Over 60% of the world's oil reserves are in the Middle East and Egypt holds the keys to this region stability. Nobody knows for sure where this Street Revolution in the Wikileaks time will lead this nation, but one thing is clear that this fire could spread very fast and, as you can guess, Oil markets are controlled by not so democratic regimes in general with their own agenda. We will doubt that the health of western consumers will be the number one concern on their mind in the future.
This almost "perfect" Oil Demand Supply scenario from IEA on the chart above has accounted for "Crude Oil: fields to be found" - politically correct way to scream about Oil Shortage in the nearest future. Nobody was even thinking about any pressure - like Egypt eruption - on the world oil supply markets. We are not calling for panic now, but for how long can we continue to rely on the Oil map above to carry up our economies?
"Egypt on TV screens screams about Oil Age coming to an End - our recovery is too fragile to sustain the coming Oil Shock - we have the way out now and we can chose what to do next. At the certain level of Oil price all worries and concerns related to Electric Cars will be gone - you will be just happy to be able to drive."
Crowds swarm to clean energy cars as Mideast protests spur oil supply concerns
BY JIM REDDEN
The Portland Tribune, Jan 28, 2011
The real world intruded on the 2011 Portland International Auto Show when widespread protests erupted in Egypt just as the annual event opened at the Oregon Convention Center.
The possibility of reduced Mideast oil supplies added urgency to the daylong seminar on increasing the use of electric vehicles and plug-in hybrids that was held at the show on Friday.
One speaker, Sam Ori of the Electrification Coalition, said Portlanders already understand the need to reduce American dependence on foreign oil.
“What we need to do is sell EVs in cities other that Portland,” Ori told nearly 200 people at the EV Road Map 3 forum on the third floor of the center.
Proof of Ori’s claim was easily found on the lower two floors of the center, where 35 manufacturers were displaying around 400 new cars and trucks. People swarmed around the higher mileage vehicles, including the two all-electric Nissan Leafs making their first public appearances in Oregon.
Russell Vare, Nissan’s Regional EV Manager, found himself besieged with questions from potential buyers when he agreed to meet a reporter at one of the cars.
“I’m glad to tell people what they want to know, but I’m not a salesman,” said Vare, who was in town to participate in the forum."
Why Americans should care about what happens in Egypt
This weekend the country of Egypt faces a critical juncture as thousands of citizens protest the government of President Honsi Mubarak. There is a very real possibility of the protest movement turning into a full-scale revolution that brings about a new government in the country. The result of this weekends’ events will dramatically affect the lives of approximately 80 million human beings, which is reason enough to care about the story. Still, some may need some additional motivation to pay attention to what happens in Egypt. So, with no further delay, here are three reasons every American should care about Egypt.
The Suez Canal
The country of Egypt contains a crucial choke point for transportation called the Suez Canal. The canal connects the Mediterranean Sea to the Red Sea. Without the canal, ships are forced to go all the way around the southern tip of Africa. A significant amount of oil travels through the canal, and United States warships frequently are transported through the canal. Simply put, the canal holds vital economic and strategic importance. Over 60% of the world's known oil reserves are in the Middle East. The United States imports approximately 9 to 12 million barrels of oil each day just to keep up with the massive demand of the economy, and much of that oil comes through the Suez canal. At least one United States aircraft carrier fleet is always stationed in the area.
If the Egyptian government falls into chaos, it could endanger the continued operation of the canal. If the country is taken over by a government unfriendly to the United States, it could seriously endanger the ability of the United States to use the canal.
As stated above, the United States is still tremendously reliant on oil from the region. Yesterday crude oil prices spiked 4.3% on news of the unrest within in Egypt. The country of Egypt actually has very little crude oil reserves. The larger concern is that the Suez Canal could cut off transportation of crude oil from the region, or that the unrest spreads to other countries like Saudi Arabia that do have more oil. Many analysts believe the current protests in Egypt were inspired by those in Tunisia over the last month. The large-scale protest in Egypt may spur movements in other countries and cause instability in a region that is responsible for keeping American cars running. At the very least, the unrest in Egypt alone is likely to cause gas prices to rise over the next month.
Stability in the Middle East
As undemocratic as the country of Egypt may be, the United States has still viewed the nation as a source of stability in the relatively volatile Middle East over the last three decades. Egypt has a long-standing peace agreement with Israel. Egypt was supportive of the United States' first war in Iraq, and has been called a close ally in the United States' fight against terrorism in the region.
Under the best case scenario, the authoritative regime of Mubarak falls and a new, democratically-elected, peaceful government is installed in its place. However, the best case scenario may not unfold. In fact, history tells us that revolutions quite often result in an even worse government than that which was overthrown. A weaker government in Egypt may allow for a growing influence of terrorist groups within the country. Under the worst case scenario, an even more ruthless anti-Israel regime would take over - similar to what happened in Iran after the revolution in that country during the late 1970’s."