Earth Equity News

3 Oil-Rich Countries Face a Reckoning. By Simon Romero, Michael Slackman and Clifford J. Levy, NYTimes, October 21, 2008. "As the price of oil roared to ever higher levels in recent years, the leaders of Venezuela, Iran and Russia muscled their way onto the world stage, using checkbook diplomacy and, on occasion, intimidation. Now, plummeting oil prices are raising questions about whether the countries can sustain their spending -- and their bids to challenge United States hegemony. For all three nations, oil money was a means to an ideological end... But such ambitions are harder to finance when oil is at $74.25 a barrel, its closing price Monday in New York, than when it is at $147, its price as recently as three months ago. That is not to say that any of the countries is facing immediate economic disaster or will abandon long-held political goals. And the price of oil, still double what was considered high just a few years ago, could always shoot back up... Still... significant further drops could tip the three countries into deficit spending or at least force them to choose among priorities. A worldwide recession, which many economists say is likely, would worsen matters, dampening energy demand and holding down prices."