Hubbard's Peak and the Saudi's

Fellow RINO Dave Justus has a great post on Hubbard's Peak:

There has been quite a bit of talk on the left side of the blogosphere about high oil prices and Hubbard's peak. For those of you who don't know, Hubbard's Peak is when we achieve maximum oil production and begin a long decline, coupled with highly rising prices.

...Additionaly of course, high oil prices have the potential to greatly benefit Iraq. With the insurgency there it is unlikely Iraq will be able to greatly increase it's Oil Production quickly, but high oild prices means that nation gets a lot more capital for what it does produce. This capital will hopefully be able to fuel economic expansion, which will do a lot to quell the domestic insurgency.We could also consider the likely effect of high oil prices on some of the other Oil producing states, such as Iran. While certainly the increased money will help the Iranian governments coffers, it seems unlikely that a country with a command style economy will be able to effectively invest that money into wealth producing industries. This means that the increased money will have little effect on the lives of ordinary Iranians. While increased social programs may help to keep the people happy, this will be a difficult balancing act. And, should the Saudi's indeed be able to increase production, a signifigant increase in Iranian social programs, followed by a reduction in the price of oil and the need to cut those programs could be the end of the mullacracy. You can sometimes buy off the mob, but if you do you can never stop. Although not an Arab nation, Venezuala is in a similar to Iran in this way.

One important thing that Dave didn't mention is that our refining capacity is stagnant and no new refineries are coming on line soon (it's been twenty-nine years since we opened a new one). Even if we had all the oil in the mideast, we still couldn't refine it into usable product and therby reduce prices by increasing supply. President Bush has broached the idea of utilizing old military facilities for just this purpose.

This country has the technology to build cleaner refineries, I've seen some of the plans. We also should allow new refineries to built based on a security plan that will ensure that acts of terror would not disable our gasoline and diesel producing capabilities.

Here's a pretty good article from a decidedly leftist site.