Obama Blames High Gas Prices On Iran

March 26, 2012

USA Today

By David Jackson

“Obama is getting us ready with a war with Iran – now he is blaming them for high gas prices. Shouldn’t we be blaming companies like BP? Do they really need to be making all the money on in the world?” –KTRN

For all the domestic political talk about high gas prices, President Obama says one major factor can be traced overseas: Iran.

“Right now the key thing that is driving higher gas prices is actually the world’s oil markets and uncertainty about what’s going on in Iran and the Middle East,” Obama said in an interview with AAA. “And that’s adding a $20 or $30 premium to oil prices, and that affects obviously gas prices.”

Obama also cited Iran during his recent two-day western tour to discuss gas prices, and his “all-of-the-above” strategy that includes investment in new sources of energy.

“The main reason the gas prices are high right now is because people are worried about what’s happening with Iran,” Obama said in Oklahoma. “It doesn’t have to do with domestic oil production. It has to do with the oil markets looking and saying, you know what, if something happens there could be trouble and so we’re going to price oil higher just in case.”

One major worry: the prospect of an Israeli attack on Iran’s nuclear facilities, slowing the oil supply and spiking up prices even further.

Click here for the full report.

Iran Says “Gold is Money”

March 26, 2012

Activist Post

By Louis James

Economic crises signal that the current system isn’t working as expected and needs improvement. When it comes to monetary systems, questioning their fundamentals can lead to doubts about whether the preferred medium of exchange will continue to be preferred for long. The large-scale whirlwind of economic trouble around the globe has pushed some to rethink the role of gold in the economy – and to actually move toward bringing it back.

A month ago, a rumor that India is going to pay in gold for oil imported from sanction-struck Iran sent shockwaves through the markets. It was no small deal, both in principle and volume: India is one of Iran’s largest oil buyers, responsible for about 22 percent of total exports and worth about US$12 billion per year. China is next with 13 percent, and Japan is third with about ten. All of them are having a hard time dealing with Iranian oil imports, as the country is under sanctions caused by Western fears regarding its nuclear program.

Then an Israeli news site claimed exclusive knowledge of a possible workaround between India and Iran: settling the purchases in gold. Indian government officials refused to comment, which added to the speculation.

On the surface, the arrangement looked like a great way to settle the purchases via a stable medium: Iranian currency, the rial, is not widely used outside its border, and gold’s inherent anonymity would have provided a perfect way to avoid unnecessary attention from the global community. Ironically, it was precisely the fact that the settlement was planned in gold that attracted so much attention.

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Obama Flip-Flops On Keystone XL Pipeline

March 22, 2012

RT

By RT

“You mean Obama flip flops? Say it isn’t so.” –KTRN

Amid the skyrocketing US gas prices, President Obama is paying a visit to Cushing, Oklahoma which is home to America’s largest oil storage hub, to announce his new energy policy and to accelerate the construction of the Keystone XL pipeline.

Despite the heavy protests for the project that caused widespread outrage across the country due to environmental concerns, TransCanada is moving forward with plans to build the southern portion of the controversial Keystone XL pipeline.

According to The Huffington Post, Obama’s plan to “fast-track” the permit for the southern half of the pipeline has not been confirmed by Obama’s senior administration officials.

The proposed pipeline will go from Crushing, Oklahoma to the Gulf of Mexico to hopefully ease the price of the gas prices that have been hovering at approximately $4 per gallon.

TransCanada has released a statement saying”the President has previously voiced his support for the Gulf Coast Project and we agree as it will relieve the bottleneck in Cushing and allow American producers to transport their oil to the Gulf Coast to meet refinery demand.”

The company added that “along with relieving the bottleneck, refiners will have access to cheaper Canadian oil which should put downward pressure on US gas prices. The Gulf Coast Project also supports US energy independence by allowing Texas refineries to use American and Canadian crude oil instead of higher priced conflict oil from the Middle East and Venezuela.”

