Thursday, June 05, 2008


The haggling between Israel and Syria is down to the options. The USA and Israel want the deal to include restrictions to the relationship between Syria and Iran. Syria has countered with the demand that Syria be given a small strip of coastline in the Sea of Galilee. The last time the Syrians controlled the Golan Heights they frequently shot missiles onto this stretch of coastline. Go back to the right point in the past 4,000 years and Syria can claim ownership of most of Israel. The above information came from the DEBKAfile. I have found the site to be reliable.

Syria has said it will refuse to allow the UN to inspect other possible nuclear sites. Iran has said the discussion over inspections is over. These hard lines are negotiating hooks. The world has agreed and signers to the NPT have agreed to allow UN inspections. It is a matter of time before some more leather seat type options are requested in exchange for full compliance with international rules. US negotiators have suggested that the next president will have to deal with these matters. Make no mistake that US negotiators very much want to conclude a deal, but they also must poster that they will not give away the store just to make a deal.

The 9 billion dollar investment Kuwait has made over the past several years is beginning to bear fruit. It's newest field will crank up this month with production of 50,000 barrels per day. Production is expected to rise as development continues over the next 8 years. At that point, this field will produce about a on million barrels per day. A million here and there adds up. Stratfor notes that Russia is trying to corner the European gas market by buying up the production of former Soviet States. It is amazing that natural gas was a nuisance during the first 70 or so years of oil production. Now, with pipelines being completed from here to there and back, it is expected that natural gas production is going to be a significant portion of the "energy solution". An American Gasoline Association estimates that the US has adequate natural gas supplies for the next 2,500 years. As soon as Iran makes its main deal, other deals will follow that will result in the transport of trillions of cubic meters of natural gas. At some point, someone will offer to split the difference. Leather seats should not be a deal breaker.