Praise the Lord Oil. The « New » Cold War Was Over Before It Began. Oil Price.com

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Why did the Soviet Union collapse?

If you answered an « arms race »… well that certainly didn’t help. But, the real answer is actually this: OIL.

While Ronald Reagan is no longer with us, his son detailed the surprising way Reagan defeated the Soviets in a recent essay:

« I suggest that President Obama might want to study how Ronald Reagan defeated the Soviet Union. He did it without firing a shot, as we know, but he had a super weapon – oil… Since selling oil was the source of the Kremlin’s wealth, my father got the Saudis to flood the market with cheap oil. Lower oil prices devalued the ruble, causing the USSR to go bankrupt, which led to […] the collapse of the Soviet Empire. »

Today, Vladimir Putin would be wise to remember the famous phrase « those who cannot remember history are doomed to repeat it. »

Because Reagan’s gambit is playing out again!

Russia built up huge reserves of cash in recent years thanks to soaring energy prices. However, it once again grew fat and inefficient. Putin’s cronies run the companies controlling its vast oil and gas fortunes, and they do so poorly.

Which was fine when oil was expensive and filling up your car cost $4 or more a gallon. But now that we’re filling up our gas tanks for $2 a gallon, Russia is spiraling back toward collapse.

And here’s the important point to remember.

When the Soviet Union fell, it was the Saudis pumping oil that drove them to bankruptcy. That left Saudi Arabia as the great oil superpower, and brought vast fortune to the country.

In 2010, the Financial Times estimated Saudi Arabia’s state oil company was worth a stunning $7 trillion — about 20 times larger than America’s largest oil company, Exxon Mobil!

Being an oil superpower is clearly lucrative.

But here’s the thing – today it’s America that’s playing the role of Saudi Arabia. We’re pumping so much oil that we’ve turned the world’s oil market upside down.

And unlike Saudi Arabia, we’re not pumping oil because we won a geological lottery and have massive underground lakes of oil stretching from Texas to New York.

We’re doing it the American way.

50 years of tireless American work and innovation finally produced a massive oil breakthrough in the past decade. We cracked the code on how to generate 10X, 20X, up to 100X more oil than previously thought possible!

The proof comes directly from the US Department of Energy. Here’s the amount of oil American companies are drilling per day from an oil play in Pennsylvania. I’ll let you guess where on the chart we cracked the code on this new technology…

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Source. oilprice.com

American exceptional unsinkability.  Recall our previous note.

America is that UNIQUE nation losing wars after standoffs and, invariably, coming forth and back stronger than before as the Eternal Winner. Even when they lose, they win. This is American Exceptionalism. Insubmersible.

Who can outbid ?

This oil price news is capital = priceless, to understand the US foreign policy : the nation is always on the offensive and holds the stick of global initiative.

For a complete picture. Read also our three latest posts below and catch the oilprice.com express.