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Barack Obama Prepares for War Footing

March 20, 2012

Huffington Post

By Edwin Black

“Obama is getting ready for more war and he can’t wait.” –KTRN

Last Friday, March 16, President Barack Obama may have quietly placed the United States on a war preparedness footing, perhaps in anticipation of an outbreak of war between Israel, the West, and Iran. A newly-propounded Executive Order, titled “National Defense Resources Preparedness,” renews and updates the president’s power to take control of all civil energy supplies, including oil and natural gas, control and restrict all civil transportation, which is almost 97 percent dependent upon oil; and even provides the option to re-enable a draft in order to achieve both the military and non-military demands of the country, according to a simple reading of the text. The Executive Order was published on the White House website.

The timing of the Order — with little fanfare — could not be explained. Opinions among the very first bloggers on the purpose of the unexpected Executive Order run the gamut from the confused to the absurd. None focus on the obvious sudden need for such a pronouncement: oil and its potential for imminent interruption.

If Iran was struck by Israel or the West, or if Iran thought it might be struck, the Tehran regime has promised it would block the Strait of Hormuz, which would obstruct some 40 percent of the world’s seaborne oil, some twenty percent of the global supply, and about 20 percent of America’s daily needs. Moreover, Tehran has promised military retaliation against any nation it feels has harmed it. The United States is at the top of the list.

Blocking the Strait of Hormuz would create an international and economic calamity of unprecedented severity. Here are the crude realities. America uses approximately 19 to 20 million barrels of oil per day, almost half of which is imported. If we lose just 1 million barrels per day, or suffer the type of damage sustained from Hurricane Katrina, our government will open the Strategic Petroleum Reserve (SPR), which offers a mere six- to eight-week supply of unrefined crude oil. If we lose 1.5 million barrels per day, or approximately 7.5 percent, we will ask our allies in the 28-member International Energy Agency to open their SPRs and otherwise assist. If we lose 2 million barrels per day, or 10 percent, for a protracted period, government crisis monitors say the chaos will be so catastrophic, they cannot even model it. One government oil crisis source recently told me: “We cannot put a price tag on it. If it happens, just cash in your 401(k).”

Click here for the full report.

There Must Be War Before The Dollar Crash

March 19, 2012

Activist Post

By Rick Gedeon

Global stability remains precarious and will continue to deteriorate steadily as the dollar continues to lose sway as the global financial monolith.

India is being pressured by the US State Department (with staggering hubris) to reduce their oil procurement from Iran. America, a country with a population of 310 million, and consumer of 25% of total world oil production is commanding India, a country of 1.2 billion, to abate their oil imports under US demand.

They’re not even giving the courtesy of disguising their pretentiousness that goes along with international politics this time. This is being conducted unilaterally. Another way of putting it: “Because I say so! That’s why!” This could backfire drastically if India does the right thing and begins to make payment in bullion. The rest of the OPEC nations would likely follow suit and begin to exchange their black gold for shiny yellow gold. This would be the end of paper money around the world. Which in itself is not such a bad idea.

The Russians and the Chinese are getting irritated with this irrational American exuberance for WWIII. This is not actually what the American people want, but as former Vice President Dick Cheney once remarked in an interview with ABC’s Good Morning America, when the White House correspondent said polls show that two-thirds of Americans believe the war is not worth fighting, Cheney responded with a ‘so?’

On the other side of the globe, the Secretary of Defense [sic] Leon Panetta has pledged yet more American blood and treasure for plunder on behalf of Israel in case Israel engages in a war against Iran. Under the auspices of protecting American interests in the region of course.

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Amnesty International’s Ultimatum to Russia

March 16, 2012

Activist Post

By Tony Cartalucci

As Libya splinters into infighting factions, with racist genocidal death squads scouring “undesirables” across the nation, entire regions of the country peeling off as semi-autonomous terror-emirates and with a BP, Shell, and Total-funded Petroleum Institute chairman installed as “Prime Minister,” one can clearly see the tens of thousands of deaths brought about by the UN-sanctioned US-lead NATO campaign against the North African nation was an absolute failure. That is, if preserving innocent life was indeed its goal.

However, if the goal was to fracture the nation into ineffectual, infighting micro-states, while installing a proxy government in Tripoli to green-light contracts with Western corporations to plunder the nation’s national wealth, it was a resounding success.

