WikiLeaks Cables: Shell’s Grip on Nigeria Exposed

Related articles:

Wikileaks: A US Government Con Job

Nigeria: Halliburton Plans $500 Million Plea Bargain in Cheney Corruption Case!


US embassy cables reveal top executive’s claims that company ‘knows everything’ about key decisions in government ministries


Despite billions of dollars in oil revenue, 70% of people in Nigeria live below the poverty line. Photograph: George Osodi/AP

The oil giant Shell claimed it had inserted staff into all the main ministries of the Nigerian government, giving it access to politicians’ every move in the oil-rich Niger Delta, according to a leaked US diplomatic cable.

The company’s top executive in Nigeria told US diplomats that Shell had seconded employees to every relevant department and so knew “everything that was being done in those ministries”. She boasted that the Nigerian government had “forgotten” about the extent of Shell’s infiltration and was unaware of how much the company knew about its deliberations.

The cache of secret dispatches from Washington’s embassies in Africa also revealed that the Anglo-Dutch oil firm swapped intelligence with the US, in one case providing US diplomats with the names of Nigerian politicians it suspected of supporting militant activity, and requesting information from the US on whether the militants had acquired anti-aircraft missiles.

Other cables released tonight reveal:

US diplomats’ fear that Kenya could erupt in violence worse than that experienced after the 2008 election unless rampant government corruption is tackled.

America asked Uganda to let it know if its army intended to commit war crimes based on US intelligence – but did not try to prevent war crimes taking place.

Washington’s ambassador to the troubled African state of Eritrea described its president, Isaias Afwerki, as a cruel “unhinged dictator” whose regime was “one bullet away from implosion”.

Read moreWikiLeaks Cables: Shell’s Grip on Nigeria Exposed

Nigeria: Halliburton Plans $500 Million Plea Bargain in Cheney Corruption Case!

Related article:

Nigeria to Charge Dick Cheney in $180 Million Bribery Case, Issue Interpol Arrest Warrant

And now Halliburton is willing to pay $500 million to keep Darth Cheney from being arrested?


Nigerian officials say Cheney’s former company, Halliburton, is preparing to plea bargain.

Nigeria has filed corruption charges against former U.S. Vice President Dick Cheney. Cheney’s lawyer has dismissed the charges as “baseless.” (Tom Pennington/Getty Images)

LAGOS, Nigeria — Halliburton is planning to make a plea bargain in former U.S. Vice President Dick Cheney’s corruption case, Nigerian officials told GlobalPost.

Nigeria’s anti-corruption agency charged Cheney as the head of Halliburton when its engineering subsidiary, KBR, allegedly paid bribes totaling $180 million to secure contracts worth $6 billion.

KBR has admitted to bribing officials. Last year the company pleaded guilty in a U.S. federal court to paying the bribes to Nigerian officials prior to 2007, when it was a subsidiary of Halliburton. KBR, which is now independent from Halliburton, agreed to pay $597 million in fines, according to the Associated Press.

Cheney’s lawyer dismissed the new Nigerian charges as “entirely baseless.”

However, Halliburton is in talks with Nigerian officials to make a plea bargain in the case, said Femi Babafemi, spokesman for Nigeria’s Economic and Financial Crimes Commission, the agency which has pressed the charges against Cheney.

“The companies are asking for a plea bargain, we are reviewing their request, we are talking with them, but we have not gone far with the talks yet,” Babafemi told GlobalPost.

Although Babafemi did not give further details, other sources within the agency said the plea bargain might involve a $500 million settlement.

Read moreNigeria: Halliburton Plans $500 Million Plea Bargain in Cheney Corruption Case!

