News You Really Need To See: “Rebels Target Colombian Bright Spot: Oil”

“Rebels Target Colombian Bright Spot: Oil”

The Wall Street Journal, November 8-9, 2014, p.A7

http://online.wsj.com/articles/colombian-rebel-attacks-set-back-nation-1415399080

“The recent blast was routine: Marxist rebels detonated dynamite remotely by cellphone along the Caño Limon oil pipeline, scorching the jungle as it blew up its target.  And once again, an economic lifeline for Colombia—a 480-mile pipeline that can carry 220,000 barrels of crude a day to a Caribbean port—closed for repairs.  ‘The guerrillas gave us advance notice, so I sent the kids home a bit early,’ said Melida Wilches, a teacher at a school adjacent to pipeline mile-marker 79, where the blast occurred.  Over the past two years, attacks by rebels against Colombian pipelines have punctured a hole in the progress and the self-assuredness of one of Latin America’s most dynamic economies and raised questions about the outlook for Colombia as a reliable provider of crude to the U.S.  Following a boom by a sector that President Juan Manuel Santos had called an economic locomotive—when oil production doubled to one million barrels a day—the sector contracted by 2.2% in the second quarter, even as Colombia’s GDP rose 4.3%. … The situation has become so delicate for the government that Mr. Santos publicly said in late July that continued attacks by the Revolutionary Armed Forces of Colombia, or FARC, could jeopardize peace talks aimed at ending a half-century of conflict with that main rebel group.”

Quickie Analysis:  Marxist insurgencies just aren’t good for the economy.

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