Текст книги "Treasure of Khan"

Автор книги: Clive Cussler

Соавторы: Dirk Cussler
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Текущая страница: 11 (всего у книги 33 страниц)

-12-

"Jan, we're on in ten minutes in the Gold Conference Room. Can I get you a coffee before we start?"

Jan Montague Clayton stared at the coworker standing in her doorway like he'd just landed from Mars.

"Harvey, my urine has turned the color of cappuccino, and there's enough caffeine in my bloodstream to fuel the space shuttle. But thanks anyway. I'll be along in a moment."

"I'll make sure the projection system is set up," Harvey replied sheepishly, then disappeared down the corridor.

Clayton couldn't count the number of coffees she had consumed in the last two days, but knew it had been her primary sustenance. Since the news of the earthquake at Ras Tanura had broken the day before, she had been glued to her desk, developing economic impact assessments while quietly gathering oil company reactions from the slate of industry insiders that filled her Rolodex. Only a brief foray to her stylish apartment in the East Village at two in the morning for a catnap and change of clothes had offered a respite from the state of chaos that surrounded her.

As a senior commodities research analyst for the investment banking firm of Goldman Sachs, Clayton was used to working twelve-hour days. But as a specialist in oil and natural gas futures, she was unprepared for the fallout from Ras Tanura. Every sales associate and fund manager in the firm seemed to be calling her, crying for advice on how to handle their clients' accounts. She finally had to unplug her phone in order to concentrate, while steering well clear of her e-mail account. Taking a last look at some oil export figures, she stood and patted down her beige Kay Unger suit, then picked up a laptop computer and headed for the door. Against her better judgment, she stopped suddenly and wheeled back toward the desk, where she scooped up a ceramic cup half full of coffee.

The conference room was a packed house, the mostly male crowd waiting anxiously for her report. As Harvey opened the meeting with a brief economic overview, Clayton studied the audience. The sprinkling of partners and senior managers was easy to spot, their premature-gray hair and paunch bellies signaling the lifetime of hours spent inside the building's walls. At the other spectrum were the younger sales associates, cutthroat and aggressive in their desire to climb the firm's ladder to the holy land of seniority, where seven-figure year-end bonuses were regularly pocketed. Half of the overpaid and overworked investment professionals didn't care whether Clayton's predictions would be accurate or not so long as they had someone to blame for their trades. Yet those who paid attention quickly learned that Clayton knew her stuff. In the short time she had been with the firm, she had already acquired the reputation as a savvy analyst with an uncanny ability to predict trends in the market.

"And Jan will now discuss the current state of the oil markets," Harvey concluded, passing the stage to Clayton. Plugging her laptop into the projection system, she waited a moment for her PowerPoint presentation to appear on the screen. Harvey walked to the side of the conference room and closed the blinds of a large picture window that offered an impressive view of lower Manhattan from the Broad Street high-rise.

"Ladies and gentlemen, this is Ras Tanura," she began, speaking in a soft but confident voice. A map of Saudi Arabia jumped to the screen, followed by photos of an oil refinery and storage tanks.

"Ras Tanura is Saudi Arabia's largest oil and liquid natural gas export terminal. Or was, rather, until yesterday's massive earthquake. Damage assessments are still under way, but it appears that nearly sixty percent of the refinery was destroyed by fire and that at least half of the storage facilities suffered major structural damage."

"How does that impact oil exports?" interrupted a jug-eared man named Eli, munching on a doughnut as he spoke.

"Hardly at all," Clayton replied, pausing to let Eli take the bait.

"Then why the big oil shock?" he asked, crumbs spraying off his lips.

"Most of the refinery's output is utilized by the Saudis themselves. What will impact oil exports is the damage incurred to the pipelines and shipping terminals." Another image appeared on the screen, showing a dozen supertankers docked at the Sea Island loading terminal.

"Those floating terminals should have been safe from the earthquake at sea," someone commented from the rear of the room.

"Not when the epicenter of the earthquake was less than two miles away," Clayton countered. "And those aren't floating terminals, they are fixed in the seabed. Shifting sediments from the earthquake caused a complete collapse of this offshore terminal, which is known as Sea Island. The Sea Island terminal handles the largest of the supertankers and that capacity has been completely wiped out. Several additional shore-based loading piers were destroyed as well. It appears that over ninety percent of Ras Tanura's export infrastructure has been damaged or destroyed. That is why there has been a 'big oil shock,' " she said, staring at Eli.

A hushed gloom fell over the room. Finally finishing his doughnut, Eli broke the silence.

"Jan, what kind of volume does that translate to?"

"Nearly six million barrels a day of Saudi export oil will immediately be removed from the supply chain."

"Isn't that nearly ten percent of the daily world demand?" a senior associate asked.

