Is Bush Really Controlling Oil Prices?

I mentioned to a friend the other day that I blame the Republicans for current gas prices, which are now at the highest level ever (even taking into account inflation since the 1982 spike). He laughed at me, saying he didn’t see how it could possibly be in their best interests to be irritating the general public to this extent. So I laid down some arguments showing just how much the current situation fits with the Republican agenda.

1.Arctic drilling. This has been a mainstay of Republican policy for years. Bills to open up the wildlife reserves to the big oil companies have been repeatedly defeated: but the longer gas prices stay high, the more willing the public will be to accept such a measure. Even though drilling there has been widely condemned for environmental reasons, such concerns have never swayed Republicans. (Think Gale Norton and her 'free-market' environmentalism, essentially a code-term for letting the business lobby do exactly as they pleased with our natural resources without fear of Federal regulation.)

2.The Saudi factor. George Bush and Prince Bandar of the House of Saud, ambassador to the USA for many years and now National Security Chief in his home country, are best of friends. Bush used to call him 'Bandar Bush' and he was a frequent visitor to Crawford. Now, we all know that OPEC operates as a cartel, and that the Saudi oilfields only account for around 10% of world oil production, or 30% within OPEC. However, within that cartel Saudi Arabia has been operating rather strangely. While most of the other members have been increasing production, the Saudis have reduced by 8% their total output.

The interesting thing here is that overall OPEC oil revenues have increased from $128 billion in 1998 to $522 billion in 2006. Meanwhile, Saudi revenues have gone from $36.9 billion to $159.1 billion over the same period.

Conclusion? Saudi Arabia is earning more money – a LOT more money – by cutting production. As the country's biggest customer, you might think that the USA had more sway over crude oil prices (remember, we're talking OPEC revenues and crude oil, not refineries). And especially considering Bush's close relationship with the House of Saud. In particular, given that oil accounts for a third of the budget deficit, you might also think that the party of 'fiscal responsibility' might be putting huge pressure on the Saudis to rein in prices and profits.

3.Political instability. The Bush regime has systematically alienated friend and foe alike. (To alienate a foe may seem an odd statement; but consider the legacy of Reagan, the Republicans' most revered figure of recent history, who managed to make a friend of the biggest foe of all.)

We are seen as arrogant, warmongering, nation-builders. We are seen as a nation of zealots. Our allies have deserted our cause in Iraq (remember Poland?) and we find ourselves shunned and reprimanded by millions upon millions of Muslims, who feel that our war is against their faith, and not against the Iraqi insurgents or the Taliban.

The Bushies have mismanaged foreign policy in a breathtaking fashion. Our relations with Russia are at the lowest ebb since the Cold War, we've antagonized Iran, bullied Venezuela and failed to support Nigeria. Interesting that those four countries are massive oil producers, isn't it? Creating instability in these areas leaves plenty of room for the Sauds to clean up on the back of restricted oil supply.

I'm not saying that those countries aren't antagonistic themselves – but with better management, our relations with them could have been significantly eased.

4. Money. Pure and simple. In the last six election cycles, the oil and gas lobby has contributed $119,477,000 to the Republican Party. In the same period, the Democrats have benefited by $31,428,000. That $80 million difference must have looked pretty darned good to the Republicans. The top 20 recipients of money from the oil and gas industry were all Republican. ... and this will surely have 'inspired' their domestic and foreign policies on oil.

In conclusion, the blanket statement that Bush is controlling oil prices is dismissed easily. But the underlying trends in the ever-spiraling price of gas can be traced definitively to Republican policy, and the extraordinary influence of the oil lobby and the Saudis on Bush and his chums.

Of course there are other factors. Not least a couple of wars, and Chinese growth. But these smaller, less obvious influences are inextricably intertwined with the Republican agenda.

Comments

[john counts]

Mr. Rice you have to be brain dead to think that one man controlls the price of oil.This is just another good example why the Liberal Democrats are America's biggest enemy.May God have mercy on your Soul!