Xenophobia? South Africans Might As Well Be Poles Apart

On eTV news at 10pm this evening there was excellent footage of looting in progress in Cape Town. The area was called DuNoon. The cameramen were running and moving between policemen, and actually recorded shots going off, police smacking and throwing around looters.

In one scene the camera was inside a shop (known as a spaza store, often built inside a shipping container, made of metal, offloaded in a poor township) and a number of looters were making their way out. Carrying bags of sweets, one old overweight woman was hauling a large plastic tray with various treasures on it. People were dancing, and jubilant as they gained access to these booty prizes. Outside two women scuffled over hard won spoils, one spilling flour over herself. Is this Xenophobia?

What is crazy are these messages on TV, and on blogs, broadcasts that chide, or warn or plead with these perpetrators... The reality is, no one is listening, because the people who are experiencing the violence are in the poorest corners of South Africa. They are not watching television. They may not even have homes, or beds. They are people with sick and dying daughters and husbands, who celebrate getting their hands on a 1kg packet of flour. These are not people who own televisions, and certainly don't have the luxury of computers with an internet connection.

Poor people in South Africa make up a SUBSTANTIAL fraction of the population. There are enough poor people to overrun this country if they decided to do so. If there is any culpability for their condition, it is not just the government's, it is everyone's. A friend who visited from the UK once admonished me, saying: "How can people living in large mansions with swimming pools manage to ignore huge swathes of land covered in squatters? How do you live with yourselves with so many people suffering in abject poverty right next door?" We should have addressed these people sooner. We should have found ways to get them employed, even if it was simply dedicating the lands around these townships to the intense cultivation of vegetables. Most middle class South Africans will agree that we have shut them out, out of our thoughts, out of our hearts; they simply haven't figured in our calculated lifestyles, because they are out of sight and out of mind.

No more. With the violence having erupted, and the sheer ubiquity of the attacks - middle class South Africans have grown increasingly alarmed at the escalating state of affairs. And we should be alarmed. With petrol prices set to continue, the poor are entitled to feel even more gloomy and hopeless about their prospects. So yes, we should feel threatened...the poor are lashing out, struggling to survive, and soon, that frustration, desperation and anger will spread to the lower middle classes. The resentment will begin to build between the haves and the have-nots, who remain poles apart, but a fiery bridge of violent criminality is slowly forming across the abyss. It's not racism. It's not xenophobia. It's people with nothing trying to survive, and resorting to opportunism, stealing and thieving, to address their problems of scarcity. These poor people can no longer afford the basics, and we can no longer afford to ignore them, or to shout at them over television screens and internet connections. Go to them where they are, and see that they are simple people with tremendous difficulties in store for them. At a time when it feels harder to be generous, to listen, to learn about a world beyond our street, we must try to give even more, m,uchj morte of ourselves.

Click here to link to a video.

Fat Free Living

So it's taken me 4 or 5 weeks to get back into the gym (I've lost count, I can't be sure, that's how bad it is), and so here I am sitting on the bike at some dark chilly hour of the morning, and I'm trying to get my heart rate monitor to acknowledge my existence.

So I'm riding and starting to sweat and the HRM just won't pick up any signal. I say to the oke next to me stuff about the market not acknowledging $135 oil prices as fair value, about the market not realising that there is a simple supply/demand problem, and all the while my heart rate monitor still won't pick up my heart beat. I let my body heat up, and as the sweat begins to trip I try again. Still nothing. I probably go through this process 5 or 6 times.

I start saying to the guy next to me that maybe I haven't lost much fitness. I say that on fietstoer you can transform yourself rapidly in a week, but obviously from very high levels of activity each day. How fit can you get in one day?

I look at my heart rate monitor. Still dead. I lift my shirt, feel fat rolls, and say grimly, absently: you know this thing probably can't feel my heart through all this fat. It probably reckons this is a false alarm anyway, like I am not going to bother to record this fat slugs heart rate once in a while like this.
And like magic, after I had uttered these self deprecations, the heart rate signal began to pop. Once the bubble of our silly fantasies pop, we can start working on the project of living. Real living.

