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Wednesday, 5 December 2012

DB bigs up Greek gas reserves as Citicorp predicts 2013 Grexit

Deutsche Bank has just issued a report saying Greece should earn €214bn from Natural Gas by 2020, based on the reserves hidden in the Mediterranean Basin south of Crete. But Citicorp says the Greeks will leave the eurozone long before that.
Until recently, it was EU policy to downplay the size of Greek energy reserves, while the Americans were bigging up the energy potential and promoting the Israel-Cyprus-Greece consortium idea for exploration. But now the situation has changed: it is no longer the EU buying, but Merkel selling.
Hence the DB document suddenly coming out with stuff like this:
‘Such a reserve would be equivalent to 107% of Greek GDP by 2020.’

The evidence suggests that this is the start of a planned Berlin spin operation to transform Greece from Black Hole to Great Investment in the eyes of the German People by Autumn 2013. That’s when Frau Doktor Merkel faces the electorate again.
“There’ll be a lot more like this,” says a source close to the Government in Berlin. “The idea is to use every means at their disposal to suggest that Greece really will be able to function without help after 2020.”
A Frankfurt-based source agrees. “This is exactly what we’d expect Merkel to do. But in fact what she has done is put Germany into a position where it will end up in financial ruin.”
Greek media are also suspicious of the sums being talked about. Kathimerini recently commented that ‘Estimates alone mean nothing, until Greece proceeds with the exploration and identification of clear and detailed geological systems that meet the requirements for the generation and accumulation of oil.’ And if Athens is having its infrastructure sold off, how will its People benefit from the gas finds even if they’re real?
Respected website keeptalkinggreece is similarly sceptical: ‘the scale and valuation figures mentioned are tenuous, and one should hold these estimates at a considerable arm’s length.’ A trusted Slog source in Greece remarks, “If [the Greeks] survive the next 8-10 years, they will live happily ever after. Don’t ask me what they will eat until 2020.”
It does sound like a question of having the energy under one’s feet, but not having the energy to dig it up. But Citicorp says the assumption of a Greek presence in the eurozone by 2020 is a fantasy anyway. Italy, Spain and Greece will need debt restructures next year, says Michael Saunders, Citi’s chief European economist. In a secret report nevertheless leaked to the media yesterday, the banking group said it expects Greece’s exit from the eurozone probably before the end of 2013.
By then, of course, Geli the German will have been re-elected. If things stay on an even keel elsewhere.

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