Thursday, June 19, 2008

Windfall time

It's not autumn yet, but don't tell the Big Oil. The war in Iraq is finally paying some dividends, for some.

Exxon Mobil, Shell, Total and BP — the original partners in the Iraq Petroleum Company — along with Chevron and a number of smaller oil companies, are in talks with Iraq’s Oil Ministry for no-bid contracts to service Iraq’s largest fields, according to ministry officials, oil company officials and an American diplomat.
Key words: no-bid, future contract. Western big oil companies regain control over Iraqi oil field, mission accomplished. When will it be reflected in the pump price is another matter. The price: trillions of government spending and a couple thousand young man's life.

In the other news, China raises gas price today by about $0.6 a gallon, bringing it closer to the international price. The wealthy on the coastal regions are sure to complain, but the old price surely wasn't sustainable. In a way, China, given its world manufacturer status, was subsidizing the whole world. What it will entail on the inflation front is interesting to keep eyes on.

Stumble upon: One of the best analysis on China I read recently

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