Bush and Cheney are same as Enron CEO ...
Rob people money for their own profit ..

Thanks to you all for the above discourse in response to my request for contributions to the learning curve on the mysteries of the petroleum futures market.

Despite this input, I still fail to see any social utility whatsoever - for the United States as a nation, or for mankind generally - in petpetuating a system that encourages billions and billions of dollars, euros, or yuan to be gambled endlessly, speculating that months or even years from now the price of oil will go up rather than down. To me, maintaining such a system is far more harmful to the overall economy or lives of real working people than, say, gambling on the point spread in next weekend's sporting events.

Anyway, my bottom line on Scheer's proposition comes out like this: the price hike at my pump is 80% Bush's fault, half due to the deregulation of speculators and big oil, and the other half due to his fiscal folly's impact on the value of my dollar.

Bill from Saginaw

"about 3.5% of US consumption. Sounds about right?"

Nope, watch the decimal point.

"that's 317331 million gallons a year. "

Or 317.331 billion, so the percentage is actually .35%, I was over by a factor of ten.

From EIA, US consumption:

"Total petroleum consumption of liquid fuels and other petroleum products averaged 20.7 million bbl/d in 2007"

That's *barrels*. So in a year it's 7555.5 million barrels a year. 42 gallons per barrel, that's 317331 million gallons a year.

So military consumption in Iraq is about 3.5% of US consumption. Sounds about right?

"one thing I am sure of is that there are a lot of pieces."

Yup.

"In 2007 alone, the U.S. military in Iraq burned more than 1.1 billion gallons of fuel. "

It would be much more meaningful to compare this figure as a percentage of total world consumption that year, anyone?

also from the same March 2008 article;
[the need for] ....mine-resistant ambush protection vehicles or MRAPs.....

The MRAPs mean even greater demand for fuel from U.S. troops in Iraq. An armored Humvee covers perhaps 8 miles per gallon of fuel. One version of the MRAP, the Maxxpro, weighs about 40,000 pounds, and according to a source within the military, gets just 3 miles per gallon.
While the U.S. military chases its own fuel tail in Iraq....the global energy industry is racing forward with new alliances and deals, many of which would have been unthinkable before the invasion. Those alliances have far-reaching significance for America's foreign and energy policy. The world's oil market is no longer shaped by U.S. military power. Markets are trumping militarism.
This change cannot be stopped or ignored. In today's multi-polar world, economic interests, not military force, predominate. "It used to be that the side with the most guns would win," says G.I. Wilson, a recently retired Marine Corps colonel, who has written extensively on terrorism and asymmetric warfare and spent 15 months fighting in Iraq. Today, says Wilson, the side "with the most guns goes bankrupt."

Here is another piece of the oil price puzzle....and one thing I am sure of is that there are a lot of pieces.
(this was an excellent article by the way)

from; http://www.amconmag.com/2008/2008_03_10/cover.html
[our military uses]over 3 million gallons per day for Operation Iraqi Freedom, according to the Pentagon's Defense Energy Support Center....nearly every drop of that fuel is imported into Iraq.
In 2007 alone, the U.S. military in Iraq burned more than 1.1 billion gallons of fuel. (American Armed Forces generally use a blend of jet fuel known as JP-8 to propel both aircraft and automobiles.) About 5,500 tanker trucks are involved in the Iraqi fuel-hauling effort.

"NEW YORK (Reuters) - Exxon Mobil Corp (XOM.N) said on Thursday it is getting out of the retail gas business in the United States as sky-high crude oil prices squeeze margins."

Who will buy EXXON's Toxic Waste Pumps?