However, clearly the world was deceived by the United Nations, the International Criminal Court, the United States government, the British and French governments, and of course NATO in the execution of their “responsibility to protect” mission. To allow a repeat of the vast criminality that has irreparably ravaged Libya would be unconscionable. Yet that is exactly what Amnesty International is demanding of the Russian Federation.

Click here for the full report.

Toxic Rapeseed And Other Low-Grade Oils With Additives Are Being Passed Off As Olive Oil

March 9, 2012

Natural News

By Jonathan Benson

“Olive Oil is one of the most healthy fats you can consume.  But make sure you’re getting the real thing.”  –KTRN

As much as 50 percent of the olive oil sold in the U.S. is not actually pure olive oil, as some brands claiming to be “extra-virgin” or “100 percent Italian,” for instance, have actually been adulterated with toxic rapeseed oil, more popularly known as canola oil, soybean oil, and other low-grade oils. In his new book Extra Virginity: The Sublime and Scandalous World of Olive Oil, olive oil expert Tom Mueller explains that not all olive oil is the same, and offers advice on how to spot authentic olive oil amidst all the imposters.

During a recent interview with Terry Gross from NPR’s Fresh Air, Mueller explains how olive oil adulteration is much more widespread than people think, if they are even aware of it at all. For olive oil to truly be considered “extra-virgin,” it has to come from fresh, crushed olives, and not be refined in any way or contain any chemical solvents. It also has to pass certain tests of integrity in order to be considered legitimate, for which many of the brands popularly sold today would fail.

“The legal definition simply says it has to pass certain chemical tests, and in a sensory way it has to taste and smell vaguely of fresh olives, because it’s a fruit, and have no faults,” said Mueller. “But many of the extra-virgin olive oils on our shelves today in America don’t clear [the legal definition].”

Real extra-virgin olive oil should have a vibrant, almost peppery flavor, for instance, and not taste bland or watered down. It is also typically stored in dark, glass bottles so that its array of health-promoting antioxidants, its taste, and its forceful green color — yes, olive oil should be green, not yellowish in color — are not harmed by light or damaging UV rays from the sun. For this reason, avoiding olive oil in clear, plastic bottles is recommended.

“What [real olive oil] gets you from a health perspective is a cocktail of 200-plus highly beneficial ingredients that explain why olive oil has been the heart of the Mediterranean diet,” added Mueller during his interview with NPR. “Bad olives have free radicals and impurities, and then you’ve lost that wonderful cocktail … that you get from fresh fruit, from real extra-virgin olive oil.”

Click here for the full report.

JIM ROGERS: The Government Is Lying About Inflation And It’s Crushing The Consumer

March 7, 2012

Business Insider

By Mamta Badkar

Business Insider recently spoke with commodities guru Jim Rogers about oil prices, gold, and the global economy. He also shared with us what life is like in Singapore.

This is the first of our multi-part interview with Rogers. Here, he offers his thoughts on commodities and the global economy.

What is feeding into oil prices at the moment?

Iran obviously, is one thing, but another is in the U.S. it’s the infrastructure problem. We have oil but it’s in the wrong places. On the east coast, they use imported oil, and imported oil is higher because of Iran. And it comes from Europe. North Sea production is in decline. There are supply-demand reasons that oil prices are high in many parts of the world. And known reserves of oil are in decline worldwide. And the IEA is going around telling people that known reserves are in a steady decline and we’re going to have a huge problem in a decade or two, a gigantic problem, unless somebody finds a lot of oil very quickly. So underneath the supply-demand, shorter term it’s infrastructure and Iran probably.

At what level do you think oil prices will break the back of the American recovery?

We are going to have a slowdown. Such is the staggering debt that America has, it has caused more and more of a drag on our economy. I would also point out to you that every four to six years we’ve had an economic slowdown in the U.S., since the beginning of time, so by 2012, 2013, 2014, we are well overdue for an economic slowdown for whatever reason. Whether it’s caused by high oil or what, we’re going to have a slowdown in the foreseeable future.

