Reply #6: BEST FRIEDMAN: If war goes well, $6 barrel oil, bad $60, Friday: $63

[yurbud]

He said a worse case scenario would be if war dragged on or Saddam attacked other countries oil fields.

One of those happened.

$6 or $60;

Thomas L. Friedman.
Jul 31, 2002

Reading the papers lately, I've lost track of whether the Pentagon plans to invade Iraq from three sides or four, and whether we will be using Jordan, Kuwait or Diego Garcia as our main launching pad. But one thing I haven't seen much planning for is the impact an attack on Iraq would have on the world's oil market. Depending on how the war went, that impact could be very bad and lead to a sharp spike in oil prices, like $60-a-barrel oil. But -- wait a minute -- it could also be very good, and lead to $6-a-barrel oil that would weaken OPEC and, maybe, also weaken the Arab autocrats who depend on high oil prices to finance their illegitimate regimes and buy off opponents.


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Let's start with the $60-a-barrel scenario. (The price today is in the mid-$20's.) While the Pentagon keeps leaking its war plans, no one ever writes about what Saddam's war plans might be. What if Saddam responds by firing Scuds with chemical or biological warheads at Saudi Arabian and Kuwaiti oilfields? The world market could lose not only Iraq's two million barrels a day, but millions more. And what if the war drags on and we have as much trouble finding Saddam as we've had finding Osama?