|Gunder Frank Contributions to Public Discussions
---------- Forwarded message ----------
Date: Sun, 21 Oct 2001 01:00:48 -0400 (EDT)
From: Andre Gunder Frank
Cc: email@example.com, Mark Jones firstname.lastname@example.org
Subject: Mark on opec et al
""Saudi''Arabia powder keg, yes, but I disgree strongly with Mark in re quote #
1 below and have serious reservations in re # 2 and # 3. am puzzled by the whole lot.
# 3 first. It seems to me this is in no way an # either/or matter, but a both one. Any
other source of oil become an important altrernative if any one/two.. other/s is/are cut
off or exhausted. So pushing for Casp & CA oil is an important fall back strategy in
case ''Middle Eastern"" [ i dont like thius Eurocentric neocolonialist term, the
colonialist one was NEAR, and i never use them in public] oil becomes a problem .
problematic it is already. granted that it will take time to get SOME MORE CA oil on
stream. Al the more reason to start now.
but this raises other issues:
a. no one wants to invest in getting oil when its price is low - as it was much of the
time since the breakup of the SU. [never mind the in principle rationality of looking far
down the pipeline road, if your OWN cash/flow is involved]. b. Russia and Iran. get them
on board. for both their oil [Rus still the world's largest, not S Arab!] and for their
transit possibilities. The Russians already have pipelines in place and they can be
sup/comp-lemented faster than starting from scratch elsewhere. And Iran- haas been pumping
for ''the swap'' - it exports more from its gulf fields in exchange for using some oil
& gas piped into its Theran etc populatioin/productin centers in the Irani north.
now Mark's # 1 below
# 1 .In short, right now it looks as though the West has lost the latest oil-war even
before it has really begun. Meanwhile the capitalist world economy has gone into
recession. If the US has lost the latest round in its thirty-year struggle with Opec, the
prospects for economic recovery are dire.
a. there has NEVER been a west/opec struggle. even at the time of the first 1973 ''oil
shock'' our ever friend/ly Kissinger did what he could to get the oil price HIGH, not low!
and the ''oil shock'' was then and has till till now been completely WRONGLY said to hav e
been the cause or even the spark for the 73-75 recession -- nor the 79 one for the 79-82
recess, that started in june and the real price hike in dec 79, both of which served
mostly to recupoerate real vale of dollar-=priced oil when the $ had declined [there are a
lot of things i dunno, including a lot that i wrote/write about - but that IS soemthing I
DO KNOW about, and wrote it down in the mid 70s and published among others in my 1980
CRISIS books] . to summarize, there was no Wedst-OPEC battle b. opec never had the
slightest bit of power, bargaining or otherwise. one becauss of bringing altern ative oil
sources on stream that soon outproduced/sold and underpriced [that is had no quota
restrictions] in re opec - not accidental that Mexico, Indonesia etc did not join, never
mind the north sea], as well as reducing the oil-input/production- output and alos
two because it is the state or cycle phase of the world econ that is deecisive. in a
recessioon , opec has no bargaining power at all, and the rest of the time it cant control
its own member whpo want to jump quotas. even Saudi manipulation of supplies has little
effect. that leads to # 2 below
Mark # 2 In the past two years, Opec has regained its control over the market, something
it has been trying to reestablish since the 1980s. The reason is simple: world oil
production is at or near the peak, and many non-Opec provinces (N America, Russia, North
Sea, Mexico, Nigeria, China) have entered a phase of dramatic production declines. If Opec
(meaning the Gulf) was not able to get monopoly control of the market, bin Laden would not
be the menace he is, and it's that simple. As long as the US was able to manipulate oil
prices, everything was fine.
opec HAS NO market control, never did, not likely to ever get it/any.
even if the places you mention were tru. some are . others are not. Russia pumped &
exported muich more before and has b een in the dumps because the UDS has shoved the whole
conntry down the rat hole and because oil prices were low, so no incnetive to overcome
that problem. China productin is on the way up, not down. although i would grtant you
thsat china consumption is going up faster than own production, hence interest in Khazak
oil.Siberian oil is virtually untapped.south china sea also.
it seems to me that even these two items # 1 and #2 pull quite a lot of rug out from under
If the US wanted to get ObL, the pospects would be 1,000 better with an israeli style
commando without war , than with and B-52s cum blockbusters. even getting rid of Taliban,
now that it has turned out not to be able to do the job it was meant to do, could be more
efffectivfely and cheaper donw in other ways/s. the US/Rus earlier agreement via t he UN
to go get ObL was 99 % excuse to let the US go after CA.
The Gulf and east mediterranean regiemes ARE a perhaps THE problem, but war in Afghanistan
does not ameliorate but substantially enhances the problem. plus threatening to p[ush
pakistan over the brink as well - shows how irresponsible, since that is pitting
fundamentalists with CA interestsand Kashmir interests/weapon there against India, both
with the bomb.
ANDRE GUNDER FRANK
Senior Fellow Residence World History Center
One Longfellow Place
270 Holmes Hall Boston, MA 02114 USA Boston, MA 02115 USA
Tel: 617-948 2315
Tel: 617 - 373 4060
Fax: 617-948 2316