Gadaffi, Going, Going, G......?
Last October I posted some thoughts on the sanctity (or otherwise) of contracts, it is linked here.
I will shortly post some further thoughts and my own personal recollections of the Gadaffi years, but that can wait until he is actually gone. In considering his regime, and the first oil price shock it delivered, which almost brought the West to its knees, the entirety of that earlier posting bears reading in full, others may just wish to consider the following more relevant selective quotes:
In the post WWII years, world crude oil supplies were controlled by the seven "major" oil companies. These seven, sometimes known as the seven sisters, (five American, one British and one Anglo-Dutch) determined which new supplies be brought on stream and when to ensure adequate supply at fixed prices. In order to meet the desire of the larger oil producing states around the Persian/Arabian Gulf to have their national income grow at a reasonable rate, the major oil companies, unwilling to offer any price increases, committed to increasing their liftings from the main producing countries at an annual rate of six per cent.
(It is interesting to note, as a complete digression from my main point in this explanation, that these cheap and growing supplies of fixed price energy particularly aided the nations of Europe, the six Common Market Club members of which were at that time typically involved in endless quarrels over butter mountains, wine lakes and other pointless one upmanship and beggar my neighbour point scoring which they continue to this day. Economic growth was actually fuelled by all this fixed price oil flooding into the market, the paricular US major by which I was employed to seek homes for such supplies expanded its refining base in the late sixties in Europe from two to five oil refineries).
Such a cosy arrangement did not, of course, suit everyone; Colonel Gadaffi in Libya for one fumed at having large reservoirs of light, low sulphur crude oil locked beneath his deserts yet tantalisingly close to the lucrative European markets. Gadaffi brought in smaller but nevertheless international US oil companies (known as independents, typified by Occidental and Conoco) to develop his reserves and bring them to market.
As the monster Gadaffi became seems on the verge of falling, it is interesting to consider from the foregoing, was Gadaffi, at least initially not acting in the best interests of Libya, as he discerned them? Had King Idris, whom he replaced, been doing the same?
I will shortly post some further thoughts and my own personal recollections of the Gadaffi years, but that can wait until he is actually gone. In considering his regime, and the first oil price shock it delivered, which almost brought the West to its knees, the entirety of that earlier posting bears reading in full, others may just wish to consider the following more relevant selective quotes:
In the post WWII years, world crude oil supplies were controlled by the seven "major" oil companies. These seven, sometimes known as the seven sisters, (five American, one British and one Anglo-Dutch) determined which new supplies be brought on stream and when to ensure adequate supply at fixed prices. In order to meet the desire of the larger oil producing states around the Persian/Arabian Gulf to have their national income grow at a reasonable rate, the major oil companies, unwilling to offer any price increases, committed to increasing their liftings from the main producing countries at an annual rate of six per cent.
(It is interesting to note, as a complete digression from my main point in this explanation, that these cheap and growing supplies of fixed price energy particularly aided the nations of Europe, the six Common Market Club members of which were at that time typically involved in endless quarrels over butter mountains, wine lakes and other pointless one upmanship and beggar my neighbour point scoring which they continue to this day. Economic growth was actually fuelled by all this fixed price oil flooding into the market, the paricular US major by which I was employed to seek homes for such supplies expanded its refining base in the late sixties in Europe from two to five oil refineries).
Such a cosy arrangement did not, of course, suit everyone; Colonel Gadaffi in Libya for one fumed at having large reservoirs of light, low sulphur crude oil locked beneath his deserts yet tantalisingly close to the lucrative European markets. Gadaffi brought in smaller but nevertheless international US oil companies (known as independents, typified by Occidental and Conoco) to develop his reserves and bring them to market.
As the monster Gadaffi became seems on the verge of falling, it is interesting to consider from the foregoing, was Gadaffi, at least initially not acting in the best interests of Libya, as he discerned them? Had King Idris, whom he replaced, been doing the same?
Labels: Gadaffi
posted by Martin at 8:56 AM
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