Chapter 707: Impact of the Oil Crisis and Its Solution
Chapter 707: Impact of the Oil Crisis and Its Solution
The Hong Kong government also immediately convened an emergency meeting to discuss how to deal with this matter, but no oil means no oil, and even developed countries cannot cope with it, let alone a mere city like Hong Kong;
Inside the Governor's House, after hearing his subordinates' description, MacLehose immediately asked, "What did you say? Mobil is going to ship the oil in Hong Kong back to the United States?"
The governor, Robert, nodded and said, "Yes, the boss of the Mobil Hong Kong Company told me that all the oil in Hong Kong needs to be shipped back to the United States."
"That won't work. If the fuel goes to the United States, what will happen to our fuel in Hong Kong?" Murray MacLehose quickly objected.
Mobil is the largest oil company in Hong Kong. It does not have any oil or derivative production industry in Hong Kong, but it has a small oil depot;
In the early years, at the beginning of the 20th century, Hong Kong was an important oil depot base for Mobil in Asia. Before electric lights became popular, kerosene, gasoline, diesel, lubricating oil, etc. from Hong Kong, most provinces in the Mainland, and even some Asian countries were stored in Hong Kong.
After the 50s, the mainland market was closed to overseas energy companies. In addition, Southeast Asian countries also began to have their own oil and gas resources and storage facilities. The importance of the Hong Kong oil depot naturally decreased, but the previous facilities are still there, so there are still a lot of reserves, which are used by Mobil as a transit storage base.
The Hong Kong government didn’t care about this before. Hong Kong has never been short of oil anyway. Even if it was short of oil, with so many shipping companies in Hong Kong, any ship would be enough for Hong Kong for a long time. But unexpectedly, a global oil crisis suddenly caught everyone off guard.
The Chief Minister Roberts said with some embarrassment: "Mr. Governor, we have no right to interfere with Standard Oil. Not to mention how huge a multinational corporation it is, even if it is an ordinary company, if we use administrative orders, it will undermine the principle of 'market freedom' in Hong Kong."
"."McLehose suddenly felt a headache;
"Market freedom" is the economic management model that the Hong Kong government has always advocated. There are two advantages to this. The first is that it saves the government's energy and avoids getting involved in the struggles between various financial groups. In particular, the confrontation between British and Chinese capital also involves political factors, so it is better for the Hong Kong government to stay out of it. The second is to use this as the core selling point to attract overseas funds, while also avoiding excessive intervention by the British government in the Hong Kong government.
There is a shortage of oil in Hong Kong now, but this cannot break the rules that we have set for decades. After all, you cannot violate the principles you have set when you need to.
At this time, another foreign official asked: "Can we negotiate with the people from Meifu to at least keep some of it in Hong Kong? The price is easy to negotiate."
Now, the question of how much various types of fuel cost is no longer a question of quantity, but rather that you may not be able to buy them even if you have money. Therefore, you have to buy them no matter how expensive they are. Otherwise, the entire society may come to a standstill due to lack of fuel, and the losses caused will be so great that they cannot be counted.
Robert shook his head and said, "I've already told him, but this is an order from the Mobil headquarters, and he has no right to object, unless we go to the United States to find someone at their headquarters, but as you all know, this is impossible."
The other officials were suddenly silent;
The Governor, the Chief Commissioner and some officials of Hong Kong do have great power in Hong Kong, but they are useless outside Hong Kong and in other parts of Asia. If they go to the United States, an ordinary small company will not pay attention to them. The Mobil Group is the world's top oil group. Even the President of the United States has to give it some face. What can these Hong Kong officials do to them?
MacLehose then asked: "What about companies like Shell and Caltex?"
Roberts replied: "They also have some refined oil, but the quantity is very small. Mobil is the only oil depot in Hong Kong. Other fuel companies only have a small basement. These oils can generally only be used in the Hong Kong market for one or two months.
Moreover, too many people are scrambling for oil now. Even some companies are trying to stockpile oil. This will inevitably lead to the oil reserves in Hong Kong running out very quickly. I estimate that they may not last for half a month.”