Scheer: you and all other armchair oil-amateurs who believe that Saudi Arabia is still sitting on an infinite ocean of gas-propelled oil need to read "Twilight in the Desert" by the oil-expert Matthew R. Simmons who predicted in 2005 that the day would come soon when ARAMCO could not again keep the price of crude from rising out of the pan as it had done in the past because ARAMCO can no longer safely increase its oil production by much without seriously reducing the gas pressure of its super-fields. Every known super-field such as for example Brent in the North Sea (and every smaller field)has gone through peak-production and declined. I am not a friend of OPEC but calling them liars on peak oil is contradicted by known facts.
One of the other major factors of the rise in crude price is the weakening dollar (sorry jakentown; it is so). The most effective and possibly only way in which our next president can reduce the price of crude and thereby the cost of gas at the pump is by substantially reducing the government's budget deficit to something close to zero. There are, in my opinion, only two socially acceptable ways of doing that. Reduce the military budget by at least 30% (hence get out of Iraq, Afghanistan, Japan, Korea, and Europe as fast as possible and dismantle much of the military/industrial/Congressional complex) and/or a permanent increase in taxes but not the inheritance tax (a stupid measure at a time when property values drop and the stock market remains constant). Neither McCain nor Obama seem to understand this. They are like the blind leading the blind. Blaming Bush for the oil crisis is good fun but is close to useless demagoguery. Leadership must now come from one of the two candidates or, even better, both. Do not hold your breath. Both are politically what in the sport of boxing is known as flyweights.

"The falling American Dollar is to blame,"

Only in part. In Euros oil is upo 80% or so compared to 100% in dollars over the last year.

The falling American Dollar is to blame, the fact barrel prices are priced in 'dollars', and the speculation in the stock market as hedge funds are buying up oil, driving up prices and stock piling OIL because the Dollar isn't worth SHIT anymore. That is why RICE is going up and other commodities...there is no shortage on OIL. The only reason Congress, YES Republican Congress people are using the shortage of OIL Scam is they represent OIL companies, and are being paid by them to support drilling in Alaska and off the coast again. They want to milk more money, destroy our environment and drive us to SUPPORT DRILLING!! don't be stupid..it is MORE LIES..just like over exaggerated prices at the pump to FORCE OUR HAND TO LET THEM DRILL. Politicans LIE TO THE AMERICAN PEOPLE as they no longer represent us. They represent the RICH oil companies and do their bidding like puppets and ventriloquist dolls..They are pawns..and always have been.. BOUGHT! That is why the voted against TAXING OIL COMPANIES as they care only for them and NOT YOU. There is no shortage of OIL..it is the raping of America to get what they want..GREED, MONEY THE RICH Want it ALL!

"The oil companies will push up the prices until October maybe to 8$, then John McCain will do something in collusion with the oil corporations to bring price down 2$ or so to get elected promising more reductions once elected…"

You whack jobs said the same thing in 2006 and the Republicans lost both houses. Wise up.

The oil companies will push up the prices until October maybe to 8$, then John McCain will do something in collusion with the oil corporations to bring price down 2$ or so to get elected promising more reductions once elected...once elected he will allow prices to go back up to 10$ or 12$, that's the price the oil corps think they can push it before people stop driving altogether...so they will and they're right Americans will pay 12$ if they have to. As for drilling in Alaska the oil companies don't want to do it for less than 8$/gallon its too expensive, not worth it, its not the environmentalists stopping the drilling, they don't have the power, with Bush and a Republican congress (half the so called Democrats are Republicans) , it's the oil companies that need to push the price up first, and if McCain is elected we'll be drilling in Anwar and you'll be paying 8$-12$ plus for gas forever so we can drill in Alaska...I won't cause I ride a bicycle...

Thanks to all the people explaining how commmodity future's trading works.

Sorry people, but Bush's only role in high oil prices is the perfectly rational market effect of his saber rattling (and actual saber use), but this is perhaps 20 percent of price increases. The rest is simply supply and demand and the approach of world peak oil production.

Sheer's remark about "green zealots" was offensive. It is imperitive, both environmentally and economically that we deeply cut fossil fuel use. As a socialist, I'm quite skeptical of unregulated markets in addressing human needs. But in the case of oil, the markets are doing a splended job right now.

If you don't like high oil prices, remember the law of supply and demand? Well, reduce demand! Stop driving your car; move or change jobs if you have to so you can live close in to your job and shopping and use public transit. This is the only way I've ever lived since becoming concerned about global warming in the early 1990's. But along the way, you'll find that not being enslaved to a car is a big improvement in your quality of life too.

"The following link argues that the global money supply of "fiat" currencies has everything to do with the price of oil."

*All* currencies in the world are fiat.

