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Oil's Well that Ends Well

John Kerry's victories in Tennesee and Kerry seem to mean nothing. Other than Wisconsin, if Edwards and Dean want to stick out, no state is going to give the Kerry man a knockout blow in the primary circuit. Bush is obviously girding, and happy to be facing the junior senator from Massachusetts. But more on that later. Just remember we told you first the race would distingrate into Dean-Kerry-Clark. Oops. Okay so I thought it would, Dean, Clark, and Edwards....

But the news that is a real shocker, and we don't mean the Martha Stewart Trial, is that OPEC apparently knows something we( meaning anyone who reads this thing) do not. The reason for this is that oil prices are generally not bought at the spot market. Nobody needs so little oil to buy it like you would an apple. But, if you want to read the tea leaves, consider that it has been a particularly cold winter in the East. The major refineries always have to consider how much oil to refine into heating oil and how much to refine into gasoline during the winter. As soon as the weather warms, up they must swtich out to a new form of gasoline. Combined with increasing travel during the start of spring March and April tend to be tight months for oil purchasing.

But you ask, why cut? Well the reason is going to surprise you. There are two separate hypothesis and both of them involve the Saudi Royal Family. The first is that OPEC fears Iraq's oil machinery may be operational soon. If that comes to pass, the cartels days could be numbered by flooding (no pun intended) the world with cheap oil. The other guess is that the devaluation of the dollar is hurting the Saudi economy (as they tend to keep a huge amount of their assets in US Dollars in American banks) and as a result, the "petro-dollars" are being devalued and need to readjust the balance of power within currencies. Of course, this also means that gas prices will rise. Of course, you might ask if this means something else. After all, the last cut was due to the appearance of an American-coached Iraqi oil minister in Vienna. However, the other thing to keep in mind is that gas prices have seldom broken the $3.00 mark in the US and if that happens during a long run up to summer production, it will be a sight to see.
posted by Thomas at 10:27 PM 0 comments

 
Fabian Tactics

During the Second Punic War, a great period elapsed between Hannibal's arrival in Italy and his expulsion after the landing of Gaius Aemilius Scipio in Carthage. The consul who had the best success against Hannibal's near guerilla style of war was Quintus Fabius Maximus Verucossus. Fabius would lead his troops to contain Hannibal, but never engage in full battle with him. His style of delay, containment made him the Roman version of George McClellan. And the strategy of delay has forever been called Fabian tactics.

If anyone though this is what the "Super Seven" would herald....I'm sure you knew John Kerry would win both New Hampshire and Iowa in December, right? But somehow, don't ask us how, it was Fabian tactics that won this day, but perhaps lost it for many candidates. John Kerry eliminated Joe Lieberman by running roughshod in Delaware...and quite frankly even if Joe had won convincingly the state only brings something like seven pledged delegates, along with the superdelegates. Instead, there was something particularly game afoot and it manifested itself as the night went on.

Howard Dean pulled his entire television ad machine off the air anticipating a showdown of sorts in Michigan, and Washington State. John Edwards stuck to concentrating on Southern states like Oklahoma and South Carolina, while Kerry attempted to hold Arizona and Missouri. North Dakota was seemingly forgotten...but crushing victories there and in Delaware made it seem that the day was Kerry's to lose. And while he hasn't lost it, it might be worse news than even he could imagine. You see, Kerry has often said his national strategy might avoid the South. Edwards's positive campaign worked well there, and left Kerry in second place (but still picking up a nice amount of delegates).

Kerry assumed that with Missouri in hand, and strong showings in Arizona and New Mexico...he would set his sights on the nomination. Except now he can't. Edwards looks like the Southern alternative to Kerry and nearly beat Wesley Clark for Oklahoma. Ironically all three men squeeze out nearly the same amount of delegates from the Sooner state, but the good showing has Edwards proclaiming that he's going to campaign to Michigan. An interesting development to be sure, but after Lieberman dropped out and Arizona went to Massachusetts, it appeared to be a footnote. And then the New Mexico caucus began. Kerry and Dean appeared to be in a very tough showdown with Clark and with Oklahoma still "too close to call" there was the thought that if either Clark or Dean had made a tough showing in New Mexico, the story would turn. Instead Kerry backers apparently persuaded enough people to choose him and give him a little less than half of New Mexico's delegates.

So there it was, victory at last for Kerry as he flew to Seattle to rally with the retiring Democrat governor, Gary Locke. Dean on the verge of defeat and Edwards barely able to slow down Mr. Heinz. But alas, that's not what's in the cards. Instead, the calendar tells us it's a rough ride for John K. Now that Edwards has enough momentum to attack Michigan, this allows Dean to take the state with a lower plurality (or Edwards can get it by Dean being there.) Even as a pal to big labor, Kerry appears in a tight spot. Also with Michigan highly contested, it opens the door for more aggressive Deaniac battles for Washington and Maine...a state that looks more like Vermont than New Hampshire did. Still, you would assume that if Kerry merely gets enough delegates out of February 7 the others will shrivel up and die. But sadly not so. Next week has Tennessee and Virginia going to the polls, with Nevada and DC that Saturday (the 14th) followed by Wisconsin the subsequent Tuesday( the 17th). Once you factor in Idaho, Utah, and Hawaii on February 24th...you realize that if Edwards merely takes the Southern States...Dean gets delegates this weekend and wins Wisconsin...then this race is going to last until at least Super Tuesday. In addition, unless one candidate wins then outright...there's a good chance the primary race will drag on.

After all the citizens of Rome voted Fabius out only to suffer two huge military defeats by Hannibal. So whichever candidate loses patience first might just tell us who will challenge Dubya come November.
posted by Thomas at 9:48 PM 0 comments