Nigeria to Charge Dick Cheney in $180 Million Bribery Case, Issue Interpol Arrest Warrant

Sure nothing will happen, but this is not because Interpol could not immediately arrest Dick Cheney:

Treason: Obama gives INTERPOL immunity from the Constitution (Amending Executive Order 12425):

So here’s the bottom line:

INTERPOL, an international law enforcement agency, has just been granted complete and utter “diplomatic immunity” within the borders of the United States, courtesy of Obama. They are not subject to any Constitutional limitations within the United States. Good luck filing for discovery, documents, witnesses or subpoenas against a police force that is operating outside of the Constitution in your own country! You can’t sue them. Their records can’t be searched. They are not subject to FOIA requests. You probably won’t even know the name of the agent prosecuting you if INTERPOL comes to visit. And they don’t have to tell you either.

And to track down Dick Cheney should be an easy task.


The energy services company Dick Cheney ran prior to becoming Vice President of the United States was atop the tongue of liberals each time it was awarded a contract in Iraq.

Now the company’s name, Halliburton, is being spoken somewhere else: Nigeria.

According to a story filed late Wednesday, Cheney will be indicted in a Nigerian bribery case as part of an investigation into an alleged $180 million bribery scandal.

“Last week, Nigeria arrested at least 23 officials from companies including Halliburton, Saipem, Technip and a former subsidiary of Panalpina Welttransport Holding AG in connection with alleged illegal payments to Nigerian officials. Those detained were all freed on bail on Nov. 29,” Bloomberg News’ Elisha Bala-Gbogbo wrote.

“Authorities in the West African nation are probing Halliburton, Saipem and Technip for the alleged payment of $180 million in bribes to win a $6 billion liquefied natural-gas contract,” Bala-Gbogbo added. “Panalpina is being investigated for illegal payments it allegedly made to Nigerian customs officials on behalf of Royal Dutch Shell Plc.”

The prosecuting counsel for the country’s Economic and Financial Crimes Commission said that indictments will be handed down in the next three days and that an arrest warrant for Cheney “will be issued and transmitted through Interpol.”

Read moreNigeria to Charge Dick Cheney in $180 Million Bribery Case, Issue Interpol Arrest Warrant

Nigeria Will Charges Against Dick Cheney in Bribery Scandal

Dec. 1 (Bloomberg) — Nigeria will file charges against former U.S. Vice President Dick Cheney and officials from five foreign companies including Halliburton Co. over a $180 million bribery scandal, a prosecutor at the anti-graft agency said.

Indictments will be lodged in a Nigerian court “in the next three days,” Godwin Obla, prosecuting counsel at the Economic and Financial Crimes Commission, said in an interview today at his office in Abuja, the capital. An arrest warrant for Cheney “will be issued and transmitted through Interpol,” the world’s biggest international police organization, he said.

Peter Long, Cheney’s spokesman, said he couldn’t immediately comment when contacted today and said he would respond later to an e-mailed request for comment.

Obla said charges will be filed against current and former chief executive officers of Halliburton, including Cheney, who was CEO from 1995 to 2000, and its former unit KBR Inc., based in Houston, Texas; Technip SA, Europe’s second-largest oilfield- services provider; Eni SpA, Italy’s biggest oil company; and Saipem Construction Co., a unit of Eni. Obla didn’t identify the former officials whom he said held office when the alleged bribes were paid.

Last week, Nigeria arrested at least 23 officials from companies including Halliburton, Saipem, Technip and a former subsidiary of Panalpina Welttransport Holding AG in connection with alleged illegal payments to Nigerian officials. Those detained were all freed on bail on Nov. 29.

Read moreNigeria Will Charges Against Dick Cheney in Bribery Scandal

Shell Ordered to Pay $48 Million Nigerian Bribe Fine

Royal Dutch Shell has been ordered to pay $48m (£29.4m) in civil and criminal fines over its contractor’s involvement in bribing Nigerian customs officials.


Shell and five other companies must pay $236m in criminal and civil penalties. Photo: GETTY IMAGES

The US Department of Justice hit the London-listed oil super-major with the penalty, after Panalpina, which was employed by Shell, agreed to plead guilty to taking bribes on behalf of its clients.

Panalpina, a major Swiss freight and logistics company, must pay $82m in fines after admitting to paying bribes to customs officials in at least seven countries including Nigeria, Brazil and Russia between 2002 and 2007.

