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The Same Old Song on High Gas Prices
David M. Herszenhorn, New York Times
WASHINGTON – Representative Debbie Wasserman Schultz peered down at the executives from the nation’s biggest oil companies, arrayed before the House Judiciary Committee like five targets in a carnival dunk tank, wearing dark suits and ties instead of swim trunks.
It was the Thursday before the Memorial Day weekend – the ideal time for Congress to show its solidarity with angry American motorists. Ms. Wasserman Schultz, Democrat of Florida, channeled the rage of every parent in America who has pulled into a gas station recently on the way to ballet lessons or soccer practice, letting loose on the men from Exxon Mobil, Shell, Chevron, ConocoPhillips and BP America.
“I’m a mom of three young children who filled up her minivan the other day for $68,” she said, seething. “Sixty-eight dollars – that’s real money. Maybe that’s not real money to the five people sitting here because $68 is like a nickel to you, based on the income you all earn.”
… In what has become a regular show in the hearing rooms on Capitol Hill, the oil company executives took a second day of lashings on Thursday. On Wednesday, they went through a similar exercise with the Senate Judiciary Committee.
… But neither those initiatives nor a portfolio of others currently under consideration are likely to reduce prices at the pump. And so the lawmakers and the oil titans, well aware of this reality but also mindful of the roles they are expected to play, ran through a familiar script.
The executives firmly insisted that global market forces beyond their control were to blame for high prices.
(23 May 2008)
Submitted by prolific contributor John who notes:
Scroll down the page and on the left side under “Related” is a short (1:26) interview with Matt Simmons as well as three others
Obama’s Secret War Profiteering Tax
Greg Palast, TomPaine.com/OurFuture.org via Campaign for America’s Future
I can’t make this up:
In a hotel room in Brussels, the chief executives of the world’s top oil companies unrolled a huge map of the Middle East, drew a fat, red line around Iraq and signed their names to it.
The map, the red line, the secret signatures. It explains this war. It explains this week’s rocketing of the price of oil to $134 a barrel.
It happened on July 31, 1928, but the bill came due now.
Let me explain.
In 1928, oil company chieftains (from Anglo-Persian Oil, now British Petroleum, from Standard Oil, now Exxon, and their Continental counterparts) were faced with a crisis: falling prices due to rising supplies of oil; the same crisis faced by their successors during the Clinton years, when oil traded at $22 a barrel.
The solution then, as now: stop the flow of oil, squeeze the market, raise the price. The method: put a red line around Iraq and declare that virtually all the oil under its sands would remain there, untapped. Their plan: choke supply, raise prices rise, boost profits. That was the program for 1928. For 2003. For 2008.
Again and again, year after year, the world price of oil has been boosted artificially by keeping a tight limit on Iraq’s oil output. Methods varied. The 1928 “Redline” agreement held, in various forms, for over three decades. It was replaced in 1959 by quotas imposed by President Eisenhower. Then Saudi Arabia and OPEC kept Iraq, capable of producing over 6 million barrels a day, capped at half that, given an export quota equal to Iran’s lower output.
In 1991, output was again limited, this time by a new red line: B-52 bombings by Bush Senior’s air force. Then came the Oil Embargo followed by the “Food for Oil” program. Not much food for them, not much oil for us.
In 2002, after Bush Junior took power, the top ten oil companies took in a nice $31 billion in profits. But then, a miracle fell from the sky. Or, more precisely, the 101st Airborne landed. Bush declared, “Bring’m on!” and, as the dogs of war chewed up the world’s second largest source of oil, crude doubled in two years to an astonishing $40 a barrel and those same oil companies saw their profits triple to $87 billion.
Greg Palast is the author of, “Trillion Dollar Babies,” on Iraq and oil, published in his New York Times bestseller, Armed Madhouse.
(22 May 2008)
Sounds unlikely to me, as do most conspiracy theories, which try to explain complicated political-economic situations as the result of an organized cabal. Oil prices are rising for a variety of reasons, but fundamentally because of supply and demand as we enter a peak or plateau of oil production. The Iraq War seems to me a complicated mix of bad judgment, neo-conservative enthusiasm and desire to dominate an oil-rich region. Rather than deal with this complexity, Greg Palast chooses the easier path of blaming a small band of villains. Note too that the international oil companies (IOCs) such as the one that Palast blames (Exxon, etc.) do not monopolize the oil industry as they once did. The national oil companies (NOCs) like Gazprom are now dominant.
Palast has previously attacked peak oil, based on what I think is a misunderstanding. (See also EB excerpts/comments and Richard Heinberg’s rebuttal.) -BA
