Deep Doo-doo

[The Ronin]

http://www.comcast.net/News/INTERNATIONAL/...5bc5da026d.html

How do you think them oil markets will react to this on Tues? Guess what folks, you thought Sept 11 was bad, think again. Without the pretense of having my head in the sand, this storm is rising....and going right after my petroleum based employment. Hmmm, how da ya think 3 of them got away? I've read about the crusades, never thought I'd ever live to be in one.

 

[magsau]

This may actually cause the Saudis to engage the US for more assistance in protecting the Kingdom. Overall it may provide the US a military foothold again in SA and allow the Kingdom to reward us with better oil prices.

I have no lost love for the Saudis as they are not our friends. But if they need protection and we need oil then we might be able to work together.

 

[Busdrvr]

Ronin,
most estimates put the risk premium on a barrel of oil to be between $3-$8. The saudis pump approx 9 million barrels a day. If, say a terrorist action took out half of that capability, the US Strat oil reserve could make up the other half for approx 6 months. Interestingly, ANWR would likely provide 1.5 million B's a day, or 1/6th of the total Saudi production, within 5 years. It's too cold there for radicals....

 

[The Ronin]

Though I am certainly no expert, I think the west is only beginning to understand the issue. In an overly simplistic overview, haves and have not's, the Saudi's have funded and exported terrorism to that it could avoid exactly what is now occurring. But the burgeoning Islamic movement is moving into high gear. They know that they have no "military" option against the west. To hit and hurt the west, it has now turned its attention to the west's oil supply and those Arab moderates who do business with the infidels. Those select Arab moderates who have enjoyed prosperity from western relations are a very small minority. The poor Arabs are converting more and more of the middle income moderates as the west' decadence is becoming ever more prevalent. Just as we have become polarized over America's corporations, governmental polices and our lifestyles, the Arabs even more so as a whole, want to separate and stay separate from the west. The dissention even within the Saudi government lends extreme risks to all petroleum-based economies especially ours. The fundamentalist also are aware that not only do we not have the resources nor capabilities to handle emerging threats or theatres of operation, but it is draining our economy, in essence, a win-win. Time is on their side, so is there cause, and they know it.

 

[The Ronin]

In reference to the Strategic Oil Supplies, it's intention is for military use, not to prop up US oil markets. Its is also under-supplied as we speak. The current administration is actually buying oil to fill it. As far as the Alaska reserves, they are years from being able to provide additional oil supply. You have a better sense of the financial markets than I do, or at least more information and knowledge than I, but I think you will see a re-evaluation given the circumstances. DAL will go BK, UAL will not get its loan, there will be scaled down operations and lay-offs, U will go out of business and there will be more to come and the house of Saudi will not be as we know it. IMHO

 

[The Ronin]

http://www.comcast.net/News/BUSINESS//XML/...d00b1be301.html

The truth? Just Saudi spin in the works? One of their "elite" battalions on guard duty? Who knows....we shall see. Good thing Muhammad was born there or we'd really be in trouble, doubt if a WMD would ever be used, but who ever said there was reason with radicals? But bringing down the house of Saud and crippling America and the West at the same time sure has to make your rank and file fundementalist drool....or at least babble like a sheep hit with a cattle prod 😀

 

[iflyjetz]

The truth? Just Saudi spin in the works? One of their "elite" battalions on guard duty?

Ronin, reread the source's statement. He said that the elite guard was going to the province to protect those facilities. I suspect that it was carefully worded to be vague as to this elite guard's daily operations, which I doubt includes guarding people and buildings. muslims have a way of wording statements to make you believe what you want to believe.
The house of Al Saud is in danger of being overthrown if they do not eradicate this problem. I think that more drastic measures will be taken against muslim terrorists and anyone assisting those terrorists. You and I can only surmise the details of such measures, but amnesty international isn't going to be invited to visit the kingdom anytime soon. And don't expect any photos to be coming out of the elite guard's detention facilities.

 

[The Ronin]

The majority of terrorist’s on Sept 11 were Saudi nationals. What’s most disconcerting is to what extent are these types of feelings spreading. When I was there, I was treated either warmly or with non-interest. I certainly did not feel threatened. Also, this initial attempt wasn’t directed against the facilities, but upon the “softâ€￾ targets, more importantly non-Muslims and westerners in general. Hard targets are easier to defend than random acts of murder and violence. We will have to watch and wait to see to what extent the Saudi’s handle this, but for you and I whose jobs are influenced heavily by the petroleum industry, we and many others may yet become economic casualties before this is settled.

 

[Borescope]

How do you think them oil markets will react to this on Tues?

Oil Prices are up over 4% today to $41.50 a barrel in morning trading.

