Despite having ancient seers (the “haruspices”) as ancestors, I don’t claim to be able to predict the future. But I think I can prepare for the future. So, let me try to propose a possible scenario for the new coming big thing that’s going to hit us.
Do you remember how many things changed during the past 2-3 years, and changed so unbelievably fast? There was a pattern in these changes: one element of the pattern was that we were told they were just temporary another that they were done for our sake. “Two weeks to flatten the curve,” and “the sanctions will cause the Russian economy to collapse in two weeks,” and many more things that were supposed to help us. Then, things would “return to normal” after a short time. Instead, they generated a “new normal” that was not at all like the old one.
Now, the obvious question is “what next?” More exactly, “what are they going to hit us with, next time?” There is this idea that there may be a new pandemic, a new virus, or the old one returning. But, no. They are smarter than that — so far they have always been one step, maybe two, ahead of us. They are masters of propaganda, they know that propaganda is all based on memes, and that memes have a finite lifetime. Old memes are like old newspapers, they are not interesting anymore. A particular bugaboo can’t scare people for too long and the idea of scaring us with a pandemic virus is past its usefulness stage. They may have probed us with the “monkeypox” pandemic and they saw that it didn’t work — it was obvious anyway. So, now what?
Let me suggest one possible new way to hit us. You may have heard of it, but so far it was supposed to be something marginal, not designed to create another “new normal.” But it may. It is huge, it is gigantic, it is arriving. It is the price cap on Russian oil. The idea is that a cartel of countries, mainly western ones, will agree on prohibiting the import of Russian oil, unless it is priced at less than $60 per barrel. It will also make it more difficult for Russia to export oil abroad even to countries which do not subscribe to the agreement.
This idea is, as usual, promoted as a way to help us. Not only it will harm the evil Putin, but it will reduce oil prices, and so everyone in the West should be happy. But will it actually work in this way? Unlikely, to say the least, and it is probable that the promoters know that very well.
Think about that: it had never happened during the past hundred years that a cartel of countries had intervened to force a certain oil price. Even during the famed “Oil Crisis” of the 1970s, the Organization of Petroleum Exporting Countries (OPEC) never did what it is often accused of having done, that is fixing a high oil price. OPEC can only set production quotas of sanction certain countries, but it has no power, and never had power, on prices, which are set by the international market.
It is known that when governments meddle with prices, the results are always bad. Typically, if the price set by the government is too low, that will give rise to a black market and it may make the goods disappear from the official market. It was a typical feature of the Soviet economy. Prices were fixed by the central government, and often were set at low levels to give the impression that certain goods were affordable. But it wasn’t so: theoretically, Soviet citizens could afford caviar sold at government-established prices. In practice, this caviar almost never existed in shops. But, of course, it was possible to find it in the black market if one could pay exorbitant prices for it.
Today, intervening to set a price for Russian oil is equivalent to throwing a wrench into the gears of a huge machine. Nobody knows exactly how the market is going to react. The only sure thing is that the Russians are refusing to submit and they won’t sell their oil to countries subscribing to the agreement. The overall result of having removed a major producer from the market can only be one: increasing oil prices. Exactly the opposite of what the price cap is supposed to do. But this is the very minimum that can happen: the effect of the cap are unpredictable on a market that’s already unstable and subjected to wild price oscillations.
Why did the Western countries engage in this apparently counterproductive idea? Well, there may be some method in this madness. I can think of a few possible explanations:
1. Western Governments are in the hands of idiots who don’t know what they are doing and act according to the principle known as “I ran naked into a cactus. Why? Because it looked like a good idea.” They put into practice ideas that look good (“harming Putin”), without worrying of the consequences (destroying the European economy).
2. The price cap has the specific purpose of raising oil prices. It will force consumer countries to switch from the relatively cheap Russian oil to the more expensive American oil, which will become even more expensive in a near monopoly regime. This will bring huge profits to American producers in terms of a major wealth transfer from Europe to the US.
3. The price cap is thought as a way to save the US tight oil industry, by now facing difficulties to continue producing while oil prices are declining in the world market. With higher oil prices, Europe will finance a new round of tight oil extraction, while the profits will remain in the US. It sounds diabolical, and maybe it is. Let me add that there may be a reason why the tight oil industry was recently declared as “dead” in the mainstream media. Call me a conspiracy theorist, but this article on “Oilprice.com” may have had the purpose of scaring the US producers and make them accept the riskuy measure of forbidding Russian oil from entering the Western market.
4. There may exist a “hidden force,” somewhere, that’s acting with a plan at the global level. The plan involves a forced reduction of fossil fuels production and consumption in order to mitigate the damage generated by global warming. The recent events, the Covid crisis and the Russian crisis, both have the effect of impoverishing some of the major consumers of fossil fuels, and so reduce consumption. The price cap on Russian oil may be just the first step of a new plan that will force Westerners to abandon their addiction to fossil fuels, whether they like it or not.
It may be that all four of these factors are at work. In any case, it is a powerful convergence of interests, likely to be successful in pushing the cap on Russian oil to worldwide acceptance. Considering how easily European citizens have been led to believe the most absurd things during the past two years, it is unlikely that they will realize what’s being done to them (and let me not use the appropriate words for the concept). Not that the American citizens will fare much better: the huge transfer of wealth from Europe to the US will go all in the pockets of the American oligarchs. As for the European governments, they are the structures that should oppose this giant theft, but they are staffed by traitors or idiots (or both), so they will enthusiastically adhere to the idea.
Is this what the crystal ball shows? Not necessarily. Let’s just say that there are reason to think that what I just described is a likely scenario. Then, the best-laid schemes of mice and men gang aft agley. There is a limit to how hard you can push something. Will European citizens continue forever to be happy to be beggared for their own good? Difficult to say. The only thing we can say is that the future is always full of surprises.
Originally appeared on The Seneca Effect Read More