THE TAINTED TRUST (Volume 2 of The King Trilogy)

CHAPTER 75

        Despite frenzied trading in the wake of the invasion of Kuwait, West Texas Intermediate ended the day off the boil. Near record stockpiles of petroleum worldwide had tempered the fears of investors and speculators. Visconti's margin call, while still large, was reduced to a mere forty-three million. His determination to play the game had been reinforced. The game had blossomed into a personal crusade.

August 3, 1990.

Iraq said it would withdraw its troops, "As soon as things settle, and when Kuwait's free provisional government asks us to do so. We hope this will be in a few days, or a week at the latest."

Miles Dennis frowned as he watched the latest bad news on the moving electronic tape. "U.S. intelligence have monitored a buildup of one hundred thousand Iraqi troops south of Kuwait City, near the Saudi border."

Fears of an invasion of Saudi Arabia drove the price of crude oil much higher.

August 4, 1990.

More bad news glided across Iacardi's electronic tape. "Iraqi forces have entered the Neutral Zone on the Kuwaiti-Saudi border, a disputed territory from which both countries draw oil."

In spite of Baghdad's denial of the report, fear and tension drove the price of oil still higher.

August 6, 1990.

Turkish president, Turgut Ozal said his country would obey United Nations sanctions and stop unloading Iraq's oil at its pipeline terminus. Until then, Iraq had exported eighty to ninety percent of its oil through two long overland pipelines: one through Turkey to the Mediterranean port of Yamurtauk, the other across the Saudi Arabian desert to the Red Sea port of Yanbu.

The removal of much of Iraqi oil from world markets put further upward pressure on oil prices.

August 8, 1990.

In a stunning announcement, Iraq declared that it had annexed Kuwait as its nineteenth province, calling it Kadhimat and making it clear to the world it had no intention of leaving. With the annexation Saddam declared, "Thank God we are all now one people, one state that will be the pride of all Arabs."

Saddam's intention was to create a regional superpower with enormous economic strength. Together, Iraq and Kuwait had proven reserves of one hundred and ninety-five billion barrels of oil, twenty percent of the world's reserves and second only to Saudi Arabia's two hundred and fifty-five billion barrels.

The spot price shot above twenty-eight dollars per barrel and financial markets were hurled into turmoil.

Kerri watched nervously as the price of oil shot skyward. Her tolerance collapsed when she watched it knife through twenty-eight. Sickened by the sights provided by the moving electronic tape, she jumped to her feet and stormed into Dennis's office. "It's above twenty-eight!" she announced. "We've got to get Louis out!"

"I've given up," Dennis said with a cold stare and a shrug of his shoulders. "I've called every day this week and tried to convince him to get out. I can't believe it. He's absolutely obsessed with this thing."

"Then I'm going to talk to him," Kerri declared. "Somebody's got to stop him."

"That's a noble gesture, but not a good idea."

"Why? I'm sure if I..."

"Every business decision should be made objectively. If Louis's decision is based on your advice, and it turns out to be improvident, he might never forgive you. In other words, the strength of your relationship could work against you. I think it's more important than money, don't you?"

Kerri nodded, reluctantly accepting Dennis's advice.

"I'll call him again," Dennis said, then lifted his receiver and dialed Visconti's number. He used his left hand to beckon Kerri to stay while he waited for his call to be transferred to Visconti.

"I bet you're calling to convince me to liquidate," Visconti said.

"You're farting against a hurricane, Louis. I'm sure you know it's above twenty-eight and climbing."

"Give it another day or two, Miles," Visconti replied, so calmly that Dennis was unable to detect the churning in the pit of his stomach.

Dennis slammed the receiver into its cradle, then lifted his hands above his shoulders and stared at the ceiling. "He's insane, absolutely certifiable!"

"Maybe, but I still love him," Kerri said, then hurried from Dennis's office.

August 9, 1990.

George Bush issued a statement confirming that the U.S. would draw against the six hundred million barrels of oil in its Strategic Petroleum Reserve as a means of easing upward pressure on oil prices. Simultaneously, the International Energy Agency, comprised of twenty-one industrialized nations, urged heightened preparations to meet the need for alternative oil supplies. The two moves, combined with reports that some O.P.E.C. nations planned to boost production, pushed the spot price down to slightly below twenty-six dollars.

Late in the afternoon, Visconti called Dennis and ordered the liquidation of his August contracts. "I'm keeping the September contracts to the death, Miles!" he vowed, well aware that the loss sustained by the King's trust was horrendous.