BBC - The Burden of "Black Gold"

[Fencer128]

Hi,

Here is the link.

I posted because it raises some questions I'd not considered before - mainly that there are possibly big negatives facing oil producing countries - such as Iraq - as well as positives. Let's hope it's all handled effectively.

Cheers,

Andy

 

[Alistar7]

All the postives outweigh the negatives.....


The charity's report finds developing countries dependent on oil have a higher incidence of these interconnected problems:


mass poverty
corruption
war or civil strife, and
dictatorial government


They had 4 out of 4, Saddam waged his own civil wars on his people.

I believe all those issues are being addressed and handled accordingly. It will be interesting to see if they "nationalize" the oil there as they do in Alaska.

 

[zephyrprime]

It will be interesting to see if they "nationalize" the oil there as they do in Alaska.

Political, ethical, and sociological issues aside, I think it makes sense to nationalize the oil fields for a purely economic reason.

A oil well can only output in 1 year a small fraction of the total amount of oil in the well. Suppose the oil well can only flow 1/50th of its oil per year. The well owner will not want to sell without getting a lot of money for the well but what company would be willing to pay even half the "oil worth" of the well if it means having to wait 25years to break even on their investment?

So if a person were to sell an oil well for a single one time fee, they'd probably only get a small fraction of the "oil worth" of the well. I don't really know if I'm right about this. It's just my musings on the issue.