Seeing Things

I fully admit that I am a conspiracy theorist.  I often see things that don’t exist…or at least don’t appear to exist to the general population.  Looking at world news I am beginning to see a theory form…and I wonder if I am going crazy, or if I am just that awesome.  (I concede that it is most likely that I am crazy).

Oil prices are plunging.  There are a few reasons for this.  One, the increase in US shale production has flooded the market with more supply.  Two, a global recession means less demand for oil.  But the biggest reason for the drop…OPEC refusing to cut production.  See, if OPEC cuts production than the oil surplus diminishes and prices go up again.  It is flat-out bad business for OPEC to continue its production levels.  So why are the doing it?

Here is where my crazy conspiracy riddled brain comes in.  First, lets start with Russia.  Putin has spent the last year doing nothing but pissing people off.  I don’t think it much of a stretch to say that the majority of the world wants that asshole to disappear.  (I hear there is this nice place the CIA runs in Poland).  Every time oil drops so does the ruble (currently one ruble is worth about 2 cents)…and Russia’s economy.  Economic collapse killed the USSR and will likely destroy Putin’s reign as well.  Putin’s corporate backers are losing money, big time. Between oil prices and sanctions…it won’t be much longer before they turn on him.

Still, that doesn’t really explain why OPEC would continue production.  Sure, OPEC countries have a reason to dislike Putin…but I am not sure they have enough of a vested interest to be persuaded to lose profit in order to oust him.  No doubt, the US has a very vested interest in seeing Putin disappear from the world stage.  The last thing we want is to see the rise of another Soviet Union and repeat the cold war.  Which is, ultimately, Putin’s goal.  Been there, done that, got the t-shirt.  Despite what some claim, the US still has high bargaining power around the world.  If anyone could convince OPEC to help destroy Putin economically, it would be the US.  But I still have a hard time seeing OPEC do so without receiving something in return.  So what does the US have to give that won’t piss people off…or at the very least, can be done covertly.

This is where the fun comes in.  First, Obama is smarter than many give him credit for.  Since this thing began with Putin I have seen him play the long game.  His goal has never been to simply get Russia out of Ukraine.  The goal was always to remove Putin from power entirely.  Now, there are a few ways this can be done.  Classically, we would either use an assassin or sponsor a coup.  However, that hasn’t worked out so well in the long run.  In fact, it has come to bite us in the ass more often than not (see: Cuba, Nicaragua, Iraq, Iran, Afghanistan…I could go on).  Then, there is collapsing the economy and letting nature take its course.  I believe this is what we are using and that is why in the beginning Obama was perceived as doing nothing.  It takes longer, but is generally more effective (see: USSR).

But it is a lot more than just destroying Putin.  Two of the biggest environmental (thus political) issues are fracking and the Keystone Pipeline.  Going up against big oil, when big oil holds most of Congress, is nigh impossible.  When the new Congress takes over next month, you can bet one of the first things they do is approve Keystone.  This is a bad thing, for a number of reasons that I won’t get into here.  Obama has made it clear that he opposes the pipeline.  But there is little he can do if Congress gives the OK.  Thus, the pipeline will be built.  Unless, of course, oil prices plummet and TransCanada can no longer afford to build it.  But that’s ridiculous because oil would have to fall to well below $80 a barrel for that to happen…oh, wait.

Also on the line with low oil prices is US shale production.  Sure, we want to see the US produce more and maybe ease our trade deficit…but is it worth the risk.  Shale oil is retrieved through a process called fracking.  This process is highly controversial and is quite possibly linked to an increase in earthquakes in high fracking areas.  There are quite literally, dozens of environmental concerns that surround this process…and enough scientific evidence to seriously question its safety and efficacy.  But you try getting big oil to listen to reason.  Of course, if prices dropped low enough and shale production was no longer cost-effective…

And this is what OPEC gets out of the deal.  It is really a win, win, win situation (except for a few oil companies…and Putin, but f&%* Putin).  OPEC gets to hedge out a few annoying new competitors increasing their profit margin when prices do go back up (and they will).  In return, the Obama administration can get a few political wins without actually getting political wins.  In other words, it gets what it wants (elimination of Keystone and fracking) without having to go through (oil owned) Congress and making it a big political fight.  Obama can then either claim the victory or (the more likely scenario) use plausible deniability.  Obama also gets a win by taking out Putin (which will happen when the Russian economy implodes).  Even though it may appear to the world that Obama did little to stop Putin, he will still get the political credit for Putin’s fall occurring during his tenure (see: Reagan/Gorbachev).

So, where does my third win come in?  Well, that’s us.  See, we all benefit from lower gas prices.  And when we spend less on gas, we spend more on crap.  When we spend more on crap, the economy gets a boost.  If the prices stay low long enough they will actually help the economy rebound, thus increasing demand for oil…and raising prices (another boon for OPEC).  But higher oil prices in a burgeoning and stable economy won’t hurt as bad as they have recently.  A strong and growing economy benefits everyone.  Also, Putin goes bye-bye and we get to watch his epic decline.  Bonus

So, long story short (too late), in my crazy-ass brain, the reason oil prices are so low are because the Obama administration made a clandestine deal with OPEC that will destroy Putin’s Russia, eliminate Keystone, and end (or at least greatly decrease) fracking in the US.  Plausible, yes. Probable, well..  In all honesty, this is something that is not beyond the realm of modern politics.  So, while it could be what is really going on, I fully admit that I could be crazy.  Maybe it’s true…or maybe I am just seeing things.