Do you enjoy being screwed?

Edward Taaffe
16 min readApr 5, 2022


For me there’s no nicer way to start a Sunday or any day for that matter, than a long slow grind of expresso, but I’m sure you’ll agree, it’s always important just who is doing it and why.

Right now you are being screwed, but the intentions are far from honourable, so am I and let me tell you, I’m not happy about it.

You could have guessed it if you dared so to do.

The history of how we got here is easy to tell and extremely intuitive. Half-way through, I could stop and you would guess the remainder.

“Strong U.S. consumption growth during the 1960s, coupled with decline in domestic crude output throughout the 1970s, increased the market power of oil exporters including OPEC.
Images of long lines at gas stations in the U.S. during the 1973–1974 oil embargo cemented a view of OPEC as an adversary among Americans.” Investopedia
Russia got a break for a short spell as the Arabs took the full focus.

Shell and Exxon sound the Global warming alarm.

“In 1982,, Exxon predicted that by about 2060, CO2 levels would reach around 560 parts per million — double the preindustrial level — and that this would push the planet’s average temperatures up by about 2°C over then-current levels (and even more compared to pre-industrial levels).

in 1988, an internal report by Shell projected similar effects but also found that CO2 could double even earlier, by 2030. Privately, these companies did not dispute the links between their products, global warming, and ecological calamity. On the contrary, their research confirmed the connections.”

Among the predictions back in 1988 were: 1 meter seal-level rises plus disintegration of the West Antarctic ice sheet resulting in a further 5 to 6 meters rise in sea-levels to completely cover many densely inhabited areas.

These reports were buried and only recently found their way into daylight under realistic scrutiny. What this tells us is that the oil industry was perfectly happy to destroy much of the known world for a few more decades of world domination and indeed that if anybody in governments were aware of this information, they were party to burying it. That’s not hard to believe given the lack of enthusiasm in 2022 with the evidence visible and the prognosis even more severe. Perhaps you can see some clues herein as to why a politician with his/her own very short-term goals might not feel so motivated to take on this problem.
“Jerry Taylor spent 23 years with the Cato Institute — one of those right wing think tanks — latterly as vice president. Before he left in 2014, he would regularly appear on TV and radio, insisting that the science of climate change was uncertain and there was no need to act. Now, he realises his arguments were based on a misinterpretation of the science, and he regrets the impact he’s had on the debate.

“For 25 years, climate sceptics like me made it a core matter of ideological identity that if you believe in climate change, then you are by definition a socialist. That is what climate sceptics have done.”

Who are OPEC+?

OPEC is Organization of the Petroleum Exporting Countries. Since my childhood, a time when this discussion was even more acute, OPEC and now the extended version of it known as OPEC+ have run a global cartel whose aim is to control production of oil in order to maintain a high price per barrel for its members and maximise their profits.

Many of us will innocently think that such market manipulation is illegal, but it is not, indeed nothing much is illegal on the international scene unless enough powerful countries decided to oppose it. Grabbing assets without evidence or warrant of any kind can even be acceptable, when enough military powers approve of it. That’s the extent of global law and order.

OPEC have a simple and logical goal. They maximise their returns on the resources in the ground beneath their countries by agreeing to limit production and hence cause the markets to bid up the price of oil.
Its simple enough for someone au fait with markets, but for others it is complicated. The price of oil is deemed to be set by a free market, i.e. buyers bid against each other for available supplies. Any shortage in supplies will in that case increase the price per barrel, therefore by controlling supply rather than by setting the price in a ledger, they achieve the same goal while making it appear to be a free market for oil.

The interesting bit though, is that oil at the retail end is also driven by that so-called free market, but oil as sold by producers is more often via a longer-term supply contract that does not fluctuate with the news and the breeze as spot markets do. The pump increases are very often just racketeering by retailers, but governments look the other way.

As oil has become scarcer and oil producers have developed complex expensive economies themselves and indeed the oil is in less accessible locations, often in harsh environments, the need for a high return is continually growing and hence they must drive prices higher while on the other hand, recession in many nations makes oil prices a cause of deeper recession that eventually drives down demand, thus defeating their efforts. It’s therefore, always a balancing act.

US v OPEC makes a return

As U.S. domestic output rebounded via development of shale resources from 2011, the rivalry with OPEC was renewed. When Saudi Arabia raised output in 2014, thus pushing down crude oil prices, it did so with the stated aim of reversing big recent gains in U.S. shale production on the basis that shale with its high costs is only profitable when prices per barrel are very high. Hence high prices suit the US and any other shale producers.

