How Did We Not See This Coming?

[Last night I posted a diary on this topic.  It was not well-received, and I think I can clean it up a tad so as to make it more palatable.]

Yep. Some of our errant colleagues have met the Republicans, and my god is it hilarious to watch.

I can barely contain my glee as I see posters at RedState try as hard as they can not to slam Senator Clinton and her husband. It's not easy for some of them (they go on to thrash Senator Clinton at length), given that they've had a few decades to hold a grudge. Nothing wrong with that, it's their opinion (and its one of the things that makes us Democrats different from the Republicans).

But you've really got to read this. The Clinton supporters and the Redstaters are not getting along all that well indeed.

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Wright: Wright, wright or wright?

   Wright wright wright wright.  Wright, wright wright wright wright wright wright wright. Wright wright wright wright wright wright wright wright?  Wright wright wright, wright, wright, wright and wright.  Wright wright wright wright wright wright wright wright wright wright!

Wright wright wright wright.........

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Is the 'GOP party' just a FRONT?

Okay, I have already been called a nut so what do I have to lose, right?

Follow me on this one. I just was thinking, suppose the right is nervous that the long stranglehold they have had on politics is coming to an end. The middle class and poor of America have wised up and they realize that the extreme right is waging war on America that they know. They realize that there is a group of people who 1.) are commmitted to a militaristic, oligarchical America, one that takes from the poor and gives to them, i.e. (the rich) and one that is basically dishonest and doesn't care. and 2.) Has no qualms about doing ANYTHING to stay in power, even really really terrible things.

These are the people who have been in power for a long time, and even when they have been out of power (as during Bill Clintons Presidency) they are always there, still waging war and holding other kinds of power.

Well, the GOP 'brand' that many have associated with this movement has now been outed by the Bush fiasco as a taker and not a giver, as far as ordinary Americans are complained, and so they must feel that its time to change their skin.

How can they do this? Easy. The party name, like 'GOP' we see are front. Its for the outsiders. The insiders know this. They have a different organization. Their group has never been a party in a democracy. Its an antidemocratic idea and as such, it would repulse most Americans. But they have always been thre. Their ideas are a nebulous thing to outsiders who larely dont understand their goals. (Oligarchy, elitism, stability, GROWTH)

(This 'party' may also be international. Crossing national boundaries.) But the members of the group know each other when they see each other. they may even have a formal, but secret structure. Many people like, for example, Joe Lieberman and Obama, are members of that confederacy, just as the various GOP-branded members are.

The GOP party that we see, in other words, is just a FRONT ORGANIZATION to divert attention from the real leaders. Other parties might also be fronts.

The real leaders probably AVOID the limelight and they would never run for President, although they might serve as Vice President in a pinch.

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Why Edwards Is So Right About Iran

There have been those on this site that questioning my foreign affairs understanding and by extension, making my so called lack of understanding an example of Edwards "weakness" on Iran.  Let's take a look, shall we?

First, we have the idea that Iran has plenty of oil.  Well, they do.  In fact they are the world's second ranked domestic producer.  See here courtesy of the Energy Information Association:  http://www.eia.doe.gov/emeu/cabs/Iran/Ba ckground.html

Iran  
 Oil
Iran is OPEC's second-largest oil producer and the fourth-largest crude oil exporter in the world.  According to Oil and Gas Journal, Iran has 136 billion barrels of proven oil reserves, or roughly 10 percent of the world's total proven petroleum reserves as of January 1, 2007. Iran has 40 producing fields, 27 onshore and 13 offshore, with the majority of crude oil reserves located in the southwestern Khuzestan region near the Iraqi border. Iran's crude oil is generally medium in sulfur content and in the 28°-35° API range.

Iran is OPEC's second-largest producer after Saudi Arabia. In 2006, Iran produced an estimated 4.2 million barrels per day (bbl/d) of total liquids, of which 3.8 million bbl/d was crude oil, equal to 5 percent of global production.

Iran's oil consumption totaled 1.6 million bbl/d in 2006. The Iranian government heavily subsidizes the price of refined oil products which has contributed to increased domestic demand. Iran has limited refinery capacity to produce light fuels, and imports much of its gasoline supply. Iranian domestic oil demand is mainly for gasoline and automotive gasoils, but domestic demand for other oil products are declining due to the substitution of natural gas. However, it is an overall net petroleum products exporter due to large exports of residual fuel oil. Oil export revenues represent the majority of Iran's total exports earnings, but the country suffers from budget deficits due to a growing population and large government subsidies on gasoline and food products. In 2005, the International Monetary Fund (IMF) estimated that energy subsidies accounted for 12 percent of Iran's GDP, the highest rate in the world according to an International Energy Agency (IEA) study.