The following link argues that the global money supply of "fiat" currencies has everything to do with the price of oil. http://www.financialsense.com/Market/wrapup.htm

Americans are to blame, not Bush, they have chosen him twice knowing fully well he and his VP were oil men. As a result, the price of gas today is being manipulated from right inside the Oval Office for maximum profit. I just wished Americans were paying $9 a gallon, like the rest of the world. They will, after Bush and Cheney attack Iran and cancel the elections. At least the environment will benefit, even if a tiny little bit, from less green gases being dumped into the atmosphere.

Bush is merely a reflection of the American people. They've created the monster, they should pay for his atrocities.

My point is that we ignore the underlying suppy fundamentals in regards to oil at our peril.

It would seem obvious that current government policies such as the War of Aggression (and the more costly, in blood and treasure, Illegal Occupation) and the deregulation of markets has exacerbated the underlying problem.

But it is open for Debate whether Bush's crimes are more resposible for our Society's "un-preparedness" than the failure of government over the last 35 years since peak U.S. production -involving many parties, Executive, Legislative, Democratic and Republican, even Scientific, Intellectual, and Influential- to respond to the new Situation and lead the People in reorganization.

My concern is that I believe that an excessive number of the more "awake" People in this country are over-focusing on (or being channeled to) a purely political view of the Situation.

This is worrisome for two reasons:

1)The most available Electoral Choice, the Democrats and their Candidate, Obama, are not only NOT moving significantly toward the Needed Changes, but are actually complicit in most of the previous mistakes.

2)The Situation before us requires that we aquire many new Skills, this will necessarily take a large portion of our Time and Effort, and therefore we would do well to not be distracted.

To me, it is akin to the Global Climate Change situation. While it is important and useful to know whether or not our Industrial production and lifestyle are the cause, or that perhaps some conversion of natural forces is truly behind it, the important thing is that we understand as much about its effects as we can and then Adapt our Society to maximize our potential benefit (even if that must be quite meagre by our current material standards).

This seems to be the situation with the Fossil Energy price crisis as well. The point is not that without Bush's War, or rampant unregulated speculation and profit, the price of a gallon of gasoline might be $3.79 and 9/10ths instead of $4.42 and 9/10ths.

The point isn't even that World Liquids production is peaking, or that the producer Nation-States are now holding more back for themselves, or that all of this should have been easily forseeable 35 years ago and we should have spent the intervening period adjusting.

The point, the big Point that I sense a lot of the People are missing, is that whatever has occurred in the Past, what matters NOW, is that we belatedly realize our actual Situation and begin to Adjust.

Whether it is "too little too late" or not.

It is the only rational and sensible response.

Bush acted -and still acts- as though he were a Tyrant. The acts he has commited as "president" have brought our Constitutional System over the edge of Trouble into true Crisis.

This is all true, and requires the energy of some of us (or some of our Time and Effort) to address, or at least take account of and protest against.

But the rest of us (or the rest of our Time and Effort) need to be focused on the Bigger Picture, the one that includes the down-to-earth realities of preserving (perhaps bettering?) a democratic and peaceful Society, despite the tribulations of the Adjustment of our lifestyles in the face of Fossil Energy scarcity and depletion.

Politicalizing -as this article does- the Energy crisis can, in my opinion, only serve to divide and distract the People.

We should avoid this, not encourage it.

-matti.

oh, in reference to the article, blame the rapid jump in prices not on regular 'suppy and demand' but rather corrupt profiteers that fly country to country avoiding any semblance of responiblity to their fellow man. Call the Corporate Capitalists. Or the new elites, aka Globalists.

When speculators are given the go ahead to manipulate markets, what do people expect?

off topic, but not really, what ever happened to INDUSTRIAL HEMP FOR OUR ENERGY NEEDS? google Hemp For Victory.
the truth is out there.

blah, blah, blame it on the stupid americans that voted for bush. Oh wait, he didnt even win the election! well then, blame it on the nefarious Supreme Court judges/lets see here...

Five justices agreed that December 12 (the date of the decision) was the deadline Florida had established for recounts (Kennedy, O'Connor, Rehnquist,[26] Scalia and Thomas in support; Breyer,[27] Ginsburg, Souter[28] and Stevens opposed). Justices Breyer and Souter wanted to remand the case back to the Florida Supreme Court to permit that court to establish uniform standards of what constituted a legal vote and then manually recount all ballots using those standards.

ahhhh the infamous verdict, thank god those original Breyer,[27] Ginsburg, Souter[28] and Stevens, haven't left the bench since bush took office. F(#k O'Connor, i always kmwn she swasy workthless.

