Saudi Refining..Recovered? I Call BS!

The announcement came today from Saudi Arabia that they had already recovered their oil refining capacity from the attack a few days ago and would be at full capacity in 2–3 weeks.

Now, there are a number of possibilities here. First, as mentioned in my first article on the subject, they had been running at reduced capacity for some time. So maybe that refinery or another not running at capacity simply increased output.

However, to be back at full capacity in 2–3 weeks would be beyond possibility. That attack reduced refining by 50% with fires so extensive that the smoke was seen in space. So, what? Did they just have enough equipment sitting around unused, enough to basically build half of a refinery? That doesn’t sound likely. Ordering new equipment, shipping from other countries, transporting massive pieces of equipment and installing it doesn’t happen in that time frame.

Then there is another possibility. That the whole thing was a ruse meant to portray Iran badly.

Or there is the possibility that they are lying and have not recovered capacity. They may do that to make it seem to their adversaries that the attack was ineffective, so as to discourage future attacks.

I am guessing the truth is a combination of the latter and having unused refinery capacity which they restarted. This would also discourage trading partners from seeking out other sources for oil products, which they had to already be doing.

No matter what the truth is, Saudi Arabia seems to be taking a passive role in the warmongering rhetoric coming from Israel and Washington, who were not attacked. Perhaps they think the US will take unilateral action against Iran without Saudis being directly involved. The rhetoric from DC is claiming that “intelligence shows” the attack was by missiles launched from Iran. By inserting the word “intelligence”, what they are truly trying to do is say the information is classified, so you don’t get to see it. None of it. No images, nothing.

Once again our government is trying to push this country into a war based on “information” which we do not get to verify or examine. There is nothing to gain for the people of this country. An actual conflict, as I noted previously, will diminish oil availability globally. The only people who gain would be US oil producers. Your cost on absolutely everything would increase substantially. Iran would actually attack Saudi oil refineries and fields. The environment would suffer horribly. The next “defense” budget would be even higher than it is now. Yet that would not stop other countries from seeking oil from other sources. Like Russia, who would be unaffected by this conflict.

Right now is the time that you need to call or write elected officials and tell them “Hands Off Iran”. That you do not support any form of attack against Iran or any other country. Don’t wait. Do it today.

Tapping Strategic Reserves Is A Ploy

In response to the attack on the Saudi oil refinery, Trump has said he will tap the National Strategic Reserve. This is a ploy. If not for it being a ploy, I would be forced to say, “My, how SOCIALIST of him.”

The strategic reserve is in place to safeguard against a national oil and gas shortage, as happened in the early 70’s. We are not there, nor are we at risk of being there.

Not long ago, Trump was crowing about how the US is now a “net” oil exporter. Meaning we export more oil than we import. We still import oil. Lots of it from Saudi Arabia. So, what’s the problem? Stop exporting, right?

Wrong. There are several issues at play here.

First, ceasing the export of US oil would mean impacting the petrodollar system directly. Which will already see a significant impact because Saudi oil is sold anywhere in the world in dollars, a significant portion of the petrodollar system and the original petrodollar itself. For that to be reduced by half takes a huge bite out of the petrodollar system because a lot fewer dollars are being traded internationally. If we stopped exporting oil, that would result in a drop of roughly 75% of the value of the petrodollar itself. Assume import/export to be equal, so 50/50. Half of the imports gone means a reduction of 25% of the petrodollar. Reduce export by 100% and you cut another 50% of the petrodollar value.

Second, this is a giveaway to the oil companies. There is no federal oil refinery, no federal wells in operation. What comprises the strategic reserve is purchased from oil companies at roughly market price. In other words, it was replenished while the cost of oil was low. Now, if we exhaust some or all the reserves, they will have to be replenished later. At higher cost to us, higher profit to oil companies.

All of this is aside from this action being extremely dangerous. Who is to say that Yemen will not destroy another Saudi refinery? Even if they do not, what happens if we deplete the reserves while we do not need it, then run into the situation that we do need it?

The short answer is, we’d be screwed. The major purpose of the strategic reserve is so that the military and government can keep functioning in an emergency. Not the whole country. Deplete the reserves and then have an emergency, that would mean the government and military would be stopped in their tracks.

In fact, the world is watching. Including Iran. If we attack Iran, they could very well attack the other Saudi oil refinery/ies, reserves and naval ports. That would crush the petrodollar, freeze the country and partially cripple the military.

I see a ration card in your future.

Understand, we do not produce enough oil to be energy independent at current capacity. I don’t know the actual numbers but will give an example. Say we use 120 gals of oil per day. We export 50 barrels per day and use 50. That means 70 barrels of what we use is imported. If we stopped importing, we would still be 20 barrels short.

“We can just buy more oil from other countries.”

Wrong, bucko. The Saudi reduction in oil means less oil sold to all countries that buy from them, not just the US. So there will be fierce competition to buy oil from other sources. We would be one in a crowd, all fighting for the same scraps.

