I HOPE MICHELE BACHMANN WASN’T COUNTING ON LIBYA TO GET OIL TO $2

8/22/11

News this morning of the seemingly imminent fall of Tripoli to the Libyan rebels brought predictions of falling oil prices and, at least as of this morning, declines in oil futures. (See, inter alia, “Oil Prices Set to Slip if Rebels Win Libya,” Wall Street Journal, Monday, 8/22/11, page A6) Fortunately, there are more sober observers out there, cautioning that the victory has to be won, damage has to be fixed, and order has to be restored before Libya becomes the major factor in world oil markets it was only a few years ago; the aforementioned article reports that, as recently as 2009, Libya was exporting 1.5 million barrels a day and that it has the largest proven reserves in Africa. The latter surprised me; I would have guessed Nigeria had the largest proven reserves in Africa, but I digress. Optimists predict that Libyan oil production could reach 500,000 barrels per day in two months if everything goes right, and that would be consumed domestically. Given that the oil market is a global and, to an extent, fungible one, whether the oil is consumed domestically or exported should make little difference, but I digress again.

I, of course, am no optimist on either Libya or on its widely sought after oil. I predict chaos in Libya in the wake of Mr. Gadhafi’s overthrow and consequent long delays in bringing oil production back on. As loyal readers know, I predicted chaos in Egypt and that is precisely what we are seeing in the wake of Hosni Mubarak’s defenestration. Given that the struggle in Libya was exponentially greater than that in Egypt, and Mr. Gadhafi’s repression was greater, though perhaps not proportionally greater, than Mr. Mubarak’s, the chaos that should ensue in Libya should be more like that we are witnessing in Iraq and Afghanistan than that we are seeing in Egypt. Libya will become, to use the slightly modified vernacular, a defecatory product show.

These reports and predictions juxtapose nicely with a conversation I had at a family party yesterday with two very politically attuned (at least as much as yours truly) nephews and a similarly aware brother-in-law. I asked when American troops would show up on the ground in Libya. My conversation partners quickly picked up on my drift; American troops will soon find their way to Libya not to assure the overthrow of Gadhafi, which looked like a foregone conclusion by yesterday, but to “assure order” in the wake of his overthrow. Why do I think this will be the case? Because of the simple “You break it, you bought it principle.” Compound that with a European (only partially justifiable) attitude that they had the major role in the air campaign that aided Mr. Gadhafi’s overthrow and so now it’s our turn to restore order on the ground, the Europeans’ already having exhausted much of their military capacity and/or enthusiasm on the campaign (according to yesterday’s Chicago Tribune, the Danes and Norwegians were withdrawing fighter planes and the French and Italians were withdrawing their carriers DeGaulle and Garibaldi, respectively) even before these latest developments, and President Obama’s near Bushian enthusiasm for placating the defense industry by committing American blood and treasure in places in which our interests are at best tangential, and it’s hard to see how U.S. troops will not soon be patrolling the streets of Tripoli. Bear in mind that our military, even when stretched to the insane lengths our political leadership demands, is quite good at what militaries are designed to do: kill enemy troops and break their stuff. But our military is not at all good in doing what militaries are not designed to do: enforce our political leaderships’ vision of what a society ought to be.

And then there will be Syria…but that’s another post for another day.