NVDL speeds to 77777

It seems like just yesterday that I reported this blog to have surpassed 75 000, and it is now well on its way to 80 000. Each and every day this week has reported much higher numbers than each and every day of the previous week, and this is against the background of only a few blog posts that go up between 17:00 and 22:00.

My prediction is as the oil price shoots by $140 and $150 traffic to this blog (and other blogs concentrating on Peak Oil) will begin to double, and triple in numbers as people increasingly dispose of those conduits that have been peddling bullshit. As trouble intensifies, those resources unable to provide insights that make any sense are rapidly going to face obsolescence.

Here's more evidence for the rise of interest around oil on the net:

Hoarding, Shortages and Violent Fools

NVDL: There is something very seriously wrong when prices break records for something like 7 straight days, including overnight gains of $8. While many cried 'false alarm' when prices fell $4 followed the $135 record, within a day they have climbed another $1.90. This is extraordinary; it shows the oil price has got a lot backing it up. It can make large upward jumps off all time records, fall back, then rapidly climbs back to and beyond those record levels. Those who are counting on these 'bubble' theories ought to look at the facts:

Energy Watchdog Warns Of Oil-Production Crunch

The world's premier energy monitor is preparing a sharp downward revision of its oil-supply forecast, a shift that reflects deepening pessimism over whether oil companies can keep abreast of booming demand. The Paris-based International Energy Agency is in the middle of its first attempt to comprehensively assess the condition of the world's top 400 oil fields. Its findings won't be released until November, but the bottom line is already clear: Future crude supplies could be far tighter than previously thought.

NVDL: A lot of people already know this, as we have been measuring depletion everywhere, even in the world's super giant fields like Ghawar.


Yet there has been some fascinating analysis of the current high oil prices, with a vast majority stuck in denial, citing: bubbles, speculators, dollar weakness, even Peak Oil panic. What this response says louder than the words themselves is simply this: people aren't ready to accept reality, people aren't prepared to accept that supply simply can't keep up because that would mean we would have to address demand (something we do each day) and I think everyone is still a long ways off from understanding reality. This is bad news for everyone, because it just postpones the collective wake up. It means, as long as people remain dismissive of high prices as a market fluke, a bubble, something that is someone else's fault, a temporary glitch, for as long as that happens, the house we're in, with all its beds, continues to burn unabated. It just makes the crash more severe when it happens.

Here's a reality check: large companies and countries are now undertaking massive hoarding behaviour. India has started with a SPR, and any other country with spare cash, and a right mind,ought to do the same. What that does, is sets off two responses:

1) increased demands and accelerated price increases
2) shortages

And once the world sees shortages appear in the system, we will see 1) and 2) repeated even more intensely. That's where we are now. Those shortages we've already experienced, are going to start lasting longer, as long as a few days, it will come back on, then we'll have nothing for a week, then worse. It will depend on our government and SASOL (in SA) to attract and pay for fuel when everyone else is also fighting for scraps. We're lucky that we won't be paralysed entirely straight off the bat - SASOL produces about a third of our petrol needs. So the next time you're in traffic, look at the car in front of you, and in the rear view mirror at the car behind. Only one of you can expect to be on the road over the medium term.

If you thought the power cuts from Eskom were a temporary blip on the radar, think again. We are now going into winter, and here consumption goes up anyway, even when we're trying to cut down. There was a warning tonight of load shedding, and the mercury won't even approach zero. When it does, and it will, large areas will once again be without power.
Remember also that every time this happens, a number of substations are destroyed in the process, slowly eroding infrastructure. Some of these substations will be rebuilt, most won't. It's the beginning of the degradation of this system, and I don't predict lights at the end of the tunnel.