Four of Panalpina’s other clients in addition to Shell were also fined, including Transocean, Tidewater, Pride International and Noble Corp.

“These companies resorted to lucrative arrangements behind the scenes to obtain phony paperwork and special favours, and they landed themselves squarely in investigators’ crosshairs,” said Robert Khuzami, the director of enforcement at the US Securities and Exchange Commission.

In total, the six companies must pay $236m in criminal and civil penalties.

Read moreShell Ordered to Pay $48 Million Nigerian Bribe Fine

Nigeria’s agony dwarfs the Gulf oil spill; The US and Europe totally ignore it

The Deepwater Horizon disaster caused headlines around the world, yet the people who live in the Niger delta have had to live with environmental catastrophes for decades

nigerias-agony-dwarfs-the-gulf-oil-spill_the-us-and-europe-totally-ignore-it
A ruptured pipeline burns in a Lagos suburb after an explosion in 2008 which killed at least 100 people. (Reuters)

We reached the edge of the oil spill near the Nigerian village of Otuegwe after a long hike through cassava plantations. Ahead of us lay swamp. We waded into the warm tropical water and began swimming, cameras and notebooks held above our heads. We could smell the oil long before we saw it – the stench of garage forecourts and rotting vegetation hanging thickly in the air.

The farther we travelled, the more nauseous it became. Soon we were swimming in pools of light Nigerian crude, the best-quality oil in the world. One of the many hundreds of 40-year-old pipelines that crisscross the Niger delta had corroded and spewed oil for several months.

Forest and farmland were now covered in a sheen of greasy oil. Drinking wells were polluted and people were distraught. No one knew how much oil had leaked. “We lost our nets, huts and fishing pots,” said Chief Promise, village leader of Otuegwe and our guide. “This is where we fished and farmed. We have lost our forest. We told Shell of the spill within days, but they did nothing for six months.”

That was the Niger delta a few years ago, where, according to Nigerian academics, writers and environment groups, oil companies have acted with such impunity and recklessness that much of the region has been devastated by leaks.

In fact, more oil is spilled from the delta’s network of terminals, pipes, pumping stations and oil platforms every year than has been lost in the Gulf of Mexico, the site of a major ecological catastrophe caused by oil that has poured from a leak triggered by the explosion that wrecked BP’s Deepwater Horizon rig last month.

Read moreNigeria’s agony dwarfs the Gulf oil spill; The US and Europe totally ignore it

The 21st-century African land grab by rich countries facing global food and water shortages

Highly recommended article.


An Observer investigation reveals how rich countries faced by a global food shortage now farm an area double the size of the UK to guarantee supplies for their citizens

the-21st-century-african-land-grab-by-rich-countries-faced-by-global-food-and-water-shortages
A woman tends vegetables at a giant Saudi-financed farm in Ethiopia.

We turned off the main road to Awassa, talked our way past security guards and drove a mile across empty land before we found what will soon be Ethiopia’s largest greenhouse. Nestling below an escarpment of the Rift Valley, the development is far from finished, but the plastic and steel structure already stretches over 20 hectares – the size of 20 football pitches.

The farm manager shows us millions of tomatoes, peppers and other vegetables being grown in 500m rows in computer controlled conditions. Spanish engineers are building the steel structure, Dutch technology minimises water use from two bore-holes and 1,000 women pick and pack 50 tonnes of food a day. Within 24 hours, it has been driven 200 miles to Addis Ababa and flown 1,000 miles to the shops and restaurants of Dubai, Jeddah and elsewhere in the Middle East.

Ethiopia is one of the hungriest countries in the world with more than 13 million people needing food aid, but paradoxically the government is offering at least 3m hectares of its most fertile land to rich countries and some of the world’s most wealthy individuals to export food for their own populations.

