This is the final announcement for this most timely presentation on….
WINNERS AND LOSERS:
THE GEOPOLITICAL RAMIFICATIONS
OF THE RAPID DECLINE IN GLOBAL OIL PRICES
Dr. John Scire and Dr. Gerald O’Driscoll
The Ramada, Friday, January 29, 2016, 9:00 a.m.
The world is suddenly awash in oil and the global price of crude has rapidly declined. Dr. John Scire will discuss what the global and US oil situations were before Saudi Arabia and OPEC abandoned their quotas and increased production of crude oil, starting in the fall of 2014. He will look back at the predictions of where the price of oil would be by the fall of 2015, and why those predictions were way off (predictions of $65/barrel oil predominated). He will examine current projections for both oil production and price points for 2016, especially given that in the absence of a major conflict (e.g., Iran versus Saudi Arabia), there is little expectation for supply constraints or price surges. In fact, one respected observer said this:
As storage fills, prices can be expected to drop to a very low level–less than $10 per barrel for crude oil, and correspondingly low prices for the various types of oil products, such as gasoline, diesel, and asphalt. We can then expect to face a problem with debt defaults, failing banks, and failing governments (especially of oil exporters).”
Indeed, the glut of oil and rapid decline in global prices have unevenly impacted many countries already, including the U.S. Obviously, the more a nation depends on exports of crude oil for its wealth, the greater it has suffered; conversely, the more dependent a country is on imports to satisfy its oil requirements, the better they have done both economically and in terms of security issues. The United States has benefitted both from lower balance of payments deficits and the security implications of being less dependent on oil imports from volatile parts of the world. Domestically, however, some states have been winners—the major energy consuming ones—while major producers such as Alaska, Texas and North Dakota have suffered. Globally, the list of losers from low energy prices is long and growing—Iran, Venezuela, Russia and Saudi Arabia are all deep in the fiscal hole. China, in contrast, has been a major beneficiary, despite a slowing economy and growth rates (it could be worse—does the current Chinese economic decline suggest major structural weaknesses?)
Most importantly, even if oil were to rise to $65 a barrel, no major energy exporting country can restore fiscal balance at that point. Indeed, almost all are at risk for a severe fiscal crisis. Economic instability breeds political instability, and 2016 could be a “year of reckoning” for a number of nations—and that list is led by Saudi Arabia, Russia, Iran and Venezuela.
Dr. John Scire teaches US Energy Policy and US Foreign Policy at the University of Nevada, Reno. He has thirty years of military experience, first as a combat infantry officer in the Marine Corps, and then as a Psychological Warfare and Intelligence Specialist in the US Army Reserve. Dr. Gerald O’Driscoll is a senior fellow at the Cato Institute, and a recognized expert on international economic issues. He was formerly the Vice President and Director of Policy Analysis at Citigroup, and, before that, Vice President at the Federal Reserve Bank of Dallas.
Please join us for what will be a very interesting discussion. A full breakfast will be served ($15 Members, $25 Non-Members, and $10 for students with ID and military personnel in uniform; free for WWII Veterans). We recommend that you arrive by 8:30 to enjoy some breakfast, coffee and conversation.
You are encouraged to RSVP by clicking HERE. You may also RSVP by e-mailing firstname.lastname@example.org. Just a reminder, after the forum, we will be accepting new and renewal membership applications for the July 1, 2014 – June 30, 2015 period. Forms will be available at the forum, though you can also access the application form by clicking HERE. For your convenience, we accept cash, check and credit card payments for both the breakfast and membership fees.