In South Africa the many crisis that exist will manifest even deeper, in particular:

1) crime
2) mob violence (spreading throughout poor communities)
3) system breakdowns (electricity, water, police and health services)
4) recession and responses to recession - protests, unemployment, civil strife (this time from the middle class)
5) ordinary delivery failures (postal, food etc)

The reasons for all this are also basic; the infestation of high fuel prices into the system, meaning food prices becoming less affordable, mass defaults on loads, mortgages, and the unfolding of recessionary processes associated with stagflation - the nightmare scenario that is actually the world case scenario - high prices associated with unemployment, and lower growth.
The creep of higher prices won't stop, producing more and more economic losers, who become part of an unstable system of unemployed, angry, hungry mobs. This stresses the system even further, leading to the doomsday stuff: widespread disease, widespread conflict, and large scale war.

What can we do in this unfolding situation? Invest in your community, be part of your community. Understand, follow and manage the situation. Stay alert, and stay awake. Start practising now how to eat and live right. Stop wasting time, and sort out all those relationships that need sorting out. We're going to need each other a great deal sooner than we think.

Producers say $200 oil is possible as prices hit record three days running

Let's look at Rail (PHOTOGRAPHY)

Errr, can you pay attention for a second. Excuse me? Hi. One way to address the high oil price is to find alternatives to one of its biggest consumers - the motor vehicle, and no one is seriously addressing this issue. Everyone is suggesting everything else, biofuels, hybrids (by the way, hybdrids aren't the answer) hydrogen, any way to perpetuate our motoring madness, but it just doesn't have a future. We're trying to force the issue, but we're losing face with reality fast. It helps to remember that oil is a finite resource. Once you've gotten that into your way of thinking, it becomes easier to let go of our idea that all this stuff could carry on for ever.

Now, as I was saying. Railways. For big countries like the USA, SA and Oz, it's just the sensible thing to do. Problem is, can we really expect people to be behaving rationally, to make rational choices now, when they still aren't even beginning to understand that the shit cubed on the horizon is expanding and advancing at a geometric rate? We all assume that when the shit lands on us, we can just opt out for a cleverer scheme. Trouble is, by the time enough people realise the shit is advancing, there's going to be too much chaos and slippage to allow for a smooth transition to steady state construction of sensible alternatives to how we are running our transport systems.

We really need people to step up now, and start writing checks for a new dispensation, a new bluepint for the wiring of our cities, and how we move around. Rail is the answer, but are resources stable enough, and business leaders sane enough, to make the right choices in time? I pray we do, but I fear we are mired in confusion and uncertainty already.

What is real? (Xenophobia SFX VIDEO)

Bubble or Bumbling: Send in the idots to brilliantly pontificate about oil (they're pretty crazy, so far, but get the right answer here)

"The future is here, it's just not well-distributed yet"- William Gibson

There are plenty of explanations for what's happening in the global oil markets. It's caused by the economic boom in the world's largest developing countries, particularly China and India. It's caused by the unwillingness of the oil cartel Opec to pump more crude. It's caused by the fact that the world has reached peak oil - the moment in our history where supplies of the black stuff start to dwindle.

All of these factors may have contributed to the upward trend in the oil price over the past six years, which has seen the cost of a barrel of crude rise from around $20 a barrel to $135 a barrel today. None of them really explain, however, why the price should have gone up by more than $5 in the past 24 hours and by a third in little more than a month. That sort of price action is the result of a speculative frenzy of the sort that was witnessed in the dotcom mania of the late 1990s. The oil market, to put it simply, is a massive bubble waiting to be popped.

[And] in the oil market, the fundamentals no longer matter.- Larry Elliott

NVDL: Really? Is that Elliot or Idiot? Actually the bubble that needs to be popped is the thought bubble of lunacy that envelops your brain, and since you're writing and communicating this garbage, you're also infecting the human intellectual stream with this nonsense. Here's the correct assessment of these high prices:

Oil's No Bubble
Lionel Laurent and Carl Gutierrez, 05.21.08, 4:00 PM ET

Oil's astonishing rise is becoming a cliché on Wall Street, but the rise is real and will keep going until supply catches up with demand. "The story of the past month has been the sudden surge demand in China for diesel fuel," said Jeff Rubin, Chief Economist and Chief Strategist at CIBC World Markets. Power plants in some areas in China are running desperately short of coal and certain earthquake-hit regions are relying on diesel generators for power.