The 1,000 hectares of land which contain the Awassa greenhouses are leased for 99 years to a Saudi billionaire businessman, Ethiopian-born Sheikh Mohammed al-Amoudi, one of the 50 richest men in the world. His Saudi Star company plans to spend up to $2bn acquiring and developing 500,000 hectares of land in Ethiopia in the next few years. So far, it has bought four farms and is already growing wheat, rice, vegetables and flowers for the Saudi market. It expects eventually to employ more than 10,000 people.

But Ethiopia is only one of 20 or more African countries where land is being bought or leased for intensive agriculture on an immense scale in what may be the greatest change of ownership since the colonial era.

An Observer investigation estimates that up to 50m hectares of land – an area more than double the size of the UK – has been acquired in the last few years or is in the process of being negotiated by governments and wealthy investors working with state subsidies. The data used was collected by Grain, the International Institute for Environment and Development, the International Land Coalition, ActionAid and other non-governmental groups.

The land rush, which is still accelerating, has been triggered by the worldwide food shortages which followed the sharp oil price rises in 2008, growing water shortages and the European Union’s insistence that 10% of all transport fuel must come from plant-based biofuels by 2015.

Read moreThe 21st-century African land grab by rich countries facing global food and water shortages

US government lies about Flight 253 ‘crotch bomber’ patsy: Summary of the evidence; Yemen attack implication

Evidence Mounts for US Complicity in Terrorism (Veterans Today)


The US government who lied for wars in other resource-rich countries are lying about what happened on Delta Flight 253 with an alleged underwear/crotch bomber. Below is a summary of facts reported at this time, along with a 4-minute news interview from Webster Tarpley, followed by an extensive interview of Mr. Tarpley by Alex Jones.

The longer explanations of the following bullet points are in the reporting from Veterans Today editor Gordon Duff, US Intelligence Examiner Fred Burks, Prison Planet, 9-11 was an Inside Job, American Everyman Scott Creighton, and Citizens for Legitimate Government Lori Price.

Before the flight to the US:

  • Umar Farouk Abdulmutallab traveled to Yemen to meet with “terrorists.” However, his mother also lives in Yemen, which could also explain the visit.
  • The alleged terrorists in Yemen had been in Guantanamo Prison. They were released without trial by the Bush Administration even though they were reported as among the most dangerous detainees.
  • The government of Yemen reports that Islamic terrorists there have been arrested who have proven ties to Israeli intelligence.
  • Abdulmutallab’s father, though we are told is a retired “Nigerian banker,” ran their defense industry in close cooperation with Israeli Intelligence (Mossad).
  • Abdulmutallab’s father warned US embassy officials of his son’s dangerous behavior; this is corroborated with other US intelligence of warning.
  • Abdulmutallab’s visa to the US was never withdrawn, though he was on a “terrorist watchlist.” This would make his trip impossible unless protocol was ignored.
  • Flying from Nigeria, Abdulmutallab entered the Netherlands without passing through customs; impossible to do without assistance from an intelligence agency.
  • At the Amsterdam airport, Abdulmutallab was assisted by a man appearing to be Indian, who claimed Abdulmutallab was a Sudanese refugee with no passport (he would not have been allowed to enter the EU without a passport through customs). This man and whoever authorized boarding without a passport are huge stories we haven’t heard. Where is the airport videos of this?
  • Airport security in Amsterdam is contracted to an Israeli company with the most sophisticated technologies who had developed the concept of security profiling.

During the flight to the US:

  • Witnesses reported a man standing ten rows behind Abdulmutallab stand and use his camcorder to film the incident before it began. This important testimony was not pursued to discover the identity and role of this seemingly complicit person.
  • Witnesses report Abdulmutallab was oddly vacant and calm; typical of a programmed “Manchurian Candidate.” This might explain the behavior of the person filming: a “handler” who gave the code for Abdulmutallab to perform an act. Manchurian Candidates are now acknowledged historical fact. Research this if you are unfamiliar with the disclosed history.

After the flight:

Evidence Mounts for US Complicity in Terrorism (Veterans Today)

Obama is an elite puppet President like Bush.

Obama will be even worse than Bush!

