Peter Posted March 1, 2012 Share Posted March 1, 2012 Dennis wrote:The US is totally unprepared for a large urban strike. The food chain will collapse and people will panic.end quoteIt would be as bad or worse than 911 which completely shut America down for a day, though I seem to remember McDonalds and the grocery stores staying open. Post event security would be horrendous. Trucks were being pulled over and searched everywhere for months after the Twin Towers and Pentagon attacks. We must be better prepared and the creation of Homeland Security will prove how sensible its creation was, with new protocols in place in the event of what Obama calls, “a man made disaster.”On a lighter note than apocalypse, I don’t see how we can avoid being “in on” a strike against Iran. We WILL keep the Strait of Hormuz open, but the Iranians will try to mine it. It would take one tanker blowing up to cause a huge spike in prices, with a corresponding down turn in the world’s economies. Iran will attack our Fleet. Our Fleet as noted below will be cocked and loaded for Iranian grizzly bear. Without coordination with Israel we risk running into each other. Peter Taylor24/7 The Wall:Strait of HormuzAbout 20% of the crude oil produced in the world is shipped through the Strait of Hormuz, and Iran has threatened to shut down shipping traffic through the Strait. At its narrowest, the passage is 30 miles wide, so there is a realistic case that a conflict could close it. Iran has already been isolated as a trade partner by U.S. and EU sanctions. The regime in the country has made a number of threats about what it might do if its “national interests” were threatened. If Iran follows through with its threats, the period the passage is closed could be very brief if the U.S. Navy, which has a carrier group in the region, moved to reopen the lane. But it is not clear that the American government would make that decision without the open support of allies or the United Nations. A closure of the passage, or any escalation that would make a closure more likely, will drive oil prices higher — and Supply Risk In December 2011, OPEC members produced nearly 31 million barrels a day, cutting the cartel’s spare capacity capability from 3.18 million barrels per day to 2.85 million. Saudi Arabia accounts for 2.15 million of those daily barrels of spare capacity.Whether this data is accurate is arguable. What is not arguable is that starting to pump the spare capacity will take time, which will not be very helpful in the event that the Strait of Hormuz is closed or some other geopolitical risk is realized.Then there is Russia, the world’s first or second largest producer, depending on which day you look at the data. The OECD is counting on Russian production to make up for some of the short supplies and to grow by 1.4% to 10.72 million barrels a day in 2012. Russia grew its production by 1.2% in 2011. An additional gain of 17% in 2012 could signify that the OECD is hoping that Russian production can grow even more. There is no guarantee that Russia will deliver.Supply from Canada, the U.S., Australia and Brazil is expected to rise in 2012, though North Sea production is expected to fall. The OECD estimates global demand in 2012 of 90 million barrels a day and global supply essentially equal to projected supply. Nothing about that state of affairs should lead anyone to a conclusion that prices will fall. Link to comment Share on other sites More sharing options...
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