Rubin stressed, though, that the spike in demand over the past month is only a footnote to the bigger story: "Even at $133, demand hasn't been reined in, and without a real raise in supply we think it's ultimately going to go over $200 a barrel."

NVDL: To summarise, fundamental factors, the simplest possible explanation, are why oil is going up. Again (repeat after me if it'll help you remember): Supply is not able to meet demand. It's Economics 101, and yes, it really is that simple. And some of the most brilliant and esteemed economics writers, and 'experts' are still arguing that it's not even happening. Reality is going to hit these denialists very very hard. It's going to hurt. Because now stubbornly and stupidly reasoning against reason is really going to cost us, and we can't afford to continue being the dimwitted species that fucked up the planet.

An interesting additional point: the reason why oil companies haven't built additional refineries since the mid 70's is they know there is no reason to - because we haven't found the means to produce more than we are producing now, and haven't for some time. There have been no major new oil field discoveries since the early 80's, when all we found was the North Sea, Prudhoe Bay and some Russian oil. Now it's 20 years later exept we found all the big stuff (that wasn't so big after all) there was to find. So that in itself says a lot. Actions - of the oil companies - speak louder than statements from OPEC or anyone else.

Another question: for those informed few of us, what do we do? Do we wait until the world catches on? Do we also operate as per normal, or do we begin to proactively make the sort of changes that we can only guess, and estimate and imagine are the most practical, reasonable and rational. My guess is we start fending (and thinking) for ourselves NOW.

The Refugees Up Close

Stepping out of a comfort zone, the daily cocoon, is highly recommended. If you find yourself feeling sorry for yourself, or worrying about yourself, go and have a look at how people poorer than yourself are coping. I can tell you my heart really went out to these people today. 'The poor' aren't just a concept, or a category, they are many many different people, with their own hopes, dreams, ideas and difficulties.

And do you know what? They were not miserable - most of them. A lot of them greeted me, some smiled, and called to me when I took out my camera. They were from Malawi, the Democratic Republic of Congo, Mozambique, Angola, and yes, many from Zimbabwe. There were about 1500-2000 refugees crowded onto the lawns, a sort've backyard courtyard area behind Jeppe Police Station in Johannesburg.

When Chris and I first pitched up we thought nothing was going on, because from the outside the police station looked random and unassuming. There were two strange looking black men, one with a Muslim like skullcap on, standing outside, well-dressed but looking troubled. Behind them was a red ant, a man dressed in a red overall and carrying a green crow bar. We followed him into the building and towards many more 'ants' and a din and then, there they were...a huge crowd...as though Jesus were on the other side, giving an impromptu sermon. What other reason could have brought so many people here together?

Near the door was a young white girl handing out pieces of paper with about a dozen children scribbling and coloring on their paper, sitting quietly around her on the ground. In itself, it was a lovely portrait of man's humanity to man. The crowd was subdued. I have taught classrooms with 30 students that made far more noise than this 2000-strong crowd. They seemed spooked, and disoriented, and dismayed, but not morose or angry.

Chris led me to the VOC, and after speaking to a priest who wanted to refer us to 'someone in charge' we spoke to someone with 'Burger' emblazoned on his chest. Later on we met Sheila, a volunteer from no organisation, who was helping out. She showed us a little boy with an interesting pair of glasses he'd made...and asked if we wanted to take a photo. She said some of the people had been here since Sunday. I asked her where they slept, and she said there were tents around the back.

On the raised patio there was a table, and entry to this higher platform was controlled by a few red ants. We saw a lot of bread, and a few cups with beef soup going up and down steps. People had to fill in forms, I'm guessing, each time they came up to eat. There were a few, a handful of individuals with bright yellow and blue police vests milling between the crowd. I wanted to walk between the crowd, but Chris was concerned for our safety. Sheila, the white women who sort've became our chaperone, said we'd be perfectly safe, and led us down between the people. We walked between pots and pans, the odd fridge, someone cooking pieces of meat on bone and tomatoes, mothers with children, people sleeping in the sun on mattresses, large groups standing around, possibly in prayer, or just listening to someone speaking quietly, between all the human paraphernalia - scattered, you had to guess, you had to imagine, by tempests of violence.