Don’t miss:
US government lies about Flight 253 ‘crotch bomber’ patsy: Summary of the evidence; Yemen attack implication


COULD TERROR WAR BE RESPONSE BY GOP AND ISRAEL AGAINST THREATS TO THEIR GLOBAL PLANS?

dick-cheney-false-flag

When nothing adds up, its time we starting looking at what we know.  Our recent terrorist, now dubbed “the crotch bomber” is another dupe.  He could have been working for anyone, drugged, brainwashed or simply influenced, maybe by crazy Arabs, maybe by the Mossad, maybe by the CIA. We only know the game is falling apart.

We do know a couple of things.  Dad, back in Nigeria, ran the national arms industry (DICON) in partnership with Israel, in particular, the Mossad.  He was in daily contact with them.  They run everything in Nigeria, from arms production to counter-terrorism.  Though Islamic, Muttalab was a close associate of Israel.  He has been misrepresented.  His “banking” is a cover.  Next, what do we know about the two Al Qaeda leaders Bush had released, the ones who planned this?

According to ABC news, the Al Qaeda leaders running the insurgency in Yemen were released from Guantanamo, although two of the highest ranking known terrorist there, without trial.

Guantanamo prisoner #333, Muhamad Attik al-Harbi, and prisoner #372, Said Ali Shari, were sent to Saudi Arabia on Nov. 9, 2007, according to the Defense Department log of detainees who were released from American custody.

Both of the former Guantanamo detainees are described as military commanders and appear on a January, 2009 video along with the man described as the top leader of al Qaeda in Yemen, Abu Basir Naser al-Wahishi, formerly Osama bin Laden’s personal secretary.

With all the hoopla about trials in New York, not a word is said when top level terrorists are released to Saudi friends of the Bush family who let them go.  We are now fighting these two Bush friends in Yemen.  They are running a major insurgency there.  We have been using Cruise missiles and our jets to attack their bases in the last weeks.

CBS NEWS LEARNS CIA HAD ADVANCE INFORMATION ON DETROIT TERRORIST

CBS News has learned that as early as August of 2009 the Central Intelligence Agency was picking up information on a person of interest dubbed “The Nigerian,” suspected of meeting with “terrorist elements” in Yemen.

Sources tell CBS News “The Nigerian” has now turned out to be Umar Farouk Abdulmutallab. But that connection was not made when Abudulmutallab’s father went to the U.S. Embassy in Nigeria three months later, on November 19, 2009. It was then he expressed deep concerns to a CIA officer about his son’s ties to extremists in Yemen, a hotbed of al Qaeda activity.

THE CIA OFFICIAL STATEMENT

CIA admits broad information during the November interview, information not acted on in any responsible way but failed to understand that the terrorist they were warned of in November was the one they had been tracking since August.

We learned of him in November, when his father came to the U.S. embassy in Nigeria and sought help in finding him. We did not have his name before then,” said Paul Gimigliano, a CIA spokesman. “Also in November, we worked with the embassy to ensure he was in the government’s terrorist database – including mention of his possible extremist connections in Yemen. We also forwarded key biographical information about him to the National Counterterrorism Center.

CIA, ISRAEL AND YEMEN

It is claimed by groups claiming to be Al Qaeda in Yemen that the Detroit attack was in retaliation to US attacks on bases in Yemen run by Al Qaeda leaders released by Bush.

The government of Yemen, as reported in the BBC , says that the Al Qaeda terrorists, led by those released by Bush, are really Israeli agents though they have organized attacks against US targets:

Yemeni President Ali Abdullah Saleh has said the security forces have arrested a group of alleged Islamist militants linked to Israeli intelligence. Mr Saleh did not say what evidence had been found to show the group’s links with Israel, a regional enemy of Yemen. The arrests were connected with an attack on the US embassy in Sanaa last month which killed at least 18 people, official sources were quoted saying.

Read moreEvidence Mounts for US Complicity in Terrorism (Veterans Today)

Polio surge in Nigeria caused by mutated vaccine virus

polio_nigeria
A Nigerian schoolboy is vaccinated against polio during a mass nationwide polio inoculation April 12, 2005, in Kano, Nigeria.

