Tuesday, November 25, 2014

Are Oil Prices dropping as a way to fight and defeat ISIL?

The previous article posits this position as one of the potential reasons for oil prices dropping like they are.

Do I agree with this assessment?

Yes, in some ways I do.

Imagine you are Saudi Arabia. You have many of your own people propping up ISIL with their oil money who are Sunni not only in Saudi Arabia but also throughout the oil driven Sunni nations of the Middle East.

How do you keep the Saudi Arabian Government in power through this kind of economic mess?

You harm the capacity not only of ISIL but of all people supporting ISIL economically throughout the middle east in order to maintain the present government of Saudi Arabia.

Otherwise, Saudi Arabia, Egypt, Turkey, Lebanon, Iraq, Syria, Iran and even Israel will all be gone at least as the government we know.

So, possibly the drop in oil prices is only all Middle Eastern Governments trying to fight ISIL and to stay in power as middle eastern governments, and is less about even Sunni Shia rivalries than we have previously thought?

There is one way to check all this.

If ISIL is defeated and becomes only a terrorist organization with no lands at all and the price of oil starts moving up then within the next few years, then we just might have all or part of our answer.

In the meantime all oil rich countries from Russia to Iran to the rest of the world and all the world's oil drillers and oil shale gatherers are in trouble unless ISIL is defeated pretty soon.

Here is the strangest statement of all. It is in Russia's financial interests to send troops or planes or drones to defeat ISIL too so the price of oil can return to something that will help the Russian economy and the Ruble.

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