Tuesday, February 22, 2011

Libya's Big Impact

Well Gaddafi (Qaddafi, Kaddafi) has less control than I thought, and obviously is not paying his military men enough to ensure they stick to his side. This has a big impact on your gas bill. They export 1.5 mil barrels of oil a day. Not to us, mostly Italy, but to the world market. This forces everyone else to pick up the slack, which there is not a lot of slack right now. Supply taken away with the same demand will create higher prices. Gaddafi has supposedly ordered the refineries and other infrastucture destroyed. He is going scorched earth on Libya. This will probably end as badly as Egypt will end. I do not think Libya's tribalism would devolve the state into a super Somalia, but there will be quite the battle as the military guys start forming groups. Either the military will support a new General or Colonel who will give token reforms and spread the oil wealth around enough to pacify the people. Libya has a large sovereign wealth fund that they could use to alleviate the problems of their people instead of building palaces for the dear leader. A smart military leader would take advantage of that and pay off the proper military guys and tribal leaders to restore order. If not, we'll have a sham democracy where the Islamists get 'elected' and then rig it so only they win elections. Bad news world.

Please recall that Qaddafi was on of the UN Human Rights Council. I always support using natgas for car fuel. Let's use a fuel that relies less on unfriendlies and psychos.

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