LONDON—Polio, the dreaded paralyzing disease stamped out in the industrialized world, is spreading in Nigeria. And health officials say in some cases, it’s caused by the vaccine used to fight it.

In July, the World Health Organization issued a warning that this vaccine-spread virus might extend beyond Africa. So far, 124 Nigerian children have been paralyzed this year — about twice those afflicted in 2008.

The polio problem is just the latest challenge to global health authorities trying to convince wary citizens that vaccines can save them from dreaded disease. For years, myths have abounded about vaccines — that they were the Western world’s plan to sterilize Africans or give them AIDS. The sad polio reality fuels misguided fears and underscores the challenges authorities face using a flawed vaccine.

Nigeria and most other poor nations use an oral polio vaccine because it’s cheaper, easier, and protects entire communities.

But it is made from a live polio virus — albeit weakened — which carries a small risk of causing polio for every million or so doses given. In even rarer instances, the virus in the vaccine can mutate into a deadlier version that ignites new outbreaks.

The vaccine used in the United States and other Western nations is given in shots, which use a killed virus that cannot cause polio.

So when WHO officials discovered a polio outbreak in Nigeria was sparked by the polio vaccine itself, they assumed it would be easier to stop than a natural “wild” virus.

They were wrong.

Read morePolio surge in Nigeria caused by mutated vaccine virus

Nigeria militants threaten broader delta “oil war”

PORT HARCOURT, Nigeria (Reuters) – Nigerian militants threatened on Wednesday to broaden their “oil war” to offshore oilfields and announced attacks on a crude oil pipeline in the Niger Delta and another Shell-operated facility.

The Movement for the Emancipation of the Niger Delta (MEND), responsible for attacks that have cut a fifth of OPEC member Nigeria’s oil output, said it would launch attacks outside Rivers state for the first time since clashes began on Saturday.

Read moreNigeria militants threaten broader delta “oil war”

Codex Alimentarius: Population Control Under the Guise of Consumer Protection

This article is a must read.

Related video:
Nutricide – Criminalizing Natural Health, Vitamins, and Herbs
(Dr. Rima Laibow, M.D.)

__________________________________________________________________________

By: Dr. Gregory Damato, Ph.D.

(NaturalNews) Codeath (sorry, I meant Codex) Alimentarius, latin for Food Code, is a very misunderstood organization that most people (including nearly all U.S. congressmen) have never heard of, never mind understand the true reality of this extremely powerful trade organization. From the official Codex website (www.codexalimentarius.net) the altruistic purpose of this commission is in “protecting health of the consumers and ensuring fair trade practices in the food trade, and promoting coordination of all food standards work undertaken by international governmental and non-governmental organizations”. Codex is a joint venture regulated by the Food and Agricultural Organization (FAO) and World Health Organization (WHO).

Read moreCodex Alimentarius: Population Control Under the Guise of Consumer Protection

How China’s taking over Africa, and why the West should be VERY worried

This article is also another lesson in racism, which is always a sure sign of absolute ignorance, insecurity and low self-esteem, because racism is attempting to see other people as inferior, so that those “superior” racists can feel better about their wretched, unenlightened little life. ________________________________________________________________________________________

On June 5, 1873, in a letter to The Times, Sir Francis Galton, the cousin of Charles Darwin and a distinguished African explorer in his own right, outlined a daring (if by today’s standards utterly offensive) new method to ‘tame’ and colonise what was then known as the Dark Continent.

‘My proposal is to make the encouragement of Chinese settlements of Africa a part of our national policy, in the belief that the Chinese immigrants would not only maintain their position, but that they would multiply and their descendants supplant the inferior Negro race,’ wrote Galton.

‘I should expect that the African seaboard, now sparsely occupied by lazy, palavering savages, might in a few years be tenanted by industrious, order-loving Chinese, living either as a semidetached dependency of China, or else in perfect freedom under their own law.’


