This week, the Obama administration released a draft of its next five-year plan for offshore drilling—opening up a previously off-limits area along the Southeastern coast, from Virginia down to Georgia, as well as offering many new oil leases in the Gulf of Mexico. And while it would protect some key areas north of Alaska from drilling, it would open other Arctic areas up. The plan designates 9.8 million acres of Alaska's Beaufort and Chukchi seas off-limits to oil-and-gas leasing, and asks Congress to set aside 12 million acres in the Arctic National Wildlife Refuge (ANWR) as "wilderness area," affording another level of protection. Daily Caller is outraged that the Alaskan waters are to be off-limits; Grist is outraged that the Southeastern waters are to be opened up; Bloomberg tries to play it objective. However, read the small print last line of the White House memo on the supposedly new polcy: "Nothing in this withdrawal affects the rights under existing leases in the withdrawn areas."

As we noted in September (when the price had just dipped below $100 a barrel), after an initial price shock when ISIS seized northern Iraq, the world oil price has since slumped. It now stands at around $60 a barrel. Recall that way back in late 2001, when the US was invading Afghanistan, it stood at a lowly $11. At that time, we predicted an imminent price shock to jump-start the planned industry expansion—both in the Caspian Basin and here at home, overcoming environmental concerns. Boy, were we right. The price of a barrel first broke the $100 mark in 2008, and has frequently crossed it in the years since then, although it never quite hit the much-feared $200-a-barrel. But now the petro-oligarchs are talking like $100 may be the new $200. Saudi Arabia's oil minister Ali al-Naimi last month answered "we may not" when asked if markets would ever lift prices to $100 again. (CNN, Dec. 23) How much of this are we to believe, and what is really behind the slump?

The president of Colombia's Ecopetrol, Javier Genaro Gutiérrez, announced Sept. 24 that the state oil company will process licenses for the use of fracking technology. Gutiérrez upheld Texas as an example of successful fracking, saying, "I invite you to see the fracking tower next to a hospital for the elderly" in the US state. In the Ronda Colombia 2014, the country's latest round of auctioning oil leases on public lands, 19 of the 98 bids sold were for the development of fracking sites. In March, a law was passed to expedite the process for allowing "non-conventional" drilling sites. Ecopetrol in a partnership with Canadian-based Talisman Energy acquired the country's two largest natural gas fields from BP in 2010. 

We've long maintained that global oil prices are not determined by scarcity or even the laws of supply and demand so much as by politics—the price rises or falls in response to war or comparative stability in the Middle East. Oil fields don't have to actually go up in flames—the mere fear that this will happen is sufficient to drive up the price: it is about perception. We've also noted that the global petro-oligarchs are hoping to reap a windfall from the multiple global crises, plugging the North American energy boom as a key to security and low prices. But ultimately, high prices are needed to fuel continued expansion of the industry, whether in North America, the Arctic, Persian Gulf or Caspian Basin. So, to an extent, the global price is manipulated—we are alternately told that energy self-sufficiency is reducing reliance on unstable global markets, and that instability threatens our "way of life" so we had better loosen burdensome environmental restraints on new exploitation. At the moment, we are on the first part of the cycle: After an initial price shock when ISIS seized northern Iraq, prices have now stabilized, and we are being told it is thanks to domestic fracking and tar-sands oil. Soon enough (just you wait) they will be surging up again, especially if (as seems all too likely) the Middle East continues to escalate. This much is admitted in a Sept. 15 National Public Radio report, "With Turmoil Roiling Abroad, Why Aren't Oil Prices Bubbling Up?"...

Leaked e-mails between the leaders of Peru's Energy & Mines Ministry (MEM) and Environment Ministry (MINAM) reveal that Australia's Karoon Energy International provided "technical support" in the proposed reform of the Hydrocarbon Regulation that would eliminate requirement for an environmental impact study before oil exploration. In one e-mail. MEM chief Eleodoro Mayorga was directly reproached by MINAM head Manuel Pulgar Vidal for bringing Karoon into the process. This was among some 3,500 messages hacked by Anonymous Perú from the account of ex-prime minister René Cornejo, dubbed by the press "Cornejoleaks." Karoon has operations at Bloc 238 in the northern coastal department of Tumbes. (La Republica, Panorama via Celendin Libre, Aug. 12; Peru21, Aug. 11)

In a move being openly portrayed as part of a race with the US-backed Trans-Pacific Partnership (TPP) for hegemony in the Asia-Pacific region, China has set up a working group to study the feasibility of a Free Trade Area of the Asia Pacific (FTAAP). The proposal comes ahead of a meeting in May of trade ministers from the Asia Pacific Economic Cooperation (APEC) forum, which China will host. Wang Shouwen, an assistant commerce minister, assured: "We think there will be no conflict between the FTAAP and the region's other FTAs under discussion." But reports note that the news comes just as progress of the TPP has snagged over Japanese insistence on protecting its agricultural and automotive sectors. Chinese President Xi Jinping in October said at the APEC business forum in Indonesia that Beijing will "commit itself to building a trans-Pacific regional cooperation framework that benefits all parties"—an obvious veiled criticism of the TPP. (Tax News, May 5; AFP, April 30)

On April 9 the California-based technology company Hewlett-Packard (HP) announced that it was paying a $108 million fine to the US Justice Department and the US Securities and Exchange Commission (SEC) to end an investigation into subsidiaries in Poland, Russia and Mexico that allegedly paid bribes to officials. The HP subsidiaries "created a slush fund for bribe payments, set up an intricate web of shell companies and bank accounts to launder money, employed two sets of books to track bribe recipients, and used anonymous email accounts and prepaid mobile telephones to arrange covert meetings to hand over bags of cash," according to a statement by the Justice Department. HP said the corruption "was limited to a small number of people who are no longer employed by the company."

Coverage of Ukraine's newly inked deal with the International Monetary Fund is like the proverbial blind men and the elephant. Russia Today's headline is "Ukraine parliament passes austerity bill required by IMF," whereas the EU-aligned EurActiv put it: "IMF extends generous assistance to Ukraine." Forbes smarmily goes one better with "Ukraine Welcomes IMF Austerity Regime." RT tells us: "It is ordinary Ukrainians who will suffer the most under the new austerity measures as the floating national currency is likely to push up inflation, while spike in domestic gas prices will impact every household." But Reuters fleshes out the context for this a bit: "Moscow will not make it easy and Ukraine is already feeling some consequences from its break with Russia. Prime Minister Arseny Yatseniuk said...the price the country would pay for Russian gas, which accounts for over half of Ukrainian gas imports, would soar by almost 80 percent from April 1 as the seizure of Crimea had rendered a cheaper gas deal obsolete." So it seems that Russia as well as the IMF is imposing privation on Ukrainians, and is especially responsible for the spike in gas prices.