Impeach!!!
didnt a democrat president get impeached for as little as getting a head job during the 90s? And the current prez walks around trying to make deals with european leaders during the waning months of his presidency? Where did i miss something?

Scheer: "Bush's deliberate roiling of world politics is the key variable in the run-up of oil prices. "

I think Scheer is GOD, but would like to point out the role America's DEBT plays in oil prices. Under Bush, America has DOUBLED her national debt, and DOUBLED her private (i.e. household debt). This $20 trillion in added debt has a role to play in our current oil prices.

Remember: when Bush became President the U.S. dollar was still the defacto GOLD STANDARD in the WORLD's currencies!!! International financiers were already worried about America's ability to pay her many debts when Bush became President (remember that, at that time, the Baby Boomers were a mere 10 years from retirement: and a major taxing of our SocSec/Medicare system).

Enter Bush: and a MAJOR TAX CUT!!! International finance could see what ordinary Americans could NOT: our debt was about to DOUBLE!!!

And double it did. Well, what do you do, if you see (presciently) that America is on the verge of NOT meeting her debt obligations!! You dump dollars!!! Hence, a 50% decrease in the dollars value over the last 6 years. Many oil analyists blame this dollar dumping as the PRIMARY reason for the increase in oils value recently. OIL is now the defacto world CURRENCY, now that the dollar has proven itself UNWORTHY of that title.

Bottom line. 7 years after Bush became Prez, people who earn their currency in dollars (i.e. working Americans), are increasingly WORTHLESS to the world community. The investment dollar has become the investment euro/oil barrel/yuan/etc., ANYTHING but dollar's!!!

The rich divest themselves of dollars in this new international investment community. The poor working-class Americans, who have no choice but to earn DOLLARS: THEY are the world's next third world citizens. Increasingly forced to the margins of this global economy. And THAT is why ordinary working-class American's have had such a 'wake-up' call at their neighborhood gas-pump this Spring.

Would like to blame Bush for oil prices, but that would necessitate hearings by congress. They did that before but nothing happened, it seems Pelosi took impeachment off the table.

I just finished reading Naomi Klein's "The Shock Doctrine." I recommend it. It occurs to me that this oil crisis, in which prices are rising at an extraordinary and unexplainable rate, seems to fit nicely under the shock doctrine theory in Ms. Klein's book. Bush has been trying to drill for oil in ANWR and the Florida coast for seven years. Even with a Republican majority he couldn't do it. With the likely election of a democrat in November, the oil companies will be out of luck (maybe). How convenient that the public is being traumatized by high oil prices. If we get frightened and panicked enough (and Americans are easily frightened), we'll agree to anything. Perhaps this crisis is nothing more than Bush and big oil's last ditch attempt to plunder the Alaskan & Florida environments.

My vote for Obama's Sec. of Defense -- Robert Gates.

We knew this, Robert. Wait till after Obama is elected. The dark forces will have us paying $10.00/gal by 2010. But thanks; I'll read it now.

http://www.financialsense.com/editorials/engdahl/2008/0502.html

In a nutshell, he suggests that the Bush Administration dropped the ball in January 2006, when they allowed totally unregulated electronic trading of oil futures contracts in New York. Previously these electronic trades had been made at the London Intercontinental Exchange (ICE) Futures Market. With that decision by the Bush Administration, all of the world's oil prices were then opened to upward pressure from speculative futures contracts. In essence, oil futures contracts made by speculators, banks, hedge funds and pension funds all competed with real demand on the spot markets and had the effect of driving up both wholesale oil prices and retail gasoline prices. Speculators have made billions of dollars on their trading of oil futures contracts. All of their profits come right out of our pockets.

Even with a stable oil supply, there is a slow worldwide increase in demand for oil, which creates a long-term upward pressure on oil prices. However, with the relentless saber-rattling and war-mongering by Bush and Cheney in the last several years, and the more recent war talks by McCain and the Israelis, the oil futures markets are rife with speculation and paranoia. This war talk keeps ratcheting up the prices on the oil futures contracts and hence the wholesale spot market prices. It is an endless spiral of greed and paranoia.