Some refugees I spoke to said they were just sleeping on the open ground. Women and children were in the tents, some breastfeeding, some just lying there, obviously feeling lost and uncertain. How would you feel if all your possessions amounted to a few blankets, a big plastic container loaded with dishes. You'd left your country and now, didn't know where you belonged.

Someone said that there were plans to put everyone in an area together, which made me think that 'integration' hasn't worked in the black townships. It hasn't worked on many university campuses either. South Africans, black and white, appear disintegrated, and to be - as a society - disintegrating further. The countries entire population, even including the flood of immigrants, is shrinking at -0.5% a year.

The tent feels oppressively hot, and on the outside, lots of washing is strung on lines, dripping, causing marshy conditions underfoot. I stumble upon a woman who is about to urinate in a corner where all this washing was hanging, and it occurs to me that after a while, this place isn't going to be suitable for so many people.

I also stumble upon a young Zimbabwean mother, Thandi, and a cute little girl, Diana. She is the only person who is certain that she wants to go back home (to Zimbabwe). She says they have made arrangements to catch a bus. She seems resigned to it, but determined, and in the few moments I share with her, I can't help being very touched by the difficulties just taking the trip home with such a young child will involve. Imagine going back to Zimbabwe now, with the elections imminent and 77 tons of weapons equipment having recently arrived?

A number of older women lay inside a tent; one says to me: "Your brothers did this to us."
It takes a while for the portent of this to sink in. I say: "I think the prices going up, for bread, for the bus fare, that's why the people have become angry. Everyone is struggling. And so they thought they can get rid of you, not because they hate you but because they have become desperate."
I think they might think I am not being sympathetic, or somehow not being supportive of what has happened to them, but they see my point immediately, agreeing that for everyone there it has suddenly become very expensive and very difficult to survive.

I suggest they try to find work on farms, because with food prices going up, probably there will be more jobs. I also tell them about the oil price, saying that unfortunately the future is looking more and more difficult for everyone. But I say, "If we can work on a farm and grow something together, maybe we can be all right."

It is only during the drive back, through Johannesburg's unfamiliar streets that I start to, recall my discomfort of taking pictures of these vulnerable people to Chris (my cousin, who is a professional photographer) . I recount my impressions of those terrible pictures of the burning man.
I'm clearer now than ever, that their consciences ought to be bugging the hell out of them - standing right there, taking pictures, while a man is burning right in front of you. Look, maybe they did try to help. I don't know. What I do know is, there where we were, I was touched profoundly by my encounter with the human condition. It seemed to me particularly vulgar to walk around, amongst these poor people, taking photos of them.

A few people asked me, "Why do you want photos?" and I took a moment to consider the question carefully. I said, "Because people want to understand, and need to understand what has happened to you. Because people want to know what has happened. I also want to know. And maybe this can help people to see what is happening here."
And so I hope you can see what I saw today.

It's Us Against The World (VIDEO & LYRICS)

Cause it’s us against the world
You and me against them all
If you listen to these words
Know that we are standing tall
I don’t ever see the day that
I won’t catch you when you fall
Cause it’s us against the world tonight

Chaos (ART/IMAGES)

Xenophobia spills over into Mpumalanga

The xenophobia in Gauteng spilled over into Mpumalanga on Wednesday.

"When we got to Extension 16 (of of Embalenhle), we found that two shops and a car belonging to a Somalian businessman had been burnt to ashes," said Evander police spokesperson Constable Sibusiso Mbuli.

While police attended that scene, they were informed of violent outbreaks occurring in nearby Leslie and had to call for back-up to be sent there.

NVDL: Please call or email me - or leave a comment here - if you become aware of riots in your area.