Iran produced 6 million bbl/d of crude oil in 1974, but has been unable to produce at that level since the 1979 revolution due to a combination of war, limited investment, sanctions, and a high rate of natural decline in Iran's mature oil fields. Iran's oil fields need structural upgrades including enhanced oil recovery (EOR) efforts such as natural gas injection. Iran's fields have a natural annual decline rate estimated at 8 percent onshore and 10 percent offshore, while current Iranian recovery rates are 24-27 percent, 10 percent less than the world average. It is estimated that 400,000-500,000 bbl/d of crude production is lost annually due to reservoir damage and decreases in existing oil deposits.  

So here we have information that sugest that what I say is true:  That Iran has plenty of oil, but perversely, has to import gasoline due to a lack of refining capacity.  Read further, and you will find an interesting fact:  Iran does indeed need foreign help to modernize its energy production, and to provide for its' people.

Upstream Projects

The Azadegan project phases I and II represent the greatest potential increase in Iranian crude oil production. Azadegan contains 26 billion barrels of proven crude oil reserves, but is geologically complex and difficult to extract. Iran and Venezuela have agreed on a $4 billion investment in the Ayacucho 7 block, where there are an estimated 31 billion barrels of oil. Iran's Northern Drilling Company (NDC) has also worked with Russia's Lukoil on oil field development in the Caspian Sea. (See Caspian Sea Analysis Brief)

Iran plans to increase oil production to over 5 million bbl/d by 2010, but it will need foreign help. According to Global Insight, an estimated $25-35 billion is required to meet the government's 5.8 million bbl/d target by 2015. Investment in Iran's energy sector has been tempered due to the election of the conservative government of President Mahmoud Ahmadinejad in 2005, the international controversy surrounding the Iranian uranium enrichment and nuclear program, and economic sanctions. According to the IEA 2007 Medium-Term Oil Market Report, Iran will not be able to increase its net expansion capacity through 2012.

U.S. Sanctions

U.S. sanctions against Iran due to Iran's historic support for international terrorism and its actions against non-belligerent shipping in the Persian Gulf impact the development of its petroleum sector.  According to the Iran Transactions Regulations, administered by the U.S. Department of Treasury's Office of Foreign Assets Control (OFAC), U.S. persons may not directly or indirectly trade, finance, or facilitate any goods, services or technology going to or from Iran, including goods, services or technology that would benefit the Iranian oil industry.  U.S. persons are also prohibited from entering into or approving any contract that includes the supervision, management or financing of the development of petroleum resources located in Iran.

Sector Organization

The state-owned National Iranian Oil Company (NIOC) is responsible for oil and gas production and exploration. The National Iranian South Oil Company (NISOC), a subsidiary of NIOC, accounts for 80 percent of local oil production covering the provinces of Khuzestan, Bushehr, Fars, and Kohkiluyeh va Boyer Ahamd. Though private ownership of upstream functions is prohibited under the Iranian constitution, the government has allowed for buyback contracts which allow international oil companies (IOCs) to enter exploration and development through an Iranian affiliate. The contractor receives a remuneration fee, usually an entitlement to oil or gas from the developed operation. In August 2007, President Mahmoud Ahmadinejad appointed NIOC executive Gholamhossein Nozari to serve as Acting Oil Minister, replacing Vaziri Hamaneh and creating controversy over President Ahmadinejad's role in the energy sector.

Exports

According to International Energy Agency's Monthly Oil Data Service and Global Trade Atlas, Iran's net crude and product exports in 2006 averaged 2.5 million bbl/d, primarily to Japan, China, India, South Korea, Italy, and other Organization for Economic Co-operation and Development (OECD) nations, making it the fourth-largest exporter of crude oil in the world. In 2006, Iran's oil export revenues amounted to $54 billion.

Export Terminals

Iran has the largest oil tanker fleet in the Middle East, the National Iranian Tanker Company, which holds 29 ships including Very Large Crude Carriers. Kharg Island is the country's largest terminal with a holding capacity of 16 million barrels of oil and a loading capacity of 5 million bbl/d, followed by Lavan Island with capacity to store 5 million barrels and loading capacity of 200,000 bbl/d. Other important terminals include Kish Island, Abadan and Bandar Mahshar, and Neka, which helps facilitate imports from the Caspian region. The Strait of Hormuz, on the southeastern coast of Iran, is an important route for oil exports from Iran and other Persian Gulf countries. (See Persian Gulf Analysis Brief) At its narrowest point the Strait of Hormuz is 34 miles wide, yet an estimated 17 million barrels, or roughly two-fifths of all seaborne traded oil, flows through the Strait daily. Iranian Heavy Crude Oil is Iran's largest crude export at 1.6 million bbl/d followed by Iranian Light at 1 million bbl/d.