Close relations: Chinese President Hu Jintao accompanies Zimbabwe President Robert Mugabe to a ceremony in the Great Hall of the People in Beijing

Read moreHow China’s taking over Africa, and why the West should be VERY worried

Nigeria Issues Arrest Warrants for Top Pfizer Officials After Drug Experiments Conducted on Children

(NaturalNews) A Nigerian state judge has issued arrest warrants for three top Pfizer officials, saying that they failed to appear in court to face charges of illegally conducting drug trials that led to the deaths of 11 children.

Read moreNigeria Issues Arrest Warrants for Top Pfizer Officials After Drug Experiments Conducted on Children

Emerging markets face inflation meltdown


Downward spiral: Chinese stocks have slumped by almost 50pc since October while Mumbai’s BSE index has lost 27pc of its value

Central banks across much of Asia, Latin America, and Eastern Europe will soon have to jam on the breaks or risk a serious crisis as inflation spirals into the danger zone. As the stark reality becomes ever clearer, this year’s correction in emerging market bourses and bond markets has now accelerted into a full-fledged rout.

Shanghai’s composite index touched a fourteen-month low of 2,900 yesterday. It follows moves this week by the central bank raised reserve requirement yet again, draining a further $60bn from the banking system. Chinese stocks have now slumped by almost 50pc since peaking in October.

In India, Mumbai’s BSE index has lost 27pc of its value as the exodus of foreign funds accelerates. The central bank has raised rates to 8pc to curb inflation and halt a run on the rupee, but critics still say the country waited too long to tackle overheating. The current account deficit has shot up to near 3.5pc of GDP. A plethora of subsidies has pushed the budget deficit to 9pc of GDP.

Russia, Brazil, India, Vietnam, South Africa, Indonesia, Nigeria, and Chile – among others – have all had to raise interest rates or tighten monetary policy in recent days. Most are still behind the curve.

“The inflation genie is out of the bottle: easy money is the culprit,” said Joachim Fels, chief economist at Morgan Stanley.

“Weighted global interest rates are 4.3pc, while global inflation is above 5pc. The real policy rate in the world is negative,” he said
advertisement

The currencies of Korea, Thailand, the Philippines, and Malaysia have come under pressure this week as investors scramble for dollars in moves that echo the East Asia crisis in 1997-1998. Several countries have had to intervene to slow the currency slide.

The sudden shift in sentiment appears to follow comments by Ben Bernanke and Tim Geithner, the heads of the US Federal Reserve and the New York Fed, leaving no doubt that Washington has lost patience with the crumbling dollar.

It is almost unprecedented for Fed officials to take a public stand on the Greenback. The orchestrated move is clearly aimed at halting the vicious circle in the oil markets, where crude prices are feeding off dollar weakness – with multiples of leverage.

The “strong dollar” campaign has switched into high gear. US Treasury Secretary Hank Paulson has conducted an aggressive lobbying drive behind the scenes in the Middle East and Asia. America’s friends and foes have been left in no doubt that the enormous strategic might of the United States is now firmly behind the currency. From now on, they cross Washington at their peril.

The markets are now pricing in two rate rises by the Fed this year. Investors no longer doubt that the US – and Europe – will do what is needed to restore credibility. This display of resolve has suddenly switched the focus to the very different universe of emerging markets, where a host of countries have repeated the errors of the 1970s.

Richard Cookson, a strategist at HSBC, advises clients to slash their holdings in these regions.

“Inflation looks like a very real problem in Asia, and the risk is that investors will lose faith in the region’s currencies. Although markets have fallen savagely from their peaks, they’re still looking pricey. We’ re lopping exposure even further, to zero,” he said.

“Where to put the money? We think corporate debt is stunningly cheap compared with equities. Seven-year to ten-year ‘BBB’ [rated] corporate bonds in the US haven’t been this cheap since the Autumn of 2002,” he said.

“Until and unless policy makers in the emerging world – especially those in China – tighten policy dramatically, the inflation rates are unlikely to fall much. Our guess is that most don’t have much will to tighten pre-emptively,” he said.