Peak Oil Panic: What can we do?

For starters, don't pretend that it's not happening. Monitor the situation. My concern right now is that it is accelerating very quickly, and there are already riots in Johannesburg. It's not impossible that this city, including the burbs and the work places where I will be, may be quite different at 5pm today. They might not be, but you and I need to monitor how things are changing, because right now, change is on course to be rapid and take us by surprise. And best to speak and learn from people who have seen this coming - I'm one. But there are plenty of resources that can offer intelligent advice about this: www.theoildrum.com, www.kunstler.com and No Impact Man are just 3 good one's.

Pay attention to what they are saying. Try to undertstand the systems at work. The bad news is systems will breakdown even further and this will happen more rapidly. The good news is we can start to form real communities now, and together, find ways to fend off the dark.

Today, right now, my advice is:

- monitor the situation
- evaluate your situation
- go to gym, get some exercise (I already have and it's 8:42am)
- speak to family and friends
- don't quit your job but start to consider an overhaul to your lifestyle - where you live, how you live, where you work, what you do, how you get there, how you're spending money, how much you're spending on food, and consider your family's interests
- right now you have to serious manage your money and your consumption, not just of things, but food
- start living healthy now, and try to contribute to the solution by using less of things you don't really need
- monitor your own stress levels; you need to stay strong and healthy in order to function, so get enough sleep, eat well, exercise, maintain a good balance
- be helpful and supportive towards others because we are going to need each other now more than ever
- finally, have some faith that the sun will rise tomorrow, and the next day, whatever happens

I am going to be blogging less, exercising and sleeping more, as I need to address the same balance I've mentioned above.

Oil surges to record $135

Oil for delivery in July hit $135.05 in New York after inventories of crude in the US had their sharpest drop in four months. Brent crude oil also set a fresh record.

The news came as a a Nobel prize-winning economist warned that sky-high volatile prices in oil, food and a swath of minerals are now a permanent feature of the economy.

	A surge in demand and poor production performance by Opec have contributed to the record oil prices

Michael Spence of Stanford University said that volatile commodity prices were perennial features of the modern economy, but were "worth suffering".

In a further sign that investors are betting on prices staying high well into the future, the cost of buying a barrel of oil for delivery in 2016 rose briefly above $142.

Analysts said that the rise in the oil price was down to a cocktail of factors, including strong demand from emerging economies and poor production performance by oil cartel Opec. However, in an unusual statement, the Bank of England dismissed claims that the recent spike in crude prices was due to speculation.

Prof Spence, the 2001 Nobel prize-winner, said the price rises in oil and in food, where crops have soared in value in the past year, were "a consequence worth suffering" of globalisation.

advertisement

"It would be a mistake to view this as a one-time phenomenon," he said.

"This is a natural consequence of higher growth in many developing countries. This isn't just a story about food or oil - it could be about cement, about metals and a whole range of materials.

"Perhaps it will be minerals or uranium, or the costs of logistics and transportation. Either way, I would be very surprised if the relative price of oil and gas fell to the level it did in past years. The rise in energy is semi-permanent."

The warning from Prof Spence, author of a major new report on growth in developing economies, came as crude inventories in the US unexpectedly fell, triggering a fresh rise in the oil price.

The US Energy Department said inventories dropped by 5.4m, or 1.7pc, this month.

Analysts are split on how much of the current oil price reflects actual supply and demand, and how much is speculative froth.

Some suspect the recent rise indicates the oil market has become a bubble, however the Bank of England said in the minutes to its interest rate meeting earlier this month: "According to... market contacts, speculative purchases did not seem to be the prime cause of the recent increases in the oil price.

More fundamental demand and supply factors had probably been at the root of its steep rise during recent months".

It added that while prices were likely to fall back in the coming months, this was unlikely to happen within the "time horizon relevant for current monetary policy" - around two years.

Societe Generale and Credit Suisse have raised their oil price forecasts for this year, while Goldman Sachs warned recently that crude could soar to $200 a barrel.