As long as there is no tough and effective oversight of the electronic oil futures markets by the Bush Administration, the oil prices will climb endlessly. These oil prices will be quickly followed by hikes in the retail gasoline prices at the pump.

"Detention camps are being built as we speak."

Total BS.

At least the violent depopulation agenda has one. We either depopulate voluntarily and humanely, or nature will due it for us with war, crime, famine, disease and other painful and violent means. Not man apart.

Yes but Gates doesn't know the whole picture, only his little compartmentalized piece. That is the way the global elite work. People serve them without even knowing it because others and doing the same. Only the elite and a select few know how to assemble the work of the ignorant into their plan for global enslavement. We are not building the military for foreign threats. We are building the military to use against our own people and people abroad. Detention camps are being built as we speak. Raytheon just completed a directed energy weapon to disperse crowds. One in ten are on antidepressants that don't work. Chemtrails are everywhere. Fluorinated water numbs us to the reality. AIDS and other cancer causing viruses are running amok. America has been duped. Whites never thought other whites would turn on them but the elite were never on the side of Caucasians anyway. They are own their side and their side only. The depopulation agenda has been going on for centuries and is beginning to reach peak efficacy. Wake up or die.

"Oil was at 60 dollars last June. Today it is 136 dollars. WTF did Iraq have to do with the oil price increases over the last year when it's oil production has increased over the past year to it's pre-war levels."

It's the answer I am looking for too, and would expand the question to "what Bush/Cheney have done in general in the last year as well.

I would most likely believe what a pit trader would say about the causes of oil prices over anyone else.

jesusofjonesboro June 11th, 2008 9:12 pm

"Some posters in this thread are giving themselves hernias trying to lay off the blame for our current mess on the Democrats based on the rather childish reasoning that many of the Dems wound up voting for Bush's proposals."

Well, actually, that does make them partially responsible. There's nothing childish about holding people responsible for their actions in the real world, rather than giving them a free pass based on speculations about their behavior in a hypothetical world.

Many Democrats supported the Iraq War and opposed increasing CAFE standards until last year. These actions helped to make the problem worse.

However, the majority of the problem is due to rising demand for oil in China and other developing countries. Yelling at Bush won't chnage that one bit.

Some posters in this thread are giving themselves hernias trying to lay off the blame for our current mess on the Democrats based on the rather childish reasoning that many of the Dems wound up voting for Bush's proposals.

While the Dems can justifiably be accused of gutlessness, the blame for the current issues facing the US can be assigned by answering two embarrassingly simple questions.

Would the US be in the mess that it's in WITHOUT the Democrats? The answer is "yes" because the groundwork for almost all of our current roster of disasters was developed by republicans.

Would the US be in the same mess WITHOUT the republicans? The answer is 'no" (same explanation).

The blame for the financial, energy, healthcare, and food crises belongs in the lap of the GOP.

End of discussion.

jj

No, Samson, the mistakes that Democrats have made simply don't exonerate Bush or mitigate his deeds in any way. He is a goose. Say it.
GOOSE! Or would you prefer "popinjay?" Or
"murderer?" He's a pompous twit, too, always worried about his "legacy." He is getting exactly what he deserves.

One can view his presidency as tragedy or comedy, I suppose. (Only tragedy implies
tragic stature in a man who is beneath pathetic.) In any case the villain gets his just reward.

I don't think you or anyone should cop out on this view.

Braithwa842--Very close, except you don't buy futures from Exxon, you buy them at one of the global futures markets. In fact, after reading it all, BRAVO!!!!

