Iraq: If Terrorists hit Southern Iraq oil fields, $5-$7 a gallon Gas?

[unhappycamper]

http://www.juancole.com/2014/08/terrorists-southern-gallon.html

Iraq: If Terrorists hit Southern Iraq oil fields, $5-$7 a gallon Gas?
By Juan Cole | Aug. 22, 2014

Iraq’s former oil minister, Ibrahim Bahr al-Ulum, warned on Thursday that the so-called “Islamic State” terrorist organization could hit the Iraqi oil fields in the south around Basra.

Basra is deep in the Shiite south, so IS could not take the city of 2 million as it did largely Sunni Mosul. But Bahr al-Ulum is pointing out that Basra’s oil fields and refineries are vulnerable to terrorism operations, i.e. bombings.

Brent crude oil futures have fallen about $10 a barrel in the past month, in part on economic news that China’s manufacturing sector is slowing.

~snip~

In the unlikely case that Iraq’s southern production were taken off line, that would put the price up to $150 or $200 a barrel (hence $5 a gallon or even twice that for gasoline). The world produces about 86 million barrels a day of liquid petroleum, not counting ethanol and biofuels. But prices are at about $102/ barrel for Brent crude only because of hydraulic fracturing in the US, which has brought over 2 million new barrels a day on line in the past 3 years. The loss of Iraq would wipe out that excess US production and send the price shooting up.

[glowing]

1. And that would be in pure speculation since there is

currently plenty of unrefined oil available... Some of it just sits in barges offshore so that it's "nowhere" while more oil is pumped out of the ground. It's disgusting! Another, "Thanks, Bush, for putting oil into the commodity market"!