Chancellor Alistair Darling has pledged to lobby Opec to raise its production levels, but the cartel has said a further increase is unlikely, adding that it should not be held responsible for high prices. It has said that $30 of the recent increase in the price of a barrel is due to speculation.

NVDL: Remember what we have been saying. The markets are "sleepwalking", "delusional" "not awake" "fanciful" "disconnected" - and all it has taken is a couple of intellectuals like Boone Pickens Spence and a few Peak Oil guys Like Kunstler to simply confirm, to breathe sanity into the markets. Now the public reponse will be to feel that reality is "not real" "incredible "not possible" "fanciful". There is still a lot of waking up that needs to happen, and probably a lot of nervous breakdowns. In the mean time our collective troubles are accelerating.

The Death of the World (PHOTOGRAPHY)

Picture courtesy FANTAISIES SOUTERRAINES

Xenophobia Reigns in the rainbow nation

The South African Institute of Race Relations estimated that 4.2 million people were living on $1 a day or less in 2005, up from 1.9 million in 1996.

Group intolerance is not just a black and white issue. A recent poll by TNS Research Surveys, a local outfit, finds that 42% of people living in shacks, facing the fiercest competition for jobs and services, feel threatened by “other cultures”, far more than the national average of 29%. Attacks by black South Africans on Somali shopkeepers and hostility to Zimbabwean immigrants both appear to be rising. The housing shortage in the Western Cape adds to tension between Coloureds (mixed-race South Africans) and blacks. In a country as diverse as South Africa, all this is to be expected. The video incident has made everyone think harder about how to promote greater harmony.

More.

South Africa: Cape Town on high alert as Thabo Mbeki deploys troops to quell violence
South Africa violence: Death toll mounts

NVDL: Necklacing is making a comeback. I first thought it was a rumor but I'm seeing it reported more and more. There were housing tensions in the Cape even before these Xenophobic attacks, which means the possibility of flare ups in Cape Town is high.

Solving the $130 oil conundrum

When oil was $10 a barrel, the idea that the stuff was running out seemed demented. What a difference a decade makes. It is now possible to make the case that global crude oil production has nowhere to go but down. While that disaster scenario remains unlikely, it is hard to see a comfortable adjustment to oil near $130 a barrel.

In the near future, there is no saying how high the price may go – forecasting $200 a barrel is a nice way to get some headlines. Such forecasts may come true because in the short term there is little scope either to reduce demand or to increase supply, so it would not take much to drive prices higher.

There is no doubt that the world will adjust to high oil prices. Yet the adjustment would be far easier if oil producers discovered that they could expand their output.

NVDL: I believe there is a LOT OF DOUBT whether or not we can adapt to these prices.

Shortage fears push oil futures near $140

Fears of a shortage within five years propelled long-term oil futures prices to almost $140 a barrel, further stoking inflationary pressures in the global economy.

The spot price of Nymex West Texas Intermediate hit a record $130.30 a barrel on Wednesday. On Tuesday investors had rushed to buy oil futures contracts as far forward as December 2016, pushing their prices as high as $139.50 a barrel, up more than $9.50 on the day.

EDITOR’S CHOICE

In depth: Oil - Apr-29Editorial comment: The $130 oil conundrum - May-20 Analysis: Running on empty? - May-19

Veteran traders said they had never seen such a jump and said investors were increasingly betting that oil production would soon peak because of geopolitical and geological constraints.

Neil McMahon, of Sanford Bernstein, said: “Peak oil views – regardless of whether right or wrong – are seeping into the market and supporting high prices.”

Anne-Louise Hittle, of Wood Mackenzie, added that investors were shifting their focus from the short-term to the medium-term, where supply fears played a bigger role. Since January, long-term futures oil contracts, such as those for delivery in 2016, have jumped almost 60 per cent, while near-term prices have gone up 35 per cent.

That trend was exacerbated by T. Boone Pickens, the influential investor who believes world oil production is about to peak as aging fields run dry. He warned that oil prices would hit $150 a barrel by the end of the year.