For any commodity, there is a fear of hoarding, just as there is a run on a bank;
When there is no problem with market supply, everyone will buy when they need it. It is impossible to spend their own space to stockpile a certain commodity, especially flammable goods. No one is willing to take the risk.
But once there is a trend that a product will be out of stock, and it is a very important oil, it will inevitably make many people want to stock up on it even if there is no shortage in the short term, in order to avoid being out of stock in the future;
When everyone thinks this way, then it's all over. Not to mention fuel, even the various foods in the supermarket can't withstand such a rush to buy.
An elderly official frowned and said, “Yes, a similar situation occurred 10 years ago when Hong Kong was short of water. Many people desperately hoarded water, causing the Hong Kong government’s supply to not keep up.
If Changxing Group had not used a large number of ships to fetch water from the mainland and Taiwan, the problem would have been even more serious.”
"Changxing Group?" MacLehose thought for a moment and said, "Yang Wendong has his own businesses in Europe and the United States. Perhaps he has some channels we don't know about that can be used to buy oil? Do you think it's possible?"
Compared with local conglomerates that have done very successful business overseas, the local government's overseas connections may not be comparable.
Luo Bishi replied: "Perhaps it is possible. Otherwise, I will go and ask."
"Okay, go ask. There's no loss if it doesn't work." Murray MacLehose nodded.
At the moment, he could only try his best. He actually knew that not only Hong Kong, but even the UK was beginning to run out of oil.
The Middle East took action first, causing 30% of the global damage, but the subsequent hoarding of oil by various capitals directly caused a global energy supply shortage. However, there is nothing that can be done about it. After all, capitalist society is all about "freedom". People just want to buy oil, so why should you stop them?
A week after the oil crisis broke out, Yang Wendong was also on the top floor of Kangle Building, reading through information sent by various parties.
"This oil crisis has a significant impact on us." After reading it, Yang Wendong frowned and said, "We are not short of oil and raw materials for the time being, but other suppliers can't buy goods, even oil, which is really a big impact."
As the largest manufacturing group in Hong Kong, Yang Wendong certainly wants to build a full industrial chain, but it does not mean that he owns all of it. Instead, he selectively supports various suppliers to build upstream and downstream together and form an alliance of interests.
But no matter what supply chain it is, it is vulnerable to a major disaster like the oil crisis. If there is a problem at one point in the chain, it will affect the entire chain, not to mention that many points are not working now. The lack of oil alone is enough to cause a headache.
Wei Zetao replied: "I have a lot of plastic pellet raw materials in Hong Kong. It is not difficult to sell them at the market price. But as for fuel oil, we don't have much in reserve. Although we can share some of it, I am worried that if the situation in the Middle East is not resolved in a few months, we will not be able to buy fuel ourselves."
Now, he admired Yang Wendong's previous actions. It seemed that he felt that something would go wrong in the Middle East, otherwise he could not explain his previous behavior.
It seems that his boss not only has a good business sense, but also has a very sharp vision in politics. Even if he didn't predict the oil crisis, he must have guessed that the Middle East would do something. Yang Wendong thought for a while and said, "First, give some to important suppliers and ask them to find a way to buy some fuel. They can't rely on us. First, ensure the normal operation of the company. I will think of a solution later."
He had predicted early on that there would definitely be problems with the fuel, but there was nothing he could do.
Even if Changxing Group has enough funds and can stockpile plastics, which is safer and has lower costs, for something like fuel, just building a qualified fuel reserve base requires preparation several years in advance, plus the permission of the Hong Kong government. Changxing Group is not involved in these businesses, so how could it possibly invest in them?
"Okay, I'll arrange it right away." Wei Zetao paused, then said, "Hong Kong won't have any major problems in the short term, but our overseas bases have also been affected."
"Singapore? There's no oil there either?" Yang Wendong asked, "Singapore is an important port, right?"
Wei Zetao said: "In the short term, there should still be some, but the price is a bit expensive, but in the long term, it is unclear. The main reason is that European and American countries are also trying to find ways to ship oil back to their countries, and it is European and American companies that control the world's oil."
