Of course the war in Iraq is about oil. That is not rocket...

Of course the war in Iraq is about oil. That is not rocket science but I believe the average punter misses the point. The US saw its ability to extract oil (in US dollars also) from the Middle East being realistically compromised as this inevitable supply squeeze emerged. It made complete sense from a national interest perspective to then move on a nation in that area that had an unpopular dictator, with a comparatively small population and preferably a sheetload of oil! Just as China is now jostling in with Iran, Venezuala and it would like to think Canada (with their oil sands).

The prospect of globalisation is poor IF (some of us simply argue WHEN) oil prices continue to appreciate. I am a farmer and so in the business of commodity trading and I already have seen markets for grains such as lupins dry up to Europe simply because the freight liability of landing it in Rotterdam makes it uneconomical. Instead we as a collective marketing group must and continue to focus in on close regional markets such as Indonesia, Japan and China. Probably India too because farmers there were struggling to afford fertilizers for their crops before fertilizer prices essentially doubled in the last year (1L of oil to manufacture 1kg of urea). So I can see reduced food commodity volumes being produced in India. Globalisation assumes cheap energy! So I don't mean internationalism, I mean regionalism where freight advantages confer a permanent pressence in a marketplace. The higher oil and freight rates go the more concrete that pressence.

Your observation about Australia and its uranium reserves is completely correct. I have always said we are unwise to prevent the expansion of uranium sales out of this country. Besides we can help reduce the wasting of natural gas consumption on stationary energy demands. It doesn't pay to allow the global community you are a part of to endure pain if domestic politicing is occurring. Someone is going to get rather peeved.

But the US is playing a neat game at the moment! It is buying China's produce and the world's oil with 'i owe you's'. People think China has the upper hand over the US! But at the end of the day they are only holding paper, the US has accrued physical goods. If the sheet hits the fan ... why do you think gold has not genuinely taken off this time?