He was probably talking about striking out every at bat, in a crucial World Series game against the Boston Red Sox, or something equally galling to a baseball player of his stature.
Uprising in Egypt Begins Another Middle Eastern Violent Fracas
In Egypt, a massive uprising of citizens is underway that is certainly redundant, if not strictly deja vu. Once again, in the most volatile political region in the world - the Middle East - passions fanned by ancient animosities have erupted.
Like Pavlov's dog, the world is reacting with alarm at this chain of events that has happened many times before; for in the US and other industrialized countries of the world, in addition to the threat to humanity of spreading violence, the uprising underway represents curtailment off shipments of vital oil from that region.
Instability in Middle East Began in Last Century When Seven Sisters Got Jilted
These outbreaks go back to the second half of the 20th century, after the sheikdoms expropriated the oil and gas assets of the powerful oil cartel known as the “Seven Sisters,” in the 1970s. From that evolved OPEC, another powerful cartel of monarchies that supplanted the control of the oil companies .
The Seven Sisters dominated the world oil business in the middle of the 20th century, craftily signing long-term contracts with Middle Eastern and North African (MENA) producers at fixed prices, enabling them to refine and market petroleum products throughout the world profitably. Those companies were:
- Standard Oil Company of New York (ExxonMobil)
- Standard Oil of New Jersey
- Standard Oil Company of California
- Gulf Oil
- Texaco (Chevron)
- Royal Dutch Shell
- Anglo-Persian Oil Company (BP)
Protests Are Focused on President Mubarak and the Military Government
The latest crisis is a revolt against Egyptian President Hosni Mubarak’s government and dictatorial style. As the Egyptian vice president in 1981, he became president after President Anwar el-Sadat was assassinated. Mubarak, a stern ex-military officer, has ruled under “emergency law” ever since.
Before the killing and wounding began in Cairo and Alexandria on January 2011, President Mubarak’s government made an incendiary announcement, which did much to heat to a boiling point the simmering political pot in Egypt. On May 10, 2010, when the parliament extended “emergency law” for two more years, the cauldron blew up.
The most onerous part of that law gives the government the “authority to arrest citizens without charge, detain prisoners indefinitely, limit freedom of expression and assembly, and maintain special security courts,” according to Michael Slackman’s reporting in the New York Times of May 10, 2010.
Egyptian Dissidents Are Also Angry Over Hard Economic Times
In addition to having stretched an emergency tight as a piano wire, President Mubarak committed the unpopular sin of nepotism, when he announced his inexperienced son, Gamal, would succeed him.
In addition, two years of economic stagnation in Egypt added to the smoldering discontent, and in a short time the atmosphere became ripe for revolt. Finally, in no small part the decline in value of the American dollar has exacerbated Egypt's problems.
Like most of its neighbors in MENA, Egypt is an oil producer, although not a major one. Since oil contracts are denominated in devalued US dollars, and forecasts indicate the American currency will continue its decline against the euro by 18% by fall of 2011, Egyptians cannot buy, nor can they look forward to buying, as much wheat and other imports as in the past.
They are tired of Mubarak’s 30-year rule under the guise of an “emergency law” that accompanied the military takeover of Egypt in 1981. Technically, the country has been a democratic republic since 1953. But when the military junta staged their coup in 1981, the country was lulled into a semi-dictatorship.
Middle East Oil Producers Account for Over 40 Percent of World Production
In 2009 countries in the Middle East produced 30.65 million barrels per day of crude oil, over 42% of total world production, according to the US Energy Information Administration. Considering that 60% of that oil passes through the Straits of Hormuz, the sea gateway to the oil-rich Persian Gulf states, it is not difficult to understand that warfare in the region is anathema to world oil users.
It is axiomatic the world watches with baited breath as the crisis in Egypt plays out, mainly because oil price shocks can accompany hostilities in that region. That has happened at the following times:
- 1973 – 1974 (Yom Kipper War)
- 1979 (Iranian Revolution)
- 1980 (Global Business Conditions)
- 1986 (Global Business Conditions)
- 1990 – 1991 (Iran – Iraq War)
- 2003 – 2008 (Unexpected Increases Global Real Activity)
But even allowing for the fact that not all oil price shocks are caused by conflicts in the Middle East, anxieties will remain high over the present revolt in Egypt. Reflexively, whenever shipments of the world’s major source of fuel and power either becomes more expensive or its delivery is throttled, whether by price shocks or the scarcity caused by war, the rest of the civilized world suffers.
Howard Bryan Bonham - Howard Bryan Bonham is a former daily newspaper editor and award-winning financial writer.
