The Wall Street Journal reported last week that both India and China are increasing their reserves, and that will put upward pressure on prices.
India said it's more than tripling the size of its reserve from 39 million to 132 million barrels.
China's going to 500 million barrels from 103 million.
That'll add a nice 490 million barrels of global demand over the next few years...
Oh, and Iran's threatening to block the daily flow of 15 million barrels through the Strait of Hormuz. The
Telegraph notes the implications:
If the ayatollahs' carried out their threat, Iran could, at a stroke, choke the main artery for the West's energy supplies.
The Iranians have been planning for such an eventuality for the past twenty years. Unlike the late 1980s, the last time Iran seriously disrupted shipping passing through the Gulf, Iran now has the equipment, in terms of anti-ship missiles, to enforce the threat.
The U.S. Navy, which has two aircraft carrier groups permanently stationed in the area, would, of course, be forced to intervene, thereby leading to open hostilities between Washington and Tehran.
But if you think that is an alarming prospect, just imagine the mayhem that would erupt if Israel decided that it had had enough of Iran's prevarication over its nuclear program and decided to launch unilateral air strikes to knock out Iran's nuclear facilities.