How do you see oil prices impacting consumers in emerging markets, especially in Asia, when many of them are struggling to rein in inflation and drive growth?

Everybody is paying higher prices for oil and that obviously impacts consumption everywhere and its not just oil, its food and everything else that’s going up. There’s inflation everywhere, the U.S. lies about it, I mean the U.S. government lies about inflation but there’s inflation everywhere. I mean I don’t know if you go shopping, but if you do, you know prices are up. The government says they’re not, I don’t know where they shop. Everybody else’s prices are up.

If you could own / invest in just one commodity which would it be?

I guess it would have to be one of the agricultural commodities, it would depend on which is down the most but it would be agriculture I can tell you that.

Click here for the full report.

BP Boosted By Oil Spill Settlement

March 5th, 2012

Raw Story

By: Reuters

Shares in BP are expected to rise 5-9 percent on Monday after the oil giant reached a settlement with businesses and individuals impacted by the Gulf of Mexico oil spill worth an estimated $7.8 billion.

Some analysts said the expected payout was less than they had forecast, reduced legal uncertainty and suggested the final settlement with BP’s biggest opponent – the U.S. government – would be much lower than the worst case scenario.

“On a trading basis we see a potentially quite positive reaction … BP moving to the 530-550 pence range near term (if not higher), and possibly higher thereafter,” said Jason Kenny, oil analyst at Santander.

BP shares closed at 496.5 pence on Friday.

Analysts had given a wide range of forecasts for how much BP would have to pay out to compensate fishermen, condominium owners and hoteliers, with many predicting a figure of $14 billion, although BP had taken a provision of just $6.1 billion.

The company has also taken a $3.5 billion provision for expected government fines but the maximum possible level of penalty could be over $20 billion, if BP is found to have been grossly negligent.

Analysts said the agreement boosted the chances of a settlement with the government.

“What this agreement does, if it is implemented, is to give the management of BP further encouragement to try and reach a settlement out of court (with the U.S. Department of Justice),” said Iain Armstrong, oil analyst with Brewin Dolphin, via email.

Fadel Gheit, oil analyst at Oppenheimer in New York, said BP’s hand had been strengthened by the deal.

“I think the settlement further weakens the government claim of gross negligence,” he said.

Analysts at Morgan Stanley predicted the agreement would allow BP to continue raising its dividend, which was cut at the height of the oil spill – the worst in U.S. history.

“We believe the path towards free cash flow of $8.7 billion and a dividend of 39 cents per share by 2014 remains intact,” the bank said in a research note.

BP paid a dividend of 29 cents per share for 2011. Some investors had feared BP’s ability to grow the dividend could be limited by the legal uncertainty.

Nontheless, even the most optimistic forecasts suggest BP will remain well below its pre-spill payout of 14 cents per share per quarter for years to come.

In addition to the U.S. federal government’s claims, BP faces lawsuits from the states affected by the spill, which came after a blast on a drilling rig that killed 11 men.

Analysts at Citigroup said they expected BP to have to pay another $1-2 billion to settle these claims.

For The Full Report Go To Raw Story

No Easy Fix for Gas Prices

March 5, 2012

321 Energy

By Peter Schiff

This month, as unleaded gasoline prices increased for 17 consecutive days (to a national average of $3.647 per gallon – up 11% thus far this year) and West Texas Intermediate crude joined Brent crude in breaking through a $100 per barrel level, energy prices emerged as a full blown political issue. While President Obama conveniently claimed that rising prices were the consequence of an improving economy (they’re not, and it isn’t) Republican fingers began to point sanctimoniously at current drilling policies. And while none of the accusers had any idea why prices were actually going up, the award for the most dangerous ‘solution’ must go to Bill O’Reilly at Fox News. The master of the “No Spin Zone” announced that high pump prices could be permanently brought down by a presidential order to restrict exports of refined gasoline. Not only does Mr. O’Reilly’s idea demonstrate contempt for the U.S. Constitution but it also displays a thorough lack of economic understanding.