"It's closer to seven percent, but you get the picture."

Clayton brought up the next slide, which showed the recent spike in price of a barrel of West Texas intermediate crude oil, as traded on the New York Mercantile Exchange.

"As you know, the markets have reacted with their usual rabid hysteria, blasting the spot price of crude to over one hundred twenty-five dollars a barrel in the last twenty-four hours. Those of you in equities have already seen the resulting collapse on the Dow," she added, to a chorus of groans and nodding heads.

"But where do we go from here?" Eli asked.

"That's the sixty-four-dollar question, or one-hundred-twenty-five-dollar, rather, in our case. We're dealing in fear at the moment, driven by uncertainty. And fear has a habit of producing irrational behavior that isn't easy to predict." Clayton stopped and took a sip from her coffee. She had her audience hanging on every word. Though her attractive looks always drew attention, it was her knowledge that had the crowd enraptured now. She savored the taste of power for a moment, then continued.

"Make no mistake. The destruction at Ras Tanura is going to leave a devastating mark around the world.

On the home front, there's going to be an immediate whack to the domestic economy that will rival the post 9/11 downturn. When that one-hundred-twenty-five-dollar barrel of oil trickles down to seven dollars for a gallon of gas next week, Joe Consumer is going to park his Hummer and start riding the bus.

Higher prices for everything from diapers to airline tickets will ripple through the economy. No one is prepared for that degree of run-up in price, which will throw a roadblock to consumer purchasing in short order."

"Is there anything the president can do to help?" Eli asked.

"Not much, though there are two things that might soften the blow. Our country's Strategic Petroleum Reserve is now sitting at full capacity. If the president so elects, he could draw down on the reserves to replace some of the shortages from Saudi Arabia. In addition, the drilling in the Arctic National Wildlife Refuge approved by the prior administration has now come on line, so the Alaska Pipeline is now running at full capacity again. That will provide a slight boost to domestic production numbers. Neither item will be sufficient to prevent fuel shortages in some regions of the country, however."

"What can we expect in the long term?" he inquired.

"While we can't forecast the impact that fear will have on the markets, we can predict the dynamics of supply and demand that will ultimately prevail. The spike in price should soften current levels of demand over the next few months, easing the pressure on oil prices. In addition, the other ten OPEC countries will clamor to make up Saudi Arabia's lost exports, though it is unclear whether they have the infrastructure to cover the shortfall."

"But wouldn't OPEC want to keep the price of oil over one hundred dollars?" Eli pestered.

"Sure, if demand stayed constant. But we're going to face a sharp economic contraction as it is. If the price was maintained at one hundred twenty-five dollars arbitrarily, you would see a global economic collapse rivaling the Great Depression."

"You don't think that's in the cards?"

"It's possible. But OPEC doesn't want to see a worldwide economic collapse any more than the industrialized nations do, as that will reduce their revenues. The main concern today is still one of supply.

We witness another supply disruption, then all bets are off."

"So what's the investment play?" Eli asked pointedly.

"Initial estimates from Ras Tanura suggest that the shipping terminals can be repaired or replaced within six to nine months. My trading recommendation would be to short oil positions at the current price, with the expectation that pricing will retreat to more moderate levels within nine to twelve months."

"You're sure of that?" asked Eli with a hint of skepticism.

"Absolutely not," Clayton fired back. "Venezuela could be hit by a meteorite tomorrow. Nigeria could be taken over by a fascist dictator next week. There are a thousand and one political or environmental forces that could disrupt the oil markets in a heartbeat. And that's the unnerving point. Any bit of further bad news may drive us past a recession and into a depression that will take years to recover from. But it seems a bit tenuous to me to assume that another natural disaster will strike soon with the impact of Ras Tanura. Are there any more questions?" Clayton asked, reaching her final slide.

Harvey opened the window shades, letting in a blast of sunlight that made everyone in the room squint for a moment.

"Jan, my desk trades in global equities," stated a short blond woman in a garnet-colored blouse. "Can you tell me which countries are most vulnerable to the reduced Saudi oil exports?"

"Sandra, I can only tell you where the Saudi oil exports are currently going. The U.S., as you know, has been a prime customer of Saudi oil since the 1930s. Washington has long pursued a goal of reducing our reliance on Middle East crude, but Saudi oil still accounts for nearly fifteen percent of our total imported oil."

"How about the European Union?"

"Western Europe obtains most of their oil from the North Sea, but Saudi imports do play a factor. Their proximity to other suppliers should mitigate severe shortages, I believe. No, the hardest-hit countries will be in Asia."

Clayton drained the last of her coffee while she pulled up a file on her computer. She curiously noted that the occupants of the entire room remained seated and listening to her every word.

