1-7-13 RVpleaseToday: I think there is some confusion here, perhaps because the U.S. went into Iraq 10 years ago and things have changed a lot in the world over 10 years. As has been noted, the companies in the U.S. buy little oil from Iraq, around 500,000 barrels a day. Most of the foreign oil bought by U.S. companies comes from Canada and Mexico. These companies in various countries tend to buy from sources closest to them for obvious reasons. The U.S. government is not in the oil business. It is private companies buying the oil.
Iraq has recently noted that they are concerned about steadily falling demand for oil effecting their ability to maintain their budgets. The demand was much higher 10 years ago when we went into Iraq. But, time changes things. Everything that uses oil related products has gotten much more efficient. Alternate energy sources are growing all the time (the use of ethanol in motor fuels has skyrocketed over the last 10 years, for example), reducing the demand for oil worldwide. Because of this, OPEC has far less influence on oil prices then it did 10 years ago (much of the price of oil is being added because of speculators these days).
The thing to note here is that, while some countries are using more oil (China, for example), the U.S. is getting more efficient and sourcing oil from our region, not primarily from the Middle East. This reality changes the dynamic of a potential RV from what it might have been in 2003. But the most important thing to note is that neither the U.S. Government, nor the FED, nor the UST, is in the oil refining business.
They have no interest in buying barrels of oil, nor in loaning Iraq trillions of dollars for their oil, because they don’t buy unrefined oil in any substantial amount. It is private companies in the U.S. that buy oil. As I’ve said before, “oil for dollars” is a red herring where an RV is concerned. What we need is a stable, economically prosperous Iraq for the value of our Dinar to increase.