Russia’s inflation is 15.1pc, yet interest rates are 10.75pc. Vietnam’s inflation is 25pc; rates are 12pc. Fitch Ratings has put the country on negative watch and warns of brewing trouble in the Ukraine, Kazakhstan, the Balkans, and the Baltic states. The long-held assumption that emerging markets are strong enough to shrug off US troubles is now facing a serious test. The World Bank has slashed its global growth forecast to 2.7pc this year. The IMF and the World Bank define growth below 3pc a “global recession”.

There is a dawning realization that China is facing a major storm as inflation (7.7pc), the rising yuan (up 5pc this year), soaring oil prices, and an economic downturn in the key export markets of North America and Europe all combine to crush profit margins. China uses five times as much energy as the US to produce a unit of GDP. It is acutely vulnerable to the energy crisis.

A quarter of the 800 shoe factories in the Guangdong region have shut down in recent months, and several thousand textile workshops are battling to stay afloat. Hong Kong’s industry federation has warned that 10,000 firms operating in the South of China may soon go out of business.

By Ambrose Evans-Pritchard
Last Updated: 13/06/2008

Source: Telegraph

IEA inquiry into whether oil supplies will run dry by 2012

The International Energy Agency has ordered an inquiry into whether the world could run out of oil in four years’ time, it was reported yesterday.

The IEA has concerns about what might happen in 2012, when demand for oil, boosted by the rapid growth of the Chinese and Indian economies, is expected to have reached 95 million barrels a day. Global supply at that point is projected at only 96 million barrels a day. Such a thin margin would be vulnerable to any sudden supply crisis in volatile countries such as Nigeria, Venezuela or Iraq, now estimated to have overtaken Saudi Arabia as the biggest oil nation.

The IEA said its inquiries would form part of short and long-term forecasts to be published in July and again in November. Its energy research chief, Lawrence Eagles, said: “Up to now we have believed that supply can cope with demand. One caveat is that we don’t know for certain whether estimates of reserves in countries such as Saudi Arabia are entirely accurate.”

John Waterlow, analyst at oil research consultancy Wood Mackenzie, commented: “Many oil-producing countries are closed, secretive societies where it can be difficult to pinpoint the level of provable reserves.”

The IEA’s inquiry follows last week’s new record high for black gold at $135 a barrel, fuelling inflation and possible world recession.

Read moreIEA inquiry into whether oil supplies will run dry by 2012

Gasoline May Soon Cost $10 a Gallon.

Big New Shock at the Pump Forecast by Two Analysts

Get ready for another economic shock of major proportions — a virtual doubling of prices at the gas pump to as much as $10 a gallon.

That’s the message from a couple of analytical energy industry trackers, both of whom, based on the surging oil prices, see considerably more pain at the pump than most drivers realize.

Gasoline nationally is in an accelerated upswing, having jumped to $3.58 a gallon from $3.50 in just the past week. In some parts of the country, including New York City and the West Coast, gas is already sporting a price tag above $4 a gallon. There was a pray-in at a Chevron station in San Francisco on Friday led by a minister asking God for cheaper gas, and an Arco gas station in San Mateo, Calif., has already raised its price to a sky-high $4.62.

Read moreGasoline May Soon Cost $10 a Gallon.

Crude oil at new high just under $114; gas also at a record

NEW YORK (AP) — Crude oil prices rose to within a penny of $114 a barrel Tuesday, setting a new record as concerns mounted about global supplies. U.S. retail gasoline and diesel prices also struck new highs.Traders honed in on a report by the International Energy Agency that said Russian oil production dropped this year for the first time in a decade. The report raised concerns about whether the key oil-producing nation will have enough supply to help feed growing global demand.

“In an emotionally driven market like we’ve got now, it just doesn’t take much in the way of a headline to prompt a psychological response,” said Jim Ritterbusch, president of Ritterbusch & Associates in Galena, Ill.

Read moreCrude oil at new high just under $114; gas also at a record