"Japan will feel a major jolt," she said, scanning the report. "The Japanese import one hundred percent of their oil requirements and were already stung by the recent earthquake in Siberia that took out a section of the Taishet-Nakhodka pipeline. Though not widely publicized, that accident had already pushed the price of oil up three to four dollars a barrel," she noted. "I can tell you that Japan imports twenty-two percent of its oil from Saudi Arabia, so they will feel a significant contraction. However, a temporary boost in Russian oil exports could take away something of the strain once the Siberian pipeline is repaired."

"And China?" an anonymous voice asked. "What about that fire near Shanghai?"

Scanning down the page, Clayton furrowed her brow.

"The Chinese will be facing a similar shock. Nearly twenty percent of China's oil imports come from Saudi Arabia," she said, "all of which arrives by tanker ship. I haven't assessed the impact of the fire at the Ningpo oil terminal, but I can only speculate that combined with the Ras Tanura disaster, the Chinese will be facing a major hurdle in the near term."

"Are alternative sources available to the Chinese?" a voice in the back asked.

"Not readily. Russia would be the obvious source, but they are more inclined to sell their oil to the West and Japan. Kazakhstan might provide some relief, but their pipeline to China is already at capacity. I think there could be a dramatic impact to the Chinese economy, which is already suffering a shortage of energy resources." Clayton made a mental note to review the Chinese situation in more depth when she returned to her office.

"You mentioned domestic fuel shortages earlier," a pasty-faced man in a purple tie asked. "How severe will that be?"

"I would expect only temporary shortages in limited areas, assuming no other market impacts. Again, the main problem we are facing is fear. Fear of another supply disruption, either real or imagined, is the real culprit that could drive us to a complete meltdown."

The meeting wound down as the crowd of financiers glumly scurried back to their gray work cubicles.

Clayton gathered her laptop and headed for the door as a figure drew up alongside her. Turning her head, she gazed with apprehension at the slovenly figure of Eli, a doughnut crumb on his tie.

"Great meeting, Jan." Eli grinned. "Can I buy you a cup of coffee?"

Gritting her teeth, all she could do was smile and nod.

-13-

It was a stifling day in Beijing. A suffocating conflux of heat, smog, and humidity doused the congested city in a thick soup of misery. Tempers flared on the streets as cars and bicycles jostled for position in the jammed boulevards. Mothers grabbed their children and flocked to the city's numerous lakes in an attempt to seek a reprieve from the heat. Teenage street vendors hawking chilled Coca-Colas made stellar profits quenching the thirst of sweaty tourists and businessmen.

The temperature was little cooler in the large meeting room of the Chinese Communist Party headquarters, situated in a secure compound just west of Beijing's historic Forbidden City. Buried in the basement of an ancient edifice inaptly named the Palace Steeped in Compassion, the windowless conference room was an odd conglomeration of fine carpets and antique tapestries mixed with cheap 1960s office furniture. A half dozen humorless men, comprising the elite Standing Committee of the Political Bureau, the most influential body in China's government, sat at a scarred round table with the general secretary and president of China, Qian Fei.

The stuffy room felt much hotter to the minister of commerce, a balding man with beady eyes named Shinzhe, who stood before the party chiefs with a young female assistant at his side.

"Shinzhe, the State just approved the five-year plan for economic progress last November," President Fei lectured in a belittling tone. "You mean to tell me that a few 'accidents' have rendered our national objectives unfeasible?"

Shinzhe cleared his throat while wiping a damp palm on his pant leg.

"Mr. General Secretary, politburo members," he replied, nodding to the other assembled bureaucrats.

"The energy needs of China have changed tremendously in the last few years. Our rapid and dynamic economic growth has driven a high thirst for energy resources. Just a few short years ago, our country was a net exporter of crude oil. Today, more than half of our consumption is supplied by crude oil imports. It is a regrettable fact due to the size of our economy. Whether we like it or not, we are captive to the economic and political forces surrounding the foreign petroleum market, just as the Americans have been for the last four decades."

"Yes, we are well aware of our growing energy appetite," stated Fei. The recently elected party head was a youthful fifty-year-old who catered to the traditionalists in the bureaucratic system with equal parts charm and wile. He had a reputation for being hot-tempered, Shinzhe knew, but respected the truth.

"How severe is the shock?" another party member asked.

"It is like having two of our limbs cut off. The earthquake in Saudi Arabia will drastically restrict their ability to ship us oil for months to come, though we can develop alternate suppliers over time. The fire at Ningbo Harbor is perhaps more damaging. Nearly a third of our imported oil flows through the port facility there. The infrastructure necessary to receive oil imports by ship is not something that can be quickly replaced. I am afraid to report that we are facing immediate and drastic shortages that cannot be easily remedied."

"I have been told the damage repairs may take as long as a year before the current level of imports can be restored," a white-haired politburo member said.