 

[The Ronin]

http://www.comcast.net/News/BUSINESS//XML/...581d31ad08.html

 

[The Ronin]

Fuel Costs Force Shakeout
Tuesday June 1, 3:47 pm ET
By Salim Haji


As gasoline prices remain high, the pressure on the airline industry continues to mount. Last week, Delta (NYSE: DAL - News) was reported to have hired the New York-based law firm Davis Polk & Wardwell for advice on restructuring its business. UAL (OTC BB: UALAQ.OB - News) also noted that fuel prices were the reason for the company's inability to turn an operating profit in April.
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Low-cost carriers were also hit. Frontier Airlines (Nasdaq: FRNT - News) reported fourth-quarter earnings on May 28 and cited high fuel costs for greater losses than Wall Street was expecting.

But higher fuel costs may actually end up being beneficial to the low-cost carriers like Frontier, Southwest Airlines (NYSE: LUV - News), JetBlue Airways (Nasdaq: JBLU - News), and AirTran (NYSE: AAI - News). As I have previously written, in my opinion it's just a matter of time before the low-cost carriers' superior business model dominates the industry. High fuel costs may be a powerful catalyst to speed up that process.

At a Bear Stearns conference on May 12, Frontier showed data on operating margins for the December quarter for a number of airlines. Southwest, Frontier, JetBlue, and AirTran were all more than 7%. On the other hand, traditional airlines such as Delta, United, and AMR (NYSE: AMR - News) all had significantly negative operating margins.

In addition, attempts by traditional airlines to pass the higher cost of fuel on to consumers are failing to stick. The latest attempt to increase fares, led by Continental Airlines (NYSE: CAL - News) a couple of weeks ago, was rolled back last week. Delta and Continental both commented that they were forced to roll back fare increases to "stay competitive." Last week's inability to increase fares was the third time in the last six months that a fare increase was attempted but quickly rescinded.

While higher fuel prices may be putting pressure on all airlines, on a relative basis, it is the weaker, traditional airlines with uncompetitive cost structures that are feeling more pain. In the long run, higher fuel costs may prove to be a great boost to overall industry profitability by accelerating the demise of the traditional airlines that have been able to hang on for longer than many had expected. Sustained higher fuel costs may force the much-needed industry shakeout to finally occur.

Planning a family vacation this summer? Log on to our Travel and Vacation discussion board for money-saving tips and for helpful answers to any questions you may have.

Fool contributor Salim Haji lives in Denver, Colo., and does not own shares in any of the companies mentioned.

Look...I found another "airline expert". These guys are everywhere....heck with so many....how did things EVER get screwed up

 

[Fly]

Fool contributor Salim Haji lives in Denver, Colo., and does not own shares in any of the companies mentioned.

Do you suppose this is the newest terrorist method. Just keep slamming them in the press until they fold? aarrgghhh, the terrorists are journalists!! 😉

 

[mweiss]

What a lovely racist comment. So anyone who has an arabic-sounding name is now a terrorist?

You probably thought it was funny. It's not. :angry: :down:

 

[Bear96]

What a lovely racist comment. So anyone who has an arabic-sounding name is now a terrorist?

You probably thought it was funny. It's not. :angry: :down:

I agree with Michael. That was totally inappropriate.

 

[JetClipper]

I'm not normally one to engage in these kind of discussions, but in this case, I'll make an exception.

The problem stems from the fact that some years ago the Saudi royal family made a deal with the devil (a.k.a. Islamic extremists) promising to make a very strict interpretation of Islam (I believe it's called Wahabism) the "national" religion of Saudi Arabia in return for the extremists' support. However, while publicly espousing Islam, when behind closed doors Saudi princes use oil money to fund a lifestyle so immoral it would make the Romans’ eyes water (e.g. drugs, prostitution, etc.). This dichotomy has not gone unnoticed by the extremists; add this to the growing divide between rich and poor in Saudi Arabia, and you’ve got all the ingredients for an Islamic revolution that will make 1979 Iran look like a dinner party.

The Saudi royal family, however, is not stupid. They know how much America relies on their oil, and take every opportunity to remind the government of this fact whenever Islamic extremism rears it’s ugly head inside Saudi borders. The recent statements that they will increase oil production to reduce prices are merely an attempt to gain additional support from the Bush administration. The fact that the U.S. helping the Saudis maintain their grip on power only feeds anti-American sentiment is of little concern to the royal family, though (as long as they’re not attacking us, who cares?).

So, essentially, the Saudi’s have us over a barrel (literally and figuratively). The only way we can loosen their grip (and thus defuse implications that the U.S.’ Middle East policy is based on oil), is to reduce our dependency on foreign oil by developing more U.S. sources and limiting consumption wherever possible.