One does not simply take a massively complex system like oil refining and jerk it about with sanctions and supply cuts without creating massive whiplash effects.
But this is what Europe has done with Russian oil and gas and the knock-on effects are going to be exceptionally painful and long-lasting.
For their part Saudi Arabia and the UAE have signaled to the world something we’ve long suspected; they haven’t actually got the spare capacity they always claimed they did. This is becoming more and more clear with every passing week when they fail to achieve their OPEC production targets.
Meanwhile, un-serious people in very serious positions are making incomprehensibly bad decisions and statements which reveal they are completely out of touch with energy and basic economic realities.
It really doesn’t get any more out-of-touch than this:
Unless we’re talking about Energy Secretary Granholm who – months into her role – had no idea how much oil the US consumed on a daily basis. Then it gets more out of touch. But the (supposed) president of the United States (or whoever sent it) being this ignorant of basic economics is really troubling.
Once you understand just how precarious the situation really is, and just how unserious the leadership of the west really are, then you can begin to internalize the depth of the predicament in which we have all been placed.
It’s bad folks.
by shawno