Hi Bill, Samson above does an okay job of explaining a bit about futures, especially the part about where the contract settlement price is different in the spot market than that set in the contract. For individuals and companies using for production or selling the actual commodity, the future contract represents a hedge, a guarantee of the price at delivery. If I grow corn and I need a particular price to met my margins and make a profit, then I will purchase the sell side of a futures contract that gives me that price, if available, or the one the closest to it at the time I expect to harvest. The same is true for the buyer; for example, Southwest Airlines wants to buy its jet fuel at the lowest possible price, so it enters into futures contracts to provide it with a known cost for its future fuel needs (in this they were very astute about the future rise in fuel cost and established very good hedges which are at much lower delivery prices than now and on the spot market). In both examples, the seller must physically deliver the contract amount and the buyer must accept physical delivery of the fuel. Neither buys or sells, respectively, their futures. The contracts merely expire upon delivery and the monies traded. Futures must have a buyer and seller as no distinction is made between the speculator and the seller or buyer making/taking actual delivery; this is why spikes up or down are often seen toward the expiration of the contract. A speculator can enter into a short or long position, but it must be balanced by another actor on the opposite side of the trade. Commodities cannot be just sold short or naked shorted, unlike stocks. So, there are speculators in the futures market, but the effect is nil over the course of the contract. Short term it is possible for many to buy long or sell short; but this is balanced by the signal it sends. For example, many contracts are bought driving up the price because there aren't enough sellers present. Sellers then enter to take advantage of the higher price they can get. But for those unable to take delivery, they must sell, or if they cannot provide delivery, they must buy, which alters the price in a volitile manner.

So why have oil futures risen? If there isn't enough supply to deliver to the buyers, then the buyers will bid against each other. That is what happens in the trading pits and drives up the spot price. Remember, this is a capitalist game and an old adgade applies: Charge whatever the market will bear. This is why Chavez's offer to sell oil and heating oil at below market prices to poor countries and impoverished peoples in the USA was met with scorn as it puts everyone else in a bad light.

As available supply dwindles, importers will bid the price up, as at an auction. This sets the spot price and in turn effects the futures price. Not to long ago, just a few weeks, oil futures were in Backwardation, which means the price went lower than the spot price the farther one went out in time. So one could get a very good hedge if they bought a contract for March 2012 at $100/bbl while expecting the spot price at the settlement date to be much higher than current spot price. This has now changed into a condition called Contango, where all forward futures prices are higher than the current spot price. This is a signal that supply is expected to be less, or demand to be more, in the future.

There are several benchmark crudes used as markers on the various world exchanges. What you see on the NYMEX is WTI, West Texas Intermediate, which is delivered at Cushing, Oklahoma. Recently, Louisiana Sweet has sold at a premium to WTI. TAPIS in Singapore has traded close to $150 recently. Considering oil's energy equivalent in human labor, gives us a figure of about 1/2 million/bbl, based on current minimum wage. So oil is relatively underpriced relative to what it provides, which is also why the US economy is so addicted to it. Cheap oil=Cheap labor. All the above and much more is explained and discussed at theoildrum.com. And the very important ASPO-USA Conference for 2008 will be in Sacramento, CA September 21-23. I'll be there, and you all should too if you're concerned about this vital issue and want to learn more and network with those of us trying to do something about it.

http://www.minimovie.com/film-128295-Welcome%20Back,%20Clinton

@william street June 11th, 2008 6:37 pm
@karlof1
@andersdl

Let us say I contract to buy a million dollars worth of crude oil in six months time from say, Exxon. In six months time, I must then sell this same oil at the market price. I can only get what the highest bidder bids. And regardless of whether exxon are selling it or I am selling it I am still not going to get better than market price, which is determined by a market that is essentially an auction.

Exxon will have gotten an assured price that they can count on regardless of the market. Myself, I may well have made a profit (or a loss). But my transaction will not have changed the total number of barrels of that are for sale, and so my transaction will have made no net effect on the price of the oil. Given that the supply is now fixed, the price is totally determined by how much the refiners are willing to bid for it, and ultimately by how much we are willing to pay for it at the pump.

I dont think that speculation alone can alter the price of oil at the market. In order to alter the price of oil, you would have to change the amount of oil flow that is available. You could do this by storing the oil, but this would only work in the very short term. In order to have a real impact over any long term, you would have to be able to change the the flow rate of extraction of crude (i.e. light sweet is the one where the shortage is). I believe that light sweet crude has peaked and the rate of extraction of light sweet crude cannot be increased.

I am aware that Iraqi oil production has been damaged by mismanagement (the Iraq sanctions) and also by attacks on oil production by the Iraqi resistance. Under production or overproduction of an oil well is known to hamper and damage the easy extraction of light sweet crude. So that will have had an effect. I could not guess the magnitude of that effect, however. It may have raised the price of crude by $10 or by $0.10 .

