The 14 Words President Bush Just Uttered That Mark the End of the World as We Know it
Submitted by EnergyTechStocks.com
Some words make history. Last week President Bush, in a speech before the Economic Club of New York, uttered 14 words destined to be remembered. Asked about rising gasoline prices, the president replied in part, “Some nations have not done a very good job of maintaining their oil reserves.”
This is as clear an indication that a global oil supply crisis is imminent as any oil industry executive has yet said publicly. That it comes from an oil executive who has the very best intelligence – including, presumably, top secret reports on Russia and the national oil companies in OPEC – should make every investor wonder whether the truth is being hidden from them by these giant oil producers.
As the president well knows, it doesn’t matter how much oil is left in the ground if it can’t be produced fast enough to meet demand. No less an authority than Charles Maxwell, who as senior energy analyst at Weeden & Co. is today considered the “dean of oil analysts,” believes OPEC is guilty of over a quarter century of improper maintenance of its oil reserves. Maxwell told EnergyTechStocks.com’s managing editor in 2006 that during the 1970s OPEC nations’ decisions about oilfield maintenance became politicized and that money that should have gone into maintenance was (and continues to be) diverted by the politicians, who of course have covered up their actions, leaving the world ill-prepared for what Maxwell expects will be another great oil supply “shock.” (Read EnergyTechStocks.com’s 4-parter on the oil crisis Maxwell sees coming: ‘Dean of Oil Analysts’ Maxwell (4 Part Series).
President Bush said very specifically that some nations hadn’t done a very good job of maintaining their oil reserves either because of “bureaucracy” or because they are “state-owned enterprises.” The latter, of course, is a thinly-veiled reference to OPEC, while the former is just as thinly a veiled reference to Russia. In short, President Bush’s 14 words constitute an indictment of nine of the 10 countries with the most oil reserves as of 2006, the lone exception being Canada. (The U.S. and China ranked only 11th and 12th, respectively.)
Last week President Bush hinted strongly at what happens next. Emphasizing that there is no quick fix, he said Americans are in for a “difficult period,” a clear sign that the $4-a-gallon pump prices expected in the U.S. this summer will likely go a lot higher in succeeding summers, and that even if Americans cut back on their driving, other nations’ increasing numbers of motorists will keep global demand rocketing upward.
Investors should keep in mind that, no matter what OPEC and some Wall Street analysts might say, President Bush is certain that, as he put it last week, “Demand is greater than supply.” This sets the stage for rapid development of alternative transportation technologies such as battery-powered vehicles, which President Bush predicted last week will take hold “relatively quickly” in a major urban area such as New York City.
