Oil: The American Calamity Is Coming

And there isn't a thing you or I can do about it.

Because no one, no one in this country, is or can be completely energy "independent" unless you are, perhaps, Amish. And even the Amish will take a coming hit.

You can try all you wish. But in this country as well as all others, everything revolves around oil.

And (stating the obvious) you can thank the Religious Left for our inability to take care of ourselves and stake a percentile of energy independence -- though it is a given that we have a huge stake in natural gas, and we have vast expanses of yet-untapped fields in the lower 48, Alaska and directly off both of our coasts.

We could be much more energy-independent -- had we wished this to occur.

In the meantime, when the price of every product goes up due to transport costs, when you wait in lines for $6 gas, when you can no longer get gas -- you only have the Religious Left to thank.

No nuclear plants. No coal plants. No gas plants. No electrical generation stations. No refineries built. No drilling. No tapping. No. No. No. And the Religious Left is about to reap what they have insisted not be sown.

And what might be the indicator (which most people seem to be ignoring) that is providing a massive clue? To wit, from Reuters:

(Reuters) - Oil held near 2-1/2 year highs on Tuesday, with worries about turmoil in Libya that sent prices soaring the previous session eased by expectations that OPEC and the International Energy Agency could meet any shortfall in oil supplies.

At least three international oil companies have halted production in Libya, which pumps nearly 2 percent of world output. Some companies have been pulling employees and their families out of Africa's third-largest producer, though others say they are keeping oil flowing there.

Oil prices surged as much as 6 percent on Monday, taking Brent crude in London to almost $109 a barrel at one point for the first time since 2008. Prices remained strong on Tuesday, but closer to $106.

"We've lost 300,000 bpd of production (in Libya) already with the potential for further cuts to output and exports," said Andy Lebow, a trader at MF Global in New York.

"The major underlying fear in the market is that these protests spread in the region to even larger producers like Saudi Arabia. While that might not look likely right now, even a hint of real problems there could send prices vertical."

Brent crude for April delivery rose 4 cents to settle at $105.78 a barrel, the highest close since September 2008 but off earlier highs of $108.57. Brent hit a 2-1/2 year high of $108.70 a barrel on Monday.

U.S. crude for March delivery, which expired on Tuesday, rose to $93.57 a barrel, after touching $94.49, the highest since October 2008. It was up $7.37 a barrel from Friday; although the market traded on Monday, it did not print an official settlement price due to a holiday.

These are roughly the highest gas prices in a given February since 1990:

The U.S. weekly average price per gallon is $3.19, up 54 cents from a year ago, and slightly higher than last week's $3.14. This was the highest price posted during the month of February since 1990, when the data became available. The most expensive regions again are New England at $3.23 and California at $3.56.

THE primary factor? Libya. Libya is the major producer of "light sweet crude" oil. And from there the petroleum box is shaken.

Few if any people saw this coming. There are any number of "educated" Opinists weighing in with their thoughts and screeds. But at this -- truly -- early point, I submit that no one clearly knows how or why this Egyptian then Libyan (and Middle Eastern) movement came about. It just is.

All we know -- now --is that, like a snowball rolling downhill, area and momentum is growing.

As opposed to Egypt, Libya's Muammar Kaddafi isn't giving up easily.

Hence the jump of oil prices of 8.5% in one sole day.

WAIT: THIS JUST IN:

Libya's Muammar Kaddafi to begin sabotaging oil facilities?

Pressed, my Libyan source acknowledged Gaddafi is a desperate, irrational man, and his threats to turn Libya into another Somalia at this point may be mostly bluffing. On the other hand, if Gaddafi in fact enjoys the loyalty of troops he thinks he has, he very well could take Libya to the brink of civil war, if not over.

There's been virtually no reliable information coming out of Tripoli, but a source close to the Gaddafi regime I did manage to get hold of told me the already terrible situation in Libya will get much worse. Among other things, Gaddafi has ordered security services to start sabotaging oil facilities. They will start by blowing up several oil pipelines, cutting off flow to Mediterranean ports. The sabotage, according to the insider, is meant to serve as a message to Libya's rebellious tribes: It's either me or chaos.

Two weeks ago this same man had told me the uprisings in Tunisia and Egypt would never touch Libya. Gaddafi, he said, had a tight lock on all of the major tribes, the same ones that have kept him in power for the past 41 years. The man of course turned out to be wrong, and everything he now has to say about Gaddafi's intentions needs to be taken in that context. (See TIME's exclusive interview with Gaddafi.)

My Libyan source said that in order to understand Gaddafi's state of mind we need to understand that he feels deeply betrayed by the media, which he blames for sparking the revolt. In particular, he blames the Qatari TV station al-Jazeera, and is convinced it targeted him for purely political motivations. He also feels betrayed by the West because it has only encouraged the revolt. Over the weekend, he warned several European embassies that if he falls, the consequence will be a flood of African immigration that will "swamp" Europe.

Oil?

Hello?

Anyone listening?

Anyone?

BZ