“Eighty-five million barrels of oil a day is all the world can produce, and the demand is 87m,” Mr Pickens told CNBC. “It’s just that simple.”

Airlines Crash: Frontier Airlines files for bankruptcy

Frontier Airlines, a US low fare carrier headquartered in Denver, collapsed into Chapter 11 bankruptcy on Friday as the latest casualty of the growing shake-up of global aviation, as carriers struggle to cope with record oil prices and weakening economic growth.

Frontier said it had been forced to seek court-administered protection from its creditors in response to a move by its principal credit card processor, First Data, to start withholding “significant proceeds” received from the sale of Frontier tickets.

EDITOR’S CHOICE

Editorial comment: Low fare, high cost - Apr-13Low-cost pioneer Oasis collapses - Apr-09Access buys Air Berlin stake - Apr-07Alitalia’s fate rests with Air France-KLM board - Apr-06Delta and Northwest revive merger talks - Apr-06BA struggles to escape T5 twilight zone - Apr-05

The collapse of Frontier into bankruptcy is the starkest illustration to date of the drastic tightening of operating conditions in the US aviation sector, where several leading carriers are already cutting domestic capacity and grounding older aircraft.

Fuel costs lead American to slash schedule

American Airlines said on Wednesday it would eliminate flights, cut thousands of jobs and charge most passengers $15 to check a single piece of luggage, as surging oil prices exacerbated the crisis in the US airline industry.

American revealed a series of extraordinary measures as the spot price for crude hit a record $132.70 a barrel and the cost of a barrel of oil scheduled for delivery in December 2016 surged to an all-time high of $142.14. Gerard Arpey, chief executive and chairman, said American had been forced to act. “The airline industry as it is constituted today was not built to withstand oil prices at $125 a barrel, and certainly not when record fuel expenses are coupled with a weak US economy.

EDITOR’S CHOICE

Airlines keep up the chase for coy Continental - May-02 Cuts follow American Airlines loss - Apr-16 American’s lost flights for week hit 3,000 - Apr-11 Frontier Airlines files for bankruptcy - Apr-11 Wave of safety checks snarls US travel plans - Apr-10 American cancels another 1,500 flights - Apr-11

“Our company and industry simply cannot afford to sit by hoping for industry and market conditions to improve.”

More.

NVDL: This is the death knell for the majority of long distance carriers. Probably 90% of the world's airlines are now out of commission based on the fact that they can no longer operate profitably.

American, the only US legacy airline to have avoided bankruptcy, said rising fuel prices would add $3bn to its annual expenses. Its shares fell 16 per cent in early New York trading, leading the sector lower amid speculation that competitors would also have to raise fees.

American, the world’s largest carrier, said it would make deep cuts to its flight schedule and retire at least 75 aircraft. Facilities would close and thousands of jobs be cut, it said.

American said it had been hit with $1.9bn more in annual expenses since March when crude oil rose from an average price of $105 per barrel to $130.

Oil futures have surged 35% in 5 months (7% per month): Oil prices pass $133 after report of supply drop

NEW YORK (AP) — Runaway oil prices blew past $130 a barrel for the first time Wednesday and kept going, while gasoline prices persisted in their own relentless climb, rising above $3.80 a gallon. Supply worries, rising demand and a slumping dollar are conspiring to make filling up the car — and paying for just about everything else — a growing burden for Americans.

Analysts say crude has been boosted in recent days by especially strong demand for diesel in China, where power plants in some areas are running desperately short of coal and certain earthquake-hit regions are relying on diesel generators for power.

Only serious "demand destruction," a jump in supplies from Nigeria or other oil producing nations or a jump in gasoline output by U.S. refiners could stop prices from continuing to rise, Rafield said. There is little sign that demand will fall anytime soon in fast-growing China, India and the Middle East, she said.

More.

Serenity Now, Panic Later

“For everybody out there, the question is how can the stock market go up if oil is going to keep on doing this,” says William Lefkowitz, chief options strategist at vFinance Investments. “People are concerned this might continue.”