By GHK Lall- When oil prices fall, profits go in the same direction. I am nominating Vice President Dr. Bharrat Jagdeo for the Nobel prize in economics. He took the ordinary, what even a dunce would know in his sleep, and made it sound as the wisdom of Solomon. It is no easy feat to convert the ordinary to the extraordinary, but Comrade Jagdeo did.
Prices fall mean less coming into the plastic bag. Less revenue collected means that the same 75% in expenses from the top leave less in the profit column. Unless, of course, expenses claimed by Exxon also go into a steep decline. Unlikely. Jagdeo is bright and he is right: oil prices take downward flight and Guyanese get their next fright.
It is sayonara to the big money (maximizing revenues) that he promised in 2027, when there was to be, er, that sweet confluence of circumstances: more projects aligning and operating. Hopefully, it would only be a quick blip, then back up again.
Meanwhile, the other bright boy in the PPP Government, the ambitious Young Turk, wanted to prove that he learned something in Scotland. Pump more oil daily to compensate for prices that turnout ruction, not cooperating. Somebody do me a favor, please.
Please tell these chaps that crude oil is not callaloo or catfish. It doesn’t grow back. Or, to employ one of Comrade Jagdeo’s fancy phrases, it is a depleting asset.
The thrust behind all of this is embedded in that old saying: fortune favors the brave, i.e., those who strike while the iron is hot. Oil prices high, daily production rising higher and higher, Exxon’s Darren Woods, Alistair Routledge et al all speaking like the Queen’s (better make that king’s) jewelers.
They embroider their sales pitches about their Guyana prize with glowing terms such as ‘crown jewel’ and ‘gem’ and ‘world class’ and other mesmerizing Shakespearean symphonies. Note that I wrote Exxon and their Guyana prize. Conclusion -it is not that of Guyanese, anymore, thanks to Jagdeo and his band of slippery parliamentary brothers.
When reminded that oil prices are cyclical, he scoffed and smirked. When told to do something so Guyanese get more, he told his people to deal with those holding up progress.
When pushed to ringfence the new oil projects Exxon lining up like minibuses at the Stabroek Market bus park, he came up with a ring to wrap around the mouths of those coming dangerously close to subversion (the PPP version). Answered a million times. Dealt with already. Get a move on.
Now he is crying the Blues, in his best Ben E. King imitation: Stand by me. Guyanese are free to do so. Just don’t look at me. I have my own song for him: What kind of fool do you think I am? Oil profits could fall, and the big boss man is warning Guyanese that pain is on the way.
I said to the wiseman that he must get the money while the going is good. But he doesn’t want to stand before Exxon and twist Exxon’s hand.
Comrade Jagdeo’s preference is to engage in fisticuffs with those troublesome Guyanese insisting that ringfencing is the way, and it must be now. There is number seven on the way. I have bad news for the ring fencers. Fat chance of that happening.
Look at it this way: if Jagdeo and the PPP Government can’t stand up against America for Cuban doctors, they are not going to stand up to Exxon and say, let’s get it on. I have said repeatedly that Guyana is an American satellite like Puerto Rico or Guam. Other times, that it’sthe 51st State in the American Union.
Circumstances have proven me right. Oil and Exxon. Cubans and Americans. US deportees coming and Guyana receiving. America pushing, Ali supporting (voting automatically). Anyone who hears anything about Guyana’s interests or Guyanese in those cocktails, please send a FedEx.
Oil prices fall, and all of Mastermind Ashni Singh’s comforting numbers, stats, ratios change complexion. Anemic first, then jaundiced later. If I know that when the numerator declines, and other things stay still, then the result is smaller, then Dr. Singh knows that even more.
Guyanese go from trickledown to ripple effects to rogue waves inundating the vulnerable and the out of luck. People don’t have too much patience with profits and statistics during such times. They are too busy trying to stay afloat.
Last, oil prices tend to stay down for extended periods. Think heavyweight champ Sonny Liston and that phantom punch that knocked him into the next decade. Guyana could be staring at that, should prices fall precipitously and remain so. Don’t forget debt service, then.
Should Vladimir Putin get ideas at retaliation and open his oil taps (consequences and all), prices could nosedive. Plus Mr. Trump’s new supply. Plus, Wall Street reeling. Plus, recessionary fears. Plus, demand from China slowing. Plus, overall demand. Plus, the Saudi Arabians weighing their moves. Are Guyanese still thinking profits?
In the words of the seasoned, cash in chips when ahead. Exxon wants to increase production. Ringfence. Exxon wants a new project. Ringfence. Exxon howls about ‘economic loss’, well that makes two in the puddle. Somebody around here has to have the cricket balls to play at that game. Footballs are even better. They are bigger.
