It's not Lukoil, its Iraqoil: The laundering of Iraqi oil

In a follow up to my market trends post this writer has done some research on the laundering of Iraqi oil. If you put Iraq and Lukoil in a Google search you'll find a wealth of information on Lukoil's drilling of the West Qurna-2 oil field. I'm sure anybody can't help noticing the prolferation of Lukoil stations as well as the drop in the price of oil. Oh, yeah just a reminder the war in Iraq was, in the words of GW Bush "For freedom".

What does this mean, well in essence the systematic laundering of Iraqi oil through a Russian company. Quite honestly a brilliant move. First off, many people think that Russia still has vast amounts of oil in Siberia, but in reality they don't. This misdirection works well in the favor of Western intrests. In the end our most hated economic monkey wrench, OPEC, is now in a position of less power and can't shape trends like they used to. Second this company is largely owned by, guess who? Good ole' Conoco Phillips.

What does this really tells us, well we are benefiting from the oil of Iraq. Accordingly, as the NYT printed on Tuesday Lukoil is being fined for not reaching deadlines on drilling schedules set for the interior of Russia and other locales. This tells me that a US company has set up shop in a Russian company to deflect oil supplies from direct US extraction. It's a great move, but how long will it last, well until investors stop making money and the publicity becomes too great, but bad publicity may never come due to the sleeping and co-opted nature of the US media. Smart business analysts would never say a word and know how to read between the lines, get inside info. and make tricky investment moves without a full disclosure of the oil laundering.

Why are we still in Iraq? Well I can tell you this much, it aint for freedom and democracy. It is about the oil, but oil as a economic and political tool. When used properly it will put OPEC into a corner for once. This can only last so long though, so one has to ask the question, what next? Iran? Maybe, with the Kin Jon Il situation Washington may be setting the public up for a no refusal stance for a nuclear Iran, especially in light of Korea's defiance. This would pretty much wrap up Syria, Hezbollah, and the PLO on supplies, but not necessarily the money, much of which comes from the Saudis. But with oil production in Iraq putting a strain on OPEC and the Saudis dominance on the Oil Market that money may have to be spent inside Saudi Arabia for their own problems, which in the future could be many. With Iran a bit more isolated an OPEC countries tyring to regain revenue this could be a possible outcome, however we don't have the military strength, unless the strategy is to recognize North Korea, pull the troops out and mobilize for war against Iran, hmmm, maybe.
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In the end this is what is really happening in the Middle East. Oil is a tool as well as a resource. Shaping trends in markets based upon geopolitcal events and longstanding trends. It's a dangerous game, and be careful to call the conflict in Iraq purely a civil war, this war is being formented by many different forces than just the sectarian. Keep your eyes peeled and keep a scorecard on other events outside the daily body count. This is happening for a reason and is no mistake and no mission of freedom. The only freedom here is the freedom to be plundered financially by Western states to stabilize markets, retread and get along with large scale geopolitical shifts and strategies.