The Kyoto Protocol 1997

Developed nations gathered in Kyoto, Japan, to agree a plan for reduction of greenhouse gasses. They set a target of 5% reduction by 2012. The US senate ratified this treaty.

Global Day of Action 2005
In 2005, the first Global Day of Action took place during the UN climate talks in Montreal — with people taking part in Canada and around the world, from Bangladesh to Australia. The demonstrations have repeated every year since 2005.


By 2014, 837 institutions and investors had agreed policies of divestment from industries that created greenhouse gasses. Notably, only 13 were US-based.
The problem with divestment of course, is that it simply means the investment moving form one holder to another and while politically correct, it fixes little.

Direct action

Extinction Rebellion launched in London in May 2018 bringing London to a standstill and began targeting events like Fashion Week. One outcome was that marching in protest was criminalised in UK and civilian protesters were arrested and imprisoned.

OPEC Cartel 2017

The successful implementation of the 2017 pact between OPEC and non-OPEC countries (OPEC+) resulted in an agreement that took 1.8 million barrels of oil per day (b/d) out of the market, and this impact was compounded by unexpected supply issues in Libya, Nigeria and Venezuela.

US Sanctions on Iran 2018.
Major Asian states, notably Japan and South Korea (the fourth- and fifth-largest consumers of Iranian oil) also announced plans to eliminate purchases from Iran. China and India (the top two), and advised their refiners to prepare for a ‘drastic reduction’ of imports from Iran. I’m sure you can see what is going n here. JR would have been proud.

Benefits of higher prices for US oil producers

Saudi Arabia in 2018 increased production by around 400,000 b/d, while the United Arab Emirates and Kuwait raised theirs by 60,000 and 40,000 b/d respectively to meet the shortfall created by Iran’s exit. Then Saudi Arabia brought its production level down.
“At higher prices, a strong rebound of shale oil in the US will likely continue. The US Energy Information Administration forecasts total average US crude-oil production to increase from 10.68m b/d in 2018, up 1.3m b/d from 2017, to 11.7m b/d in 2019, making the US the largest crude-oil producer in the world”
Now I distinctly remember in my childhood when the US ceased to be an oil exporter and fought bitter battles with OPEC to break the price Cartel. The higher prices today however, make it profitable to extract oil that was previously unviable.

15-year-old Greta Thunberg
In August 2018, Thunberg staged a school strike, sitting alone outside the Swedish parliament to protest inaction on the climate crisis.

She urged leaders to take climate change seriously if they wanted children to study for their future sparking a global movement led by school students regularly striking on Fridays under the banner “Fridays for Future”, while Thunberg went on to be nominated for a Nobel Peace Prize after her viral speeches to politicians around the world.
We still see precious little in the talk department even, the thing they specialise in much less any sign of directed action.

US Sanctions on Russia 2022

We’ve all seen the consequences of these sanctions and the end is nowhere in sight, nor does anyone sane expect a resolution. Why might that be? Have you got it yet?

How oil prices impact budget deficits.
“According to the IMF’s forecasts in June 2018 that anticipate an oil price of US$70.23 in 2018 and US$68.99 in 2019, the Arab Gulf states will see their collective budget deficit decline from 5.5% of GDP in 2017 to 3.5% and 2.3% of GDP in 2018 and 2019 respectively. For Saudi Arabia, the fiscal deficit will likely be reduced beyond the government’s own target and register 3.8% of GDP, versus 6.7% of GDP outlined in the 2018 budget law. The Russian Ministry of Finance recently issued a budget amendment in which oil and gas revenues were expected to generate the equivalent of US$44.4bn in 2018, up from previous forecasts of US$8.5bn, which had been based on an average Urals crude price of US$40 per barrel. It now expects a budget surplus of 0.45% of GDP — its first surplus since 2011 — compared to original forecasts of a deficit of 1.3% of GDP. . . The sharp fall in oil prices since 2014, coupled with rising concerns about a ‘lower for longer oil price’, forced producers to adopt drastic fiscal-austerity measures, including a public-sector employment freeze, subsidy cuts, utility-price hikes (Bahrain, Iraq, Kuwait, Oman, Saudi Arabia) and currency devaluations (Azerbaijan, Iran, Kazakhstan, Nigeria, Russia), in order to stem the deterioration of public finances and stop the rapid depletion of foreign reserves”