"Well, let's take it one step at a time. We can accept that the fuel price is a little higher. As long as we can buy it, it's good. In this crisis, it's impossible not to spend more money." Yang Wendong nodded, and then said: "The price of the plastics we stockpiled in Hong Kong has doubled now, and it may be even higher in the future. Compared with this, the price increase of other fuels is nothing. The core issue is to ensure that there is enough."
Plastics are petroleum derivatives. When oil prices soar, plastic prices also increase exponentially, with similar proportions.
The hoarding of plastics is much easier than oil. He has already hoarded hundreds of thousands of tons in warehouses in Hong Kong. If he waits until the price is the highest and sells them now, he can easily make tens of millions of dollars. Compared with this profit, normal oil will not make much money even if it increases several times. After all, it is only used for transportation, not as raw materials.
But if you can't buy oil, there will be problems with transportation, which will affect production. In this way, the losses caused will be very large. If the shortage leads to the loss of market, it will not only be a matter of profit.
"Okay, I will inform the overseas company." Wei Zetao agreed.
At this moment, Assistant Aying knocked on the door and came over, saying, "Mr. Yang, the Governor's Office called and the Governor wants to invite you to meet for tea at Qingshan Teahouse at 10 a.m. tomorrow."
"Luo Bishi?" Yang Wendong thought for a moment and said, "Okay, I will be there on time tomorrow morning."
Often when the Hong Kong government looks for someone to discuss something, it is not always the Governor himself. After all, the Governor may not be in Hong Kong or may have other things to do. Therefore, the Governor will often be involved in some matters in the business world.
In many cases, the governor would even show up more often.
The next morning, Yang Wendong brought Fang Xianming to Qingshan Teahouse, a large teahouse on the edge of Hong Kong Island. Many business people like to come here because it is well concealed and is not a five-star hotel. Journalists rarely come here either.
"Hello, Mr. Governor." After seeing Luo Bishi, Yang Wendong immediately shook hands with him politely.
Luo Bishi also returned the greeting and said, "Hello, Mr. Yang, please take a seat."
The two had met many times before, and they were acquaintances if not friends, so after exchanging pleasantries for a while, Robert went straight to the point and said, "Mr. Yang, you are aware of the global oil crisis, which has a great impact on Hong Kong.
Hong Kong now has very little oil reserves, but the problem is that it is not possible to buy oil on the international market. If this continues, once there is an oil shortage, it will be a fatal blow to Hong Kong's economy. As the largest manufacturing factory in Hong Kong, Mr. Yang's company will inevitably be greatly affected.
So I asked you out to discuss how to solve this problem. "
"This is a headache for me too, but I really don't have any solution. It's not just Hong Kong that is short of oil, it's the same in Europe and the United States as well." Yang Wendong shook his head and said.
Of the three oil crises in human history, the first one had the greatest impact on the global economy. The second and third ones were more or less prepared because of the experience of the first one. Especially the third one, at that time, all countries had oil reserves and developed domestic oil fields to ensure self-sufficiency. In addition, the Kuwait crisis ended quickly, so there was almost no impact.
This is even the reason why there has not been a fourth oil crisis in human history, because it really has little effect;
But this first time was the most fatal. When oil was most scarce, the French government was so anxious to find oil in the land under the city of Paris.
He can still spend a little more money to keep his company running normally, but he really has no way to deal with the needs of Hong Kong as a whole. Even if his own business is affected a little, it is to be expected and it is impossible to avoid it completely. If he is prepared, he will definitely be much better than his peers, and that is enough.
Luo Bishi paused and said, "Actually, I do have a method. If Mr. Yang is willing to help, it may be successful and solve Hong Kong's oil shortage problem."
"Oh, tell me about it." Yang Wendong immediately became interested. If Hong Kong did not lack oil, it would also be good for his business.
Roberts said: "Mr. Yang, it is true that all Western countries are short of oil now, but many non-Western countries are not affected by this oil crisis."
"You mean, the mainland?" Yang Wendong immediately guessed what the other party meant.
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(End of this chapter)