The current oil price is driven by fundamentals regardless of what the idiots on Capitol Hill believe.What would cause downward pressure on oil prices would be increased production.Iraq has the world's largest oil reserves(115 billion barrels) after Iran and Saudi Arabia.Many multinationals have started making progress on their projects in Iraq.Less number of US soldiers are being killed.I am not intending to discuss the moral part of this which is irrelevant from a financial standpoint.The government wants to increase production from 2.5 million barrels to 2.9 million barrels.If this happens how significant would it be for global oil supplies?Would Obama be able to sustain momentum which would be needed to make returns from these oil fields?Would the prospect of increasing oil production and lower fuel prices make Iraq invasion more palatable to the American public thus ensuring a stable US presence and increasing ROI?What are the chances of a civil war breaking out as most of the oil reserves are in the Kurdish areas and in the South?Most of the middle regions of Iraq have little oil.Iraq is 60% Shia which are centered around oil rich Basra,40% Shiite centered around Baghdad and the Kurds living in the oil rich North.With increasing wealth and disparity,there would be all the more reason to fight.But on the contrary they might think lets not kill the goose that lays the golden eggs,but then they could also think why not keep everything to ourselves.Does this mean one should go long the PPA ?
http://www.timesonline.co.uk/tol/comment/leading_article/article4244534.ece
