushed and reverent tones. To any person not socialised in capitalist thought processes it’s obviously mad.
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Hi all,
the use of nukes again in the gulf is only half the problem – the cloud of dust rotating in the northern hemisphere from the DU used in the 90′s is going to make it’s way down here eventually (say, about 2 decades) – cancer amongst the children of northern european nations is rising.
The irony is that I’m making this point during the week that a particularly nauseous campaign for child cancer patients is showing on tv in NZ.
Sorry, BJ, even bringing your family here is only delaying, not solving the problem. The only thing we can campaign for is the military to stop adding to the problem!
cheers, katie
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Iran would be shooting it’s self in the foot if it did blocking the Straits of Hormuz.
As the price of oil has risen people have moved to alternatives – I understand in a South America counrty (I saw the news item but the name of the country escapes me at the moment) they are moving to having no oil imports by the end of 2006.
Iran and other Middle Eastern countries need to sell oil to keep there economies running – if they don’t sell oil then there economies go into the toliet.
They need the West more than the West needs them.
While I am not under estimating the impact in the short term to the world economy, in the long term alternatives will become available.
As a Saudi Minister once was famously quoted as saying ‘The stone age didn’t end due to the lack of stone, therefore the oil age won’t end due to a lack of oil’.
As technology advances alternatives become available and as more and more people use the alternatives the price will fall.
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Mark,
Iran would not be shooting itself in the foot – it would be cremating itself via an attack by the US or it’s proxy in the ME. Quite a difference. In the meantime, watch oil prices hit a new high in the West and the “demand destruction” that entails.
And as far as who needs who, take a look at the figures:
This from BP What do you call the 40% of global primary energy that oil provides ?
What about the 95% of transport fuels ?
The country you’ll be thinking about is Brazil where they use sugar cane derived ethanol as a transport fuel. Think about scalability issues. How do you think the growing middle class in China and India are going to be driven around with this as a fuel source ?
And as far as the time needed to convert – take a read the of the Hirsch report and note he’s an optimist!
If you want to learn more about some of the real issues and how to diiferentiate facts from spin take a visit to TheOilDrum. Their intro is a good start.
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Fastbike
I think if Iran and the Middle East could no longer export oil it would have the same effect if NZ decided to no longer export primary produce overseas.
You would screw you economy over faster than you could say ‘Death to America’.
At least with primary produce you can eat it – not the same with oil.
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