Oil and gas prices are high now for a very simple reason: the U.S. Federal Reserve has gone on an unapologetic campaign to push up inflation and push down the value of the U.S. dollar. Just last week on CNBC James Bullard, the President of the Federal Reserve Bank of St. Louis, stated this unequivocally. What is somewhat overlooked is the degree to which an inflationary policy at home creates inflation abroad. Many countries who peg their currencies to the U.S. dollar need to follow suit with the Fed. As China, for example, prints yuan to keep it from appreciating against the dollar, prices rise in China. This is especially true for commodities like crude oil.

Many critics, such as Mr. O’Reilly, have relied on a limited understanding of the supply/demand dynamic to question why gas prices are currently so high at home. With domestic gasoline production at a multi-year high and domestic demand at a multi-year low, he logically expects low prices. But he fails to grasp the fact that the price of gasoline is set internationally and that U.S. factors are only a component.

O’Reilly’s loudly proclaimed solution is to limit the ability of U.S. refiners (and drillers) to export production abroad. If the energy stays at home, he argues, the increased supply would push down prices. Although O’Reilly professes to be a believer in free markets he argues that oil (and gasoline by extension) is really a natural resource that doesn’t belong to the energy companies, but to the “folks” on Main Street. What good would “drill baby drill” do for us, he argues, if all the production is simply shipped to China?

First off, the U.S. government has no authority whatsoever to determine to whom a company may or may not sell. This concept should be absolutely clear to anyone with at least a casual allegiance to free markets. In particular, the U.S. Constitution makes it explicit that export duties are prohibited. Furthermore, energy extracted from the ground, and produced by a private enterprise, is no more a public good than a chest of drawers that has been manufactured from a tree that grows on U.S soil. Frankly, this point from Mr. O’Reilly comes straight out of the Marxist handbook and in many ways mirrors the sentiments that have been championed by the Occupy Wall Street movement. When such ideas come from the supposed “right,” we should be very concerned.

But apart from the Constitutional and ideological concerns, the idea simply makes no economic sense.

In 2011 the United States ran a trade deficit of $558 billion. For now at least America has been able to reap huge benefits from the willingness of foreign producers to export to the U.S. without equal amounts of imports. China supplies us with low priced consumer goods and Saudi Arabia sells us vast quantities of oil. In return they take U.S. IOUs. Without their largesse, domestic prices for consumers would be much higher. How long they will continue to extend credit is anybody’s guess, but shutting off the spigots of one of our most valuable exports won’t help.

In recent years petroleum has become an increasingly large component of U.S. exports, partially filling the void left by our manufacturing output. According to the IMF, the U.S. exported $10.3 billion of oil products in 2001. By 2011, this figure had jumped nearly seven fold to more than $70 billion. How would our trading partners respond if we decided to deny them our gasoline?

Keeping more gasoline at home could hold down prices temporarily, but how much better off would the “folks” be if all the prices of Chinese made goods at Wal-Mart suddenly went up, or if such products completely disappeared from our shelves because the Chinese government decided to ban exports that they declared “belonged to the Chinese people?” What would happen to the price of energy here if Saudi Arabia made a similar decision with respect to their oil?

But most importantly, limiting the ability of U.S. energy companies to export abroad will do absolutely nothing to improve the American economy. As a result of our diminished purchasing power, American demand for oil has declined in relation to the growing demand abroad. Consequently, we are buying a continually lower percentage of the world’s energy output. Consumers in emerging markets can now afford to buy some of the production that used to be snapped up by Americans. If U.S. suppliers were limited to domestic customers, then prices could drop temporarily. But what would happen then?

With the U.S. adopting a protectionist stance, and with gasoline prices in the U.S. lower than in other parts of the world, less overseas crude would be sent to American refineries. At the same time lower prices at home would constrict profits for domestic suppliers who would then scale back production (and lay off workers). The resulting decrease in supply would send prices right back up, potentially higher than before. The only change would be that we would have hamstrung one of our few viable industrial sectors. (For more about how diminishing supplies could exert upward pressures on a variety of energy products, please see the article in the latest edition of my Global Investor newsletter).

Click here for the full report.

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