Bush is to blame for the high price of oil/gasoline. Solid evidence.

I wrote about this a year ago and it is even more amazing to me now that oil is 98 dollars/barrel.  It is incredible that Bush refused to sign a contract with Venezuela for 50 dollars a barrel so that Venezuela could have long term financial stability in extracting heavy crude.  What would that have done for the price of gasoline right now?  I don’t know the numbers here, but I assume that a 50% discount on crude oil would translate to some serious savings at the pump.  Of course this didn’t make the headlines back then and people are still in the dark about this really, really bad move by Bush.  Check out the post from a year ago and see the link that gives the story.  Was this reported at all in the US press?


3 Responses to “Bush is to blame for the high price of oil/gasoline. Solid evidence.”

  1. 1 Non-Arab Arab November 8, 2007 at 2:45 am

    Ummm…this is really quite silly. Again, I’m with you in spirit, but I know oil markets and this is ridiculous. At best, a few lucky consumers would have gotten to wait in some very long lines (or given a voucher or something) that would have given them a little bit of cheap gas. More likely Citgo or some other refiner (probably Citgo) would have gotten cheap crude, a FAT refining margin, and then the product would have been sold into the market (we do have a free market here for oil products, trust me, I work with the traders every day) where it would have fetched a market price.

    Chavez has given away cheap heating oil in the Northeast several times now too. The consumers who got it, good for them, it helped some poor folks out. It didn’t do jack for the market price of heating oil on the NYMEX or at the pump.

    These are just silly theories, akin to the equally ridiculous email forwards “hey everyone, if we all refuse to buy at Exxon stations, we can drive the price down”. No you can’t, you’ll just drive it up at other stations to which you shift your demand and Exxon will re-sell their material to those stations and reap a tidy profit in the process.

    That said, is Bush to blame for high oil prices? In part, blowing up Iraq and taking hundreds of millions of barrels off the market, filling the Strategic Petroleum Reserve when prices are high (as most Presidents seem to do), and engaging in and supporting or threatening wars (Iraq, Lebanon, possibly Iran) which un-nerve investors and send them fleeing to “safe haven” investments like commodities and oil in particular — all those things have been huge in driving oil prices up and keeping them there. Of course there’s been many other factors – the surge in Chinese and other Asian oil demand, refining capacity tightness, and the jump in oil producer nations’ domestic oil demand (sort of a feedback loop there from the high oil prices they got in the first place thanks to Bush’s wars and China’s economic growth). Bush has definitely been a key piece, but far from the only one.

  2. 2 theradicalmormon November 8, 2007 at 5:14 am

    Thanks Arab,
    I appreciate your knowledgeable perspective. I didn’t put a lot of thought into this post. Bush’s great arrogance incenses me when I consider what he does. So, accepting a contract that fixed oil at 50$ a barrel would not have helped us that much at the pumps then?

  3. 3 Non-Arab Arab November 8, 2007 at 10:35 pm

    No. At best on on few people would get cheap fill ups, though just as likely the oil would have ended up getting kifed and sold at on on market rate, through either legal or illegal means. But for most of us it wouldn’t have made any difference. And what is for certain – for better or for worse – is that the Venezuelan state would have lost revenues.

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