Abu Dhabi has announced the acquisition of Pioneer Natural Resources' Canadian Unit, which makes it the fifth overseas acquisition since November by Abu Dhabi National Energy Co., the United Arab Emirates' investor in oil and power assets.While some might argue that the Arab world has a base of knowledge and comfort level in dealing with investments in the oil patch, an alternative principle might be worthy of consideration for these investors: the need to diversify the portfolio. Since Abu Dhabi is dependent on the fortunes of the oil industry, a strictly return-to-risk calculation might argue for investment outside the energy sector. However, maybe another consideration is in play: a geopolitical one. Are the Arab nations determined to control the flow of Western-based oil and natural gas, thereby increasing the Western world's dependence on them? Is the goal to control al the world's energy resources?These sovereign wealth funds are perilous. They look like they are being deployed...(Read Full Post)