The fact is, a small, war torn country in the Middle East may well have just figured out a way to destroy the United States as we know it. Without ever having to threaten us directly. I don’t know about you but after all the weapons we’ve sold Saudi Arabia, I’d call that karma.

I’d say it’s about time the US stepped up to the bargaining table and stopped being the bully/bully’s friend. No threats are going to help with this. Only a diplomatic solution will do anything worthwhile.

Saudi Oil Refinery On Fire.. Who Benefits?

The tale being told to us is that Iran was somehow behind the drone attack on what is reportedly the world’s largest oil refinery. The result of that attack being a reduction of Saudi oil production by a full 50%.

First, read that last sentence again. Saudi oil production has been reduced by a full 50%.

Now, there is the fact that the Saudis had voluntarily reduced oil production for quite some time to boost oil prices. Because the US has maintained oil production, the Saudi reduction had limited success and oil prices have remained low.

Now consider the fact that this is occurring at the exact same time that several other major oil producing nations are being actively and aggressively sanctioned by the US, driving down the oil available on the world market. Iran, Venezuela and Russia are all being sanctioned at the same time.

Not only is there no evidence that Iran was involved in this, they would stand nothing to gain from it and it would involve considerable risk. Israel and the US are already standing with their itchy fingers on the triggers, anxious to find an excuse to attack Iran. With a false accusation against Iran, this would drag Saudi Arabia into that mixture. Iran stated that they could and would block the Strait of Hormuz to tanker traffic to and from Saudi Arabia. That action is legal while involving no violence or destruction of infrastructure.

The destruction of the Saudi refinery does not lead to increased oil sales for Iran. It does increase oil sales for the US.

Houthi rebels in Yemen have claimed responsibility for the attack and had announced plans for effective attacks weeks prior. All in response to years of the worst humanitarian crisis in modern times imposed on their country by Saudi Arabia.

There can be little question that one expected result of this will be increased use of the petrodollar. However- If the US and OPEC nations are unable to meet the demand for oil on the international market, that could very well backfire. Winter months in the Northern hemisphere are not far off, especially for Northern Europe, where winter begins as early as late Sept or early October. So this could very well result in Europe increasing oil purchasing from Russia, thanks to unpredictable supply and increased pricing regarding the US oil supply. Winter months are the most turbulent for the north Atlantic, the route tankers must traverse between the US and Europe. China may well break with the US and increase oil purchases from Venezuela and Iran.

Should other countries make such trade agreements, there is the very good chance that any oil trade agreements will be gone for years, decades, possibly forever.

One of the biggest tasks for the US administration now will be to convince other nations that Iran is somehow responsible for the attack. This is not likely to happen, as other nations are less likely than the US to run up further debt than they currently have for the purpose of waging what will absolutely be a protracted war with Iran. Other nations have a longer history than the US and have not forgotten the invasion of Iraq or destruction of Syria via US terrorist proxies. Europe is still dealing with the fallout of refugees coming from Middle Eastern countries, placing extreme strain on their economies and safety. Nor have they been convinced that Iran violated the terms of the JCPOA, which has been the ongoing rationale for the increased tensions with Iran. Nor are they blind to the Trump administration attempting to find an excuse to attack Iran.

As of today, oil prices have increased by 20%. In real terms, that is an increase of 40¢ on every $2 gallon of gas. As winter approaches, that cost will increase. The effects on the US and other economies will be immediate, severe and long term. We will soon see increases in the prices of all consumer goods, utility bills and electronic services.

We ALL need to stop this in it’s tracks by calling and writing our elected officials to tell them NO WAR WITH IRAN.

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The Real Cost of Gas and Oil

Americans think when they fill up their gas tank that the price displayed on the pump is what they are paying. Many of these people also think they hate Socialism. Yet when they fill up their tank, they are benefiting from what comes down to Socialism.

Oil companies receive direct government subsidies from the federal government of roughly $38 billion a year. However, that’s not nearly all they get from the taxpayer.

Some oil companies have government contracts, federal, state and/or local. Some of those contracts are with the US military, the singular entity which uses more oil than any other entity on earth. More than all of Europe, the UK and all South American military organizations combined. You pay for that.

In many cases, oil tankers have military escorts for their security, whether the tanker is coming in or leaving. We have military vessels in the Persian Gulf and Strait of Hormuz, providing security for tankers that are not American owned, not delivering anything to or from America. You pay for that.

If a US oil company has a major spill or explosion anywhere in the world, our government pays for 90% of the cleanup. In fact, it does not have to be a US company. Remember BP with the largest oil spill in history? The fine levied on them paid for maybe 10% of the cleanup cost, the US government funded the rest. You pay for that.

When an oil company had a standoff with the Water Protectors over the DAPL using militarized police, you paid for that. Each time police respond to any protest against corporate interests of any kind, you pay for that.

When the government hands money to oil companies which the nation goes further in debt for, including the interest on national debt, you pay for that.

When our government spends trillions bombing other countries for decades for the sake of seizing that country’s resources, you pay for that.

Both major parties approved a tax cut for corporations, which they used to buy back their own stock. That’s still happening. You pay for that.