Refining

Iran's total refinery capacity is 1.5 million bbl/d from nine refineries operated by the National Iranian Oil Refining and Distribution Company (NIORDC), a NIOC subsidiary. Iranian refineries are unable to keep pace with domestic demand, and face major infrastructure problems. The country plans to add around 985,000 bbl/d of refining capacity by 2012, mostly through expansions and upgrades for gasoline yields at the Bandar Abbas, Bushehr, and the 90-year-old Abadan refineries. Large expansion projects at Bandar Abbas, including new catalytic reformers, distillation units, and condensate splitters will help supply the domestic demand, but it will probably not all gasoline imports. Iran has also discussed joint ventures in Asia, including China, Indonesia, Malaysia, and Singapore to expand refining activity.

Pipelines

Iran has an expansive domestic oil network including 5 pipelines, and multiple international pipeline projects under consideration. Recently, an expansion of the 150 mile pipeline from the port of Neka on the Caspian coast to Rey, Tabriz, and Tehran refineries has reached a capacity of 300,000 bbl/d according to Global Insight. Iran has invested in its import capacity at the Caspian port to handle increased product shipments from Russia and Azerbaijan, and enable crude swaps with Turkmenistan and Kazakhstan. In the case of crude swaps, the oil from the Caspian is consumed domestically in Iran, and an equivalent amount of oil is produced for export through the Persian Gulf with a Swiss-trading arm of NIOC for a swap fee.

In 2006, Iran imported over 192,000 bbl/d of gasoline and relied upon imports to meet almost half of its fuel needs costing $5 billion. Gasoline

Iran is the second biggest gasoline importer in the world after the United States, consuming over 400,000 bbl/d. According to FACTS Global Energy, Iran imported over 192,000 bbl/d of gasoline in 2006 costing $5 billion. The gasoline consumption growth rate has averaged ten percent annually over the past six years, and the cost of imports is expected to reach $6 billion in 2007, up from $2.8 billion in 2005. Gasoline prices are heavily subsidized, and sold below the market price at around 42 cents per gallon, which has encouraged increased consumption. An increase in vehicle sales in recent years has also contributed to the problem. According to PFC Energy, car ownership in Iran grew 250 percent between 1990 and 2006, and a majority of these vehicles are older models. Gasoline powered vehicles in Iran are expected to reach 14.9 million by the end of 2007. Iran does not have sufficient refining capacity to meets its domestic gasoline and other light fuel needs. Therefore Iran imports gasoline from India, Turkmenistan, Azerbaijan, the Netherlands, France, Singapore, and the United Arab Emirates. Iran also imports from large, multinational wholesalers such as BP, Shell, Total, Vitol, LUKoil, and several Chinese companies.

Read:  Iran competes with the United States for gasoline imports.  Could that be the real reason we want sanctions?  

Continuing, perhaps a look at our future if we don't stop our own addiction to SUV's and the like:


New Gasoline Rationing System

In June 2007, the Iranian government instituted a gasoline rationing system. The decision followed a 25 percent price increase to 42 cents per gallon in May. NIORDC is responsible for the program which allows private cars to purchase 26 gallons per month and taxis to buy 211 gallons per month. The rations and increased costs are politically unpopular in Iran. Customers are allowed to purchase their ration six months in advance. Part-time taxis, commercial vehicles, and government vehicles also have special allowances. Records are maintained on smart cards, and later this year the government is expected to announce the price for gasoline bought beyond quota levels.

Iran's gasoline consumption dropped 30 percent immediately after the rationing scheme was adopted. NIOC executive, Hojjatollah Ghanimifard, stated that Iranian gasoline imports for August 2007 dropped 14 percent, although an additional $1.5 billion was requested by the Iranian Oil Ministry to increase gasoline imports through March 2008. The International Energy Agency reported in its August 2007 Oil Market Update that gasoline consumption will likely increase again due to the fact that Iran allows advance purchase of gasoline at a subsidized rate. The combination of rationing, price hikes, increased refining capacity, as well as compressed natural gas (CNG) production, will reduce Iranian gasoline import demand by an estimated 30,000 bbl/d in the next three years according to FACTS Global Energy.

October 2007

Contact Info
cabs@eia.doe.gov
(202)586-8800
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What the right thinks about 2008

Every once and awhile I look at Red State. I think it's good to know whats happening on both sides of the political spectrum. Well I was reading some of the comments and this one just struck me. Basically Hillary is the favorite candidate for the right and they are scared about Obama.

I think they underestimated Edwards. Also this shows why they still like Rotten Rudy. They think he can win. Ha! I hope he does get it the base hates it and a third party guy comes up like Nader did against Gore. But more. Maybe Alan Keyes because he has a history of beating Barack Obama big time. Read the entry after the break.

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Diaries

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