Wednesday, June 08, 2011

Oil prices on the rise again, thanks to Iran, Libya and Venezuela

It might be hot outside today, but don't gas up that car for a summer vacation just yet.

Gas prices are about to go up again.

The world's financial markets are in a dither as OPEC ended what some have called its "worst meeting ever." Member nations apparently left the meeting without an agreement to increase oil production, which is already causing oil prices to spike.

CNBC has a story about the meeting on its Web site, which you can read here.

There are lots of things to say about this situation, not the least of which is the crushing effect that a further gas price spike would have on our economy this summer.

But what we want to highlight is the unsettling reality that, according to the CNBC report, the situation at OPEC was the direct result of seven member states who dissented: Libya, Algeria, Angola, Ecuador, Venezuela, Iraq and Iran.

Do we even need to mention that there are several terrorist states on this list of nations who directly control the price and availability of one of the most important natural resources in the American economy? NATO countries have been bombing Libya with airstrikes since March. Iran, which holds the OPEC presidency, is under sanctions for developing nuclear weapons. Venezuela is openly critical of the United States. And, then there's Iraq, where American sacrifice has been huge in recent years. Don't they at least kind of owe us one?

Yet, today, Mahmoud Ahmadinejad, Moamar Gaddafi, Hugo Chavez and others voted to make you pay more for gas this summer.

This is similar to the situation with the US national debt, a large amount of which is held by foreign countries. China alone has over a trillion dollars of US debt holdings (though it recently divested a large chunk of its short-term debt holdings, and has been shifting investment to Japanese long-term debt in recent days).

The sad truth is that much of the United States economy is subject to the control of foreign investors, many of whom are not exactly Uncle Sam's best friends. This isn't a new trend. And, it's not a Republican/Democrat problem. These are American problems, and they require American solutions. We need to reduce our dependence on foreign oil and trim our domestic spending/debt, so we can be more self-reliant. Fast.

Look, part of the reason why Donald Trump struck a nerve with the American public in his brief and ill-fated flirtation with the presidency is that he was plain-spoken in dealing with these issues. Check out this video. The players and positions at OPEC changed since Trump's speech, but his message was clear and on-point. When you think about it, why is Angola going to tell Americans how much we're going to pay at the gas pumps and how many jobs will be lost due to high gas prices in America this year? Donald Trump might not have been the guy, but don't we need someone to stand up for America at times like this?

So, what's President Obama's next move? What is his plan to get us out from under the thumb of foreign nations? What's the solution for gas prices? Much of the President's recent energy policy has been focused on US pricing, not on foreign countries seeking to impose high prices on us. And, what's the deal going to be on the debt ceiling? The President's recent announcement was to invite Speaker Boehner out for golf. We need bigger action in Washington to solve these problems.


  1. Do you mean this from 2008?

    Or how about this from 2011?

    That should point you in the right direction. Not sure what else Obama should do other than point a gun at these counties.

    We could have had a head start when gas prices soared under Bush in '07. Or when he hatched his secret plan in 2000. Or under Clinton. Or Bush I. Or Reagan. Or if Jimmy Carter's comprehensive plan were adopted. Plenty of plans, lots of blame.

  2. The question isn't one of blame. The issue is that Obama is President now, so like it or not, it falls on him to do something about this situation, which has deep geopolitical roots beyond normal questions of economics. Or, we could always just wait for the next guy to clean things up. Either way, something's gotta give.

  3. But it is about blame. You imply that he hasn't prepared the country for this crisis and you want to know what his plan is. I said he has talked about energy independence and increased drilling at different points in his presidency.

    That said, this is a major policy let down for which Democrats and Republicans share blame. It's not as though this is a surprise. Unfortunately, they both can't take the blame at the ballot box.

  4. Here's the deal, plain and simple.

    Gas is about four bucks a gallon and getting more expensive by the day. Unemployment is over nine percent. There are 13.9 million people out of work nationwide right now; that's greater than the populations of Illinois or Pennsylvania, and twice as many people who live in Massachusetts. Recent reports peg each household's share of unfunded government obligations (debt, retirement plans, retiree health care) at more than $500,000 per household, with a national debt over $14 trillion and encroaching on 100% of GDP.

    This is a national crisis and it needs to be fixed, right now. And, if President Obama can't or won't contribute to solutions as the current occupant of the White House, whether or not he caused or contributed to the problems, then he should be replaced by someone who will fix things.

  5. Just push the Easy Button and you will feel better.

    You two are hilarious.. "it needs to be fixed, right now." good luck.. things take time, nobody could fix this right now. Get a grip. Sensible green energy/nuclear energy/drilling wouldn't fix this problem right now. We need to begin finding replacements but Obama will be long out of office before we are out from under the thumb of foreign nations. Instead of hyping his Hydrogen Cars scam, a technology he knew wouldn't effect oil company profits during his presidency Mr. Bush did nothing.. where is your post blaming his inaction for the current crisis. But yes we could have even started back in the 80's so plenty of blame to go around. Point is if Obama doesn't fix this "right now" you will be blaming him come election time for something he has very little control over.

    Now where you really go off the deep end is your "Several terrorist states" comment. Is this the George Bush way of talking where if you don't agree with The United States you are suddenly a terrorist. And "doesn't Iraq owe us one?" Are you kidding? We have killed Over 100,000 Iraqi Civilians by illegally waging war against them. This is one of the most insulting, insensitive and pigheaded things I have ever read on your blog and you should be ashamed for it. You pretend to not make this a political post but just can't take your right wing blinders off.

  6. Actually, gas prices here and nationally are on the decline. They're also declining by the barrel. The fear is they'll go back up and make consumer prices go up. That's what was stalling the economy.

    (I'm not biting on your debt apples and oranges. Sorry.)

    Look, try reading my links before launching into partisan talking points. I post facts. Republican presidents drill. Democrats talk. So far, we're still sensitive to price fluctuations of international oil markets. We'll always be so long as we import 51 percent of our oil Obama proposed a raft of things to make us independent of oil. He's got T. Boone Picken's ear on natural gas. We'll see how his plans work.

    Meantime, I look forward to your white paper for energy independence. Or better yet, post the Republican candidate's you endorse.


By submitting a comment, you agree to be bound by our policies on comments noted in the sidebar.