The thing to keep in mind is that oil subsidies are absolutely a form of Socialism. We all pay for the subsidies, even if a person does not drive or lives off the grid. In other words, they are not buying gas and oil yet they are paying for you to pay less at the pump. Which makes you a Socialist.

You subsidize low gas and oil prices for corporate fleets. You pay subsidies in the form of higher taxes on every dollar you earn, even if you get nothing in return. This helps corporations state higher profits and boost their stock prices. Rich investors and CEO’s get subsidies for their stock values and dividends. You pay for that.

No matter how you view it, this is welfare and Socialism for corporations and the rich. You insure the continued profits for them, no matter what the economy looks like, no matter how many workers they lay off. Capitalism for you, Socialism for them.

Add all the above to how much you pay at the pump and ask yourself how much you are really paying. What is the real price of that gallon of gas? You have no idea and neither do I. Nobody does because it cannot truly be calculated.

Even if you think climate change is not real, how is renewable energy looking now?

Attacking Iran Would Not Be A Small Issue

This past week, Trump first called for a bomb strike on Iran. Then, when that strike was allegedly imminent, he called it off.

I am very happy he called it off. That strike would have, as others have stated, unleashed hell on earth. Iran has a large and experienced military and connections to numerous countries. This would not be another Iraq or Afghanistan.

I’ve pointed out on too many occasions to count the fact that most Americans are willfully ignorant of. That we are currently bombing 7 countries. This is not a new development, we have been bombing the same 7 countries for years. If you doubt me, do a web search of what countries we are bombing. The difference is that the countries we have been bombing for so long started off with military forces and capabilities far below that of Iran. In fact, in multiple cases, most notably Syria, Iran has been helping to combat the US-backed terrorist factions those countries have been contending with.

Many Americans want to claim that we have allies in the Middle East in the form of Israel and Saudi Arabia. There are a few big, big problems with that. Both of those countries buy their weapons from the US. Our weapons manufacturing capacity is at it’s limit. We have run out of bombs to drop on multiple occasions. Both of them gain the funds necessary to buy their weapons from the US. Saudi Arabia by oil sales, which Iran would block the shipment of if they were attacked. Israel is freely handed nearly $4 billion a year by the US. If we had an actual war with an actual opposing military, the US would have to stop handing out all that money. We are already responsible for over 1/3 of the global national debt and that amount keeps rising. So if they cannot buy weapons and/or we cannot produce enough weapons, any conflict with Iran would be over almost before it began. Iran produces weapons and buys weapons from Russia and China. We cannot stop that from happening. Russian and Chinese weapons manufacturing are nowhere near capacity.

For manpower and alliances in the immediate region, as I stated above, Iran has helped a number of countries in the Middle East. As those countries have been beating back terrorist groups, they have more manpower they could offer to help Iran. This is true even without leaving their own countries because US forces are in their countries or would attempt to occupy those countries in the event of conflict with Iran. All they have to do is evict our forces or turn on US forces in their countries. Not even kill anyone, just destroy our equipment and take our forces hostage. Think that can’t happen? Look at a map. Iraq and Afghanistan have been at war for nearly two decades because of American actions. Both countries have a majority that wants us gone. We have no forces in Pakistan and only a token illegal presence in Syria.

US forces are stretched to the point where we have had to send Coast Guard forces to other countries. That’s not the CG’s role. Their role is supposed to be guarding US waters. This, while we have yet to meet a maritime threat since WWII.

Trump has promoted the message that the US is a net oil exporter at this time. Note that precise wording. That we are a net oil exporter. That doesn’t mean we produce all the oil we need and more. Oil is one of our top three exports and top three imports. Now, consider that 2/3 of the world’s oil supply for export goes through the Strait of Hormuz, controlled by Iran. If they block oil transport, they bring most of the planet to a standstill. The US does not produce enough oil to meet our needs and that of other countries on a major scale. This would be even more true if major conflict erupted, meaning the military would requisition the remainder of our oil production.

That would open the door for Russia, the world’s third largest oil producer, to step in. It would also be a gain for Venezuela. Both would see massively increased oil and gas sales to other countries currently trading with Saudi Arabia, UAE and US.

Considering just how much the value of the US dollar is dependent on US and Saudi oil sales, military conflict with Iran would result in a massive decline in the value of the dollar in very short order.

Any conflict with Iran would result in the US even further threatening Russia and China, who trade with Iran. Especially China. It would at the very least offend and possibly anger the other nations that signed onto the JCPOA and have defended Iran’s compliance with that treaty, which the US has violated unilaterally. All these countries are not likely to simply accede to further threats and sanctions.

Even without military actions, US sanctions are actively resulting in loss of human lives in Iran (among other countries). Sanctions are acts of war. Sanctions kill. Sanctions also damage Iran’s trading partners economically. If you don’t understand all this and think sanctions are in any way peaceful, or that other countries go along with US sanctions without objection, do more research because it is something you do not understand.

Yes, Trump is extremely unstable. However, in this case the “Resistance” first criticized him for threatening Iran, while now criticizing him for not attacking Iran, no matter what dangers that action would result in.