"I cannot dispute the estimate," Shinzhe said, bowing his head.

Overhead, the room's fluorescent lights suddenly flashed off, while the noisy and mostly ineffective air-conditioning system fell silent. A stillness settled over the darkened room before the lights flickered back on and the cooling system slowly clanged back to life. Along with it came the temper of the president.

"These blackouts must stop!" he cursed. "Half of Shanghai was without power for five days. Our factories are operating limited hours to conserve electricity, while the workers have no power to cook their dinner at night. And now you tell us that we will be short of fuel oil from abroad and our five-year plan is rubbish? I demand to know what is being done to solve these problems," he hissed.

Shinzhe visibly shrunk before the tirade. Glancing around the table, he saw that none of the other committee members were brave enough to reply, so he took a deep breath and began speaking in a quiet tone.

"As you know, additional generators will go on line shortly at the Three Gorges Dam hydroelectric development, while a half dozen new coal-and gas-fired power plants are in various stages of construction. But obtaining sufficient natural gas and fuel oil supplies to operate the non-hydro power plants has been a problem, and is more so now. Our state-sponsored oil companies have stepped up exploration in the South China Sea, despite protests from the Vietnamese government. Furthermore, we continue to broaden supply relationships abroad. The foreign ministry has recently completed successful negotiations to purchase significant quantities of fuel oil from Iran, I might remind the committee. And we are continuing efforts to acquire Western oil companies that own rich stocks of reserves."

"Minister Shinzhe is correct." The gray-haired foreign minister, who sat quietly to the side, coughed.

"These activities address long-term sources of energy, however, and will do nothing to solve the immediate problem."

"Again, I ask, what is being done to address the shortfall?" Fei nearly shrieked, his voice rising an octave.

"In addition to Iran, we have spoken with several Middle Eastern countries about boosting their exports.

We must of course compete with the Western countries on price," Shinzhe said softly. "But the Ningbo Harbor damage physically limits the amount of oil we are able to bring in by sea."

"What about the Russians?"

"They are in love with the Japanese," the foreign minister spat. "Our attempt to jointly develop a pipeline from the western Siberian oil fields was rejected by the Russians in favor of a line to the Pacific that will supply Japan. We can only boost rail shipments of oil from Russia in the short term, which, of course, is not a feasible means to transport any sizeable quantities."

"So there is no real solution," Fei grumbled, his anger still simmering. "Our economic growth will terminate, our gains against the West will cease, and we can all just return to our cooperative farms in the provinces, where we will enjoy continuing blackouts."

The room fell silent again as no one dared even breathe in the face of the general secretary's ire. Only the tinny rattle of the air-conditioning rumbling in the background stirred the heavy morose in the air. Then Shinzhe's assistant, a petite woman named Yee, cleared her throat.

"Excuse me, General Secretary, Minister Shinzhe," she said, nodding to the two men. "The State has just today received a peculiar offer of energy assistance through our ministry. I am sorry I didn't have the opportunity to brief you, Minister," she said to Shinzhe. "I didn't recognize the importance at the time."

"What is the proposal?" Fei asked.

"It is an offer from an entity in Mongolia to supply high-quality crude oil..."

"Mongolia?" Fei interrupted. "There's no oil in Mongolia."

"The offer is to supply one million barrels a day," Yee continued. "Delivery commencing within ninety days."

"That's preposterous," Shinzhe exclaimed, glaring at Yee with irritation for publicly sharing the communiqué.

"Perhaps," Fei replied, a look of intrigue suddenly warming his face. "It is worth investigating. What else does the proposal say?"

"Just the terms they demand in return," Yee replied, suddenly looking nervous. Pausing in hopes the discussion would end there, she sheepishly continued when she saw all eyes were fixed on her. "The price of the oil shall be set at the current market price and locked for a period of three years. In addition, exclusive use of the northeast oil pipeline terminating at the port of Qinhuangdao shall be granted, and, further, the Chinese-controlled lands denoted Inner Mongolia shall be formally ceded back to the ruling government of Mongolia."

The staid audience erupted in an uproar. Cries of outrage rocked through the room at the shocking demand. After minutes of boisterous dissent, Fei pounded an ashtray on the table to regain silence.

"Silence!" the president shouted, immediately quieting the crowd. A pained look crossed his face, then he spoke calmly and quietly. "Find out if the offer is real, if the oil does, in fact, exist. Then we shall worry about negotiating an appropriate price."

"As you wish, General Secretary," Shinzhe bowed.

"Tell me first, though. Who is it that is making this contemptuous demand?"

Shinzhe looked helplessly at Yee. "It is a small entity that is unknown to our ministry," she answered, addressing the president. "They are called the Avarga Oil Consortium."