Opinion

The Great Debate

from The Great Debate UK:

Squandered oil wealth, an African tragedy

arvind ganesan-Arvind Ganesan is the Director of the Business and Human Rights Program at Human Rights Watch. The opinions expressed are his own.-

Equatorial Guinea is a tiny country of about half a million people on the west coast of Africa, but is the fourth-largest oil producer in sub-Saharan Africa.

Most of the investment in the country’s multi-billion dollar oil industry comes from the United States. ExxonMobil, Hess and Marathon are all there. Right now, the U.S. imports up to 100,000 barrels of oil a day from Equatorial Guinea, or about a quarter of the country’s oil production.

Oil money gives the country the means to be a model for development and human rights. The economy is nearly 130 times as big as it was when oil was discovered in 1995. But as a report released by Human Rights Watch today details, the government has squandered or stolen much of the money at the expense of its people.

It is a sad contrast, since the country has a per capita income comparable to Spain’s or Italy’s and development indicators more like Afghanistan’s. For just one sad example, infant and child mortality actually has increased -- from an already-dismal 103 deaths per thousand in 1990 to 124 per thousand in 2007. Similarly, under-5 mortality rates increased from 170 per thousand in 1990 to 206 per thousand in 2007.

from The Great Debate UK:

Wiwa v Shell: The day of reckoning

Ben Amunwa-Ben Amunwa is a campaigner with oil industry watchdog Platform, where he runs Remember Saro-Wiwa, a project that uses art and activism to raise awareness about the impact of the oil in the Niger Delta. The opinions expressed are his own.-

When the news broke of a settlement in the Wiwa v Shell case, a cacophony of responses soon flooded my inbox. Hailed as a victory for human rights by some, others felt disappointed that Shell could throw money in the face of justice. In such a high profile and emotive legal battle, holding oil giant Shell responsible for human rights abuses in Nigeria, including the execution of charismatic activist Ken Saro-Wiwa, hopes were inevitably high.

A settlement was always going to stir some controversy. Activists wanted to see Shell on trial for aiding and abetting the Nigerian military in crackdowns on the Ogoni people in the 1990s. Myself and many others travelled to New York expecting a trial, but came home empty-handed. Yet none of us had spent hours locked in settlement negotiations, nor lived with the burden of a 12-year litigation, not to mention the personal trauma of losing our loved ones to brutal violence. There is a growing consensus that the settlement is a victory in favor of the plaintiffs, and a step forward on the long road to corporate accountability.

Why final salary schemes are bad for you

REUTERS — Neil Collins is a Reuters columnist. The views expressed are his own –

So you’d like to work for BP? A fine company, recognisably the same business as half a century ago, and likely to be around in half a century’s time — yup, it’s a fine choice for a career.

It’s going to be an even better one for the ambitious twenty-something, because no-one joining after next March will be able to join its final salary scheme.

Develop domestic oil reserves for energy independence

 Diana Furchtgott-Roth– Diana Furchtgott-Roth, former chief economist at the U.S. Department of Labor, is a senior fellow at the Hudson Institute. The views expressed are her own. —

President Obama is in favor of moving towards “energy independence,” but his new 2010 Budget specifically seeks to raise taxes on domestic oil exploration by $31 billion over 10 years, a larger tax increase than on any other industry. In addition, oil and gas producers would bear a disproportionately heavy share of other tax increases on business, more than $320 billion.

Surely a president who desires energy independence would leave oil companies alone so that America could develop greater domestic reserves.  But this is not the case.

NYMEX oil benchmark again in question

John Kemp Great Debate– John Kemp is a Reuters columnist.  The views expressed are his own –

The record differential between the front-month and more liquid second-month contracts at expiry last week once again raised pointed questions about whether the NYMEX light sweet contract is serving as a good benchmark for the global oil market, or sending misleading signals about the state of supply and demand.

The expiring January 2009 contract ended down $2.35 on Friday at $33.87, while the more liquid February contract actually rose 69 cents to settle at $42.36 – an unprecedented contango from one month to the next of $8.49.

Will Obama raise fuel taxes?

John Kemp Great DebateJohn Kemp is a Reuters columnist. The views expressed are his own.

LONDON, Dec 8 (Reuters) – China’s decision on Friday to link domestic fuel prices to the international price of crude oil, but increase consumption taxes on gasoline and diesel sharply to spur more efficient use of energy in the medium term, raises the question whether the incoming Obama administration might be tempted to do the same.

China is taking advantage of a cyclical pull back in energy to push through a permanent structural increase in taxes and prices. The aim is to combine a short-term boost to the economy with longer-term and more consistent incentives for improving energy efficiency.

By consolidating a series of tolls and administrative charges into a single, easy to collect consumption tax, the government is simplifying the tax system, creating a new source of revenue, and ensuring the change will have no impact on the politically sensitive inflation rate.

Export window closes for U.S. oil refiners

John Kemp Great Debate– John Kemp is a Reuters columnist. The opinions expressed are his own –

U.S. oil refiners have relied heavily on exporting surplus gasoline and especially distillates to help offset plunging domestic demand over the last eighteen months.

Record product exports have averted a much deeper crisis within the industry, an even bigger collapse in gross margins and a huge inventory build.

Bleak outlook for U.S. oil refiners

John Kemp Great Debate– John Kemp is a Reuters columnist. The views expressed are his own –

Even by the standards of a deep-cyclical industry, the “golden age” of oil refining has proved remarkably brief, lasting no more than three years, before giving way to a new dark age.

Particularly in the United States, refiners have returned to the state of chronic unprofitability that plagued the industry before 2005.

Biofuels run into trouble

John Kemp Great Debate– John Kemp is a Reuters columnist. The opinions expressed are his own –

Despite a promising start, the U.S. experiment with renewable fuels is facing a serious challenge next year. Falling gasoline consumption, lower pump prices and contradictions within the federal government program are intensifying existing pressures on ethanol distillers and farmers already struggling to cope with over-capacity and collapsing margins.

ETHANOL ENTHUSIASM

Between 2000 and 2007, production of fuel ethanol quadrupled from 1.6 billion to 6.5 billion gallons, and the industry is on course to distill a record 9.3 billion gallons in 2008.

Ethanol production is not really economic at oil prices below about $60-70 per barrel (prices of grains and fats for ethanol conversion and processing costs are too high relative to oil). So the original boost to ethanol came from its use as an oxygenating additive in reformulated gasoline, rather than as fuel in its own right, when a number of states banned the use of MTBE.

from Global News Journal:

What should the world do about Somalia?

Islamist militants imposing a strict form of Islamic law are knocking on the doors of Somalia's capital, the country's president fears his government could collapse -- and now pirates have seized a super-tanker laden with crude oil heading to the United States from Saudi Arabia.

Chaos, conflict and humanitarian crises in Somalia are hardly new. It's a poor, dry nation where a million people live as refugees and 10,000 civilians have been killed in the Islamist-led insurgency of the last two years. A fledgling peace process looks fragile. Any hopes an international peacekeeping force will soon come to the rescue of a country that has become the epitome of anarchic violence are optimistic, at best.

But besides causing instability in the Horn of Africa, the turmoil onshore is spilling into the busy waters of the Gulf of Aden. The European Union and NATO have beefed up patrols of this key trade route linking Asia to Europe via the Suez Canal as more and more ships fall prey to piracy. Attacks off the coast of east Africa also threaten vital food aid deliveries to Somalia.

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