The losers are those who depend on imports of oil

“Higher oil prices will hurt countries that remain heavily dependent on crude-oil imports. Those will see their current-account and fiscal positions worsen, their currencies weaken and inflation soar, which will threaten much-needed growth recovery. The Asia-Pacific region will be affected the most, as the region’s oil demand accounts for over 35% of the world’s total consumption. While China is the largest consumer, the exposure of other Asian countries to high oil prices remains elevated, notably in India, the Philippines and Vietnam. Cheap oil and continued reforms had helped these countries achieve higher rates of growth, rein in finances and improve standards of living over the last two years. The fear is that higher oil prices will threaten those achievements as countries will have to absorb a much larger crude-oil import bill and cope with the inflationary impact of oil prices on millions of poor people. Ahead of elections next year, India — which imports almost 80% of its oil — has warned about its high degree of sensitivity to oil prices.”

States delivering large and costly energy subsidies and social-welfare programmes will be under particular strain. In Indonesia, where approximately 20% of the government’s budget is spent on energy subsidies, the bill for subsidies will almost double, being expected to reach 163.5trn rupiah (US$11.4bn) in 2018, up from the original budget estimate of 94.5trn rupiah (US$6.7bn). Egypt, Jordan, Lebanon, Morocco and Tunisia have the biggest proportional subsidy schemes and will be hit very hard.
Turkey already has a currency crisis and the oil crisis will be devastating

China accounts for almost 10% of global oil consumption: in April 2018, China imported around 9.6m b/d at a cost of US$768m per day, or US$280bn per year

For the US there is still a dependency on imports and the impact of higher oil prices, wherever its produced is potentially damaging to the economy. If shale producers can quickly up production they can balance some of this, but quickly is rarely a word you associate with oil production. There are however projects that were abandoned on viability issues.

NEWS ALERT March 2, 2022, 1:07 p.m. EST: Crude oil prices hit $110 on Wednesday, their highest level since 2013. Read it

3% of global GDP is oil production

This makes oil the worlds most important commodity. Its part in the cost of everything we consume from growing or production to distribution and of course disposing of waste, not to mention, shhhhh! The cost of global warming, is far more influential than simply the cost of producing it. All of this cost drives up living costs for individuals and therefore wage costs plus other production costs and generates inflation.

Oil reserves on company balance sheets, do we dare discuss?
We’ve heard little about this little issue so far, mainly because the oil industry itself is in utter disbelief and denial about global warming and the need to STOP consuming it. The reality, however, is that we must stop.
What this means is that oil companies around the world who have explored, mapped and purchased leases now have proven resources on their balance sheets of a size that is unheard of in any other industry apart maybe from the mess that is domestic property. Who will take the hit when one day very soon indeed, we have to draw a line through all these assets?
Surely the values of the shares must begin to feel the pressure very soon as more investors realise what lies just around the corner and what about the banks that are heavily exposed to this debt?

And it’s not just oil company balance sheets.

What about the nations that rely on selling weapons and the like to states that rely on oil production?

How will the state replace the enormous revenue it currently earns on inflated oil and oil products? Will they simply tax electricity? What would happen to the world economy if 60% of us dumped the cars we really don’t need and worked form home, in a pleasant location? Motor cars created the world economy we know today and still holds a prime place. From management, to marketing, we owe most of our process to the manufacturers of cars and the annual cost of owning a car is a huge chunk of GDP for something most of us simply don’t need, especially if it becomes more expensive.

The Winners

The winners, especially in Europe, but it’s a global trend, are governments who enjoy an ever-growing tax take. {compare it to banking}

“In every €1.50 spent on a litre of gasoline, [people] pay 70–80 cents to the government.”

— Maciej Kolaczkowski.

Governments are very slow to tell us the good news lest we should expect tax cuts, or decent services, but the reality is that around 50% of 3% (1.5%) of global GDP will wind up in the coffers of governments via the taxes and levies they receive from oil production. Its much easier than honest tax collection from profits, but it penalises the poorest.
When Oil jumped from $70 to $110 per barrel, the biggest global impact was that your government got a windfall to the extent of around £20 a barrell.

2011 Tax take for oil and gas production in UK was £ 19,880,332,235 at average price $95. A barrel.

Additionally, sales of petrol and diesel: 45–70% of the price you pay at the pump, regardless of where it was produced, also ends up in the taxman’s coffers.

50% * 3% * of 23 trillion = 345,000,000,000 a rough Rule of Thumb calculation.

Current excise duties are as follows:

UK Fuel Excise Duty rates — March 2011 to March 2022

Courtesy of the RAC

COP 26, is it a cop out yet again?

Currently, the international community is urging OPEC+ to increase production, but they refuse to act.

The US and others are releasing strategic stocks into the market to curb price rises, but the reality is that it’s a shouting and banging type market, not a scientific one and there’s already sufficient oil in production so this exercise is likely to be no more than a hope of buying it back much cheaper in a month or two. OPEC + knows better than most that their production levels are right and are ignoring the panic. There is in-fact no oil shortage and not likely to be one unless the US led attack on Russian oil supplies succeeds in stopping deliveries to Europe as has been the goal for several years by all evidence.

What all this says is that curtailing oil consumption couldn’t be further from the thoughts of the major economies, not for sanctions, other than to be seen doing as asked and certainly not for climate change management.
Now we know that its not an instant fix situation, but nevertheless, the rhetoric has totally blown the lid off any ideas of a coordinated effort to reduce oil consumption.

We are certainly no closer and we were never close. If this cant be grasped as a reason to try harder, then the writing is surely on the wall.

What are the chances of our surviving the climate crisis?

Lack of action on consumption.

To have expected a sudden drop in consumption would have been naïve. The world cant simply stop consuming fossil fuels, but there are small immediate cuts we can make.

1. For example, we can encourage home working to reduce to amount of unnecessary travel and even some heating costs. UK has led the way by backtracking on this principle.

2. We could disincentivise private motoring unless necessary such as rural locations. Nobody is making any effort to incentivise or influence driving behaviour.

3. Insulation is still a dream despite all the efforts made in the seventies to spurn governments into action. There are patches of activity, but its usually very inadequate when inspected up close. In UK for example only families on benefits or such get help.

4. Heavy investments in alternative energy is a real option and its not being picked up and run-with by governments

The fight over remaining supplies

We don’t like to mention it, but the balance of world power in our world is maintained by gas guzzling planes, rockets, ships, missiles and other forms of evil.
No attempt is apparently at hand to replace these in a hurry and don’t even imagine the boys with buttons will give up their toys. What this means is that they will continue to fight over remaining supplies of oil and more importantly control of these supplies. That puts in the limelight the Arab states, Iran, Russia, Venezuela, Ukraine and a handful of others. Those who want a large mobile army must control one or more of these sources. The only large power with its own supply at this point in time is Russia. Don’t we all wish we’d been nicer to them.

Russia, China, India and possibly a little further along, Europe in a strategic block, would seem favourites to win this power struggle.
The US and its “whiteboy” pals Australia, NZ, UK, Canada will undoubtedly find an excuse to grab Venezuela or another major source at some point and now we are set for the final act. Bring plenty of popcorn and a sickbag. There is always the eminent risk of this turning deadly at almost any moment.
As I write, the strategy seems to be to try and influence Russian voters to topple Putin and elect a US puppet. I don’t see that happening, but it demonstrates the arrogance and absurdity of the people in the game.

Meanwhile, what’s the prognosis if we do survive and don’t overestimate our chances?

UN secretary-general Antonio Guterres 4th April 2022 says the current climate change initiatives by governments internationally are “a file of shame”, warning that the world is “on a fast track to climate disaster” in a speech made following a “damning” report by the Intergovernmental Panel on Climate Change (IPCC).The major new UN report has set out the action needed to tackle the climate crisis and curb global warming to 1.5C or below 2C, including deep cuts to fossil fuels with a switch to technology such as renewables. The report from the UN’s science body highlights measures to cut emissions from the energy sector, agriculture and land, cities, buildings, industry and transport.

Five more years of lies and then it’s too late.

“It’s now or never,” IPCC report co-chair Jim Skea said in a statement with the report — the last in a three-part series by the IPCC, with the next review cycle not expected for at least another five years.

‘Now or never’: Only severe emissions cuts will avoid climate extremes, says UN report (

One way that governments can keep their high receipts and cut usage a little is to keep manipulating prices. A mixture of slow-burning war and sanctions, accusations and counter accusations ad nauseum could well be the diet we have to look forward to for the immediate future. This won’t do what’s needed however.
In desperation, there’s one last approach that is guaranteed to be in the minds of many of our global leaders if not indeed planned already to a detailed degree and that is the release of deadly pathogens to quickly kill off vast number of people who are not immunised to it like government officials and their key people plus key skilled people. The means and the strategy to do it have now been well established, the research has clearly been going on for some time from Wuhan to Ukraine. Even if it began with good intentions and you’d be a fool not to consider the likelihood now that we have seen some of the evidence and the attitudes.



Edward Taaffe

Ed is a technical consultant and writer in the areas of Digital and Products. He writes here on random subjects that catch the eye.