MiMiCcS, If not for the invasion of Iraq oil probably would have been $20 a barrel last June so I will tell your WTF Iraq has to do with higher oil prices. 1.) throwing the whole of the ME into chaos makes oil prices higher because of fear, fear of war with Iran, fear of tying up the straits of Hormuz, fear of Civil war in Iraq, and so on 2.) I don't know where you get your info but the last time I looked Iraq's oil production is nowhere near pre-war levels. 3.)And of course had Bush's plan for Iraq worked out we wouldn't be having this exchange as no one would be worried about oil prices - YET - peak oil would still be an academic notion like it was at the beginning of the war in Iraq

Oil was at 60 dollars last June. Today it is 136 dollars. WTF did Iraq have to do with the oil price increases over the last year when it's oil production has increased over the past year to it's pre-war levels.

Yes, Bush is responsible for the surge in oil prices in that he blatantly attacked Iraq to gain control of the pond of oil it sets on. Did he do it to destabilize the ME? No, to the contrary Bush thought that it would place a "democracy" (that would kiss the feet of the U.S.)in place, secure Israel, and take away Saudi Arabia's trump card. His administration knew about peak oil so it seemed logical to control Iraq's oil and keep cheap oil coming to the US. The problem is that he and his advisers knew nothing of the ME (Bush probably didn't know a Shiite from a Sunni or an Arab from a Persian and I would be surprised if he could have found the ME on a world map before the invasion)and had no idea that it would be so offensive to have thousands of Christians soldiers, totally ignorant of Arab customs, occupying their Country or that the occupation would unleash a civil war. They had no idea that the Shiite were more closely tied to Iran and fanatical Islam than the Sunni who they thought was synonymous with the Ba'ath Party so they cast their political lot with the Shiite just because they were supressed by Saddam so should be ever grateful to the U.S. Liberators.
Yes, Bush did cause the immediate oil crises but I don't believer it was his intention-that's giving him too much credit.

One thing to keep in mind is that the price of 'futures' in oil is not directly tied to the actual price of oil.

For instance, people could be buying 'futures' for the price of oil six months from now. What they've really done is committed to buy oil at that price on that date. There's no guarantee at all that this will really be the price of oil at that time. The situation in the world could change drastically in some way, and the price of oil could be much lower then. These people with the futures would then be committed to buying it at a higher price than the actual market price on that date and thus lose on their gamble. On the other hand if oil went up more than expected in the interval, these people with futures would win because then they'd be holding a contract to buy the oil at less than the actual market price. They'd actually buy the oil, or sell the contract to someone who did actually want the oil, then they'd be getting oil at less than the market price.

So, don't confuse too much the 'futures' price of oil with the actual price of oil. The futures price does represent everyones best guess as to what oil will be worth in the future. But it does not actually set the actual price at that time. That's another market.

Now, what would affect the actual price would be if say some big oil companies were over-buying oil today to stockpile it against future days when they expect it to be worth more. That would affect the actual price of oil.

Let me expand on this, because it is rather central and common to Democratic policies. Typically, they've let Bush do pretty much anything he wanted to do. For instance, I can think of few if any Senate filibusters to try to block Bush policies or Bush appointments. Instead, the Dems will make a few mealy-mouthed statements that kinda-sorta oppose the policy, then they don't do anything to oppose it. Often they deliberately refuse to take actions like filibusters or controlling the funding or even impeachment that are the Constitutional tools a party in Congress has to actually oppose a policy.

Instead, the Democrats seem quite happy to let the awful policies happen because they think they'll have an 'issue' to use in the next campaign.

For me, that's a rather disgusting notion. The idea that the Democrats will let policies and appointments that will harm the nation take effect just to have an issue in the next election is awful. They are deliberately saying that their lust for power is more important than what's good for the nation.

That's why I roll my eyes now when they want to blame this all on Bush. The Democrats had chances to stop or contain these policies, and they have not done so. Now they want to point the finger and say its all Bush's fault.

Bill from Saginaw,

If you look at the history of speculation in this country, you will find the present quagmire is no surprise, and answer much of your own question. After marginalizing indigenous peoples and stealing their land, this country was built on speculation. Land speculators helped the railroads make a killing. The 1870s and 80s were rife with exploitation, corruption, and greed, demarcating the beginning of the Gilded Age. Some historians argue we have entered a second Gilded Age. I argue we never left the first one. But, you raise a good question.

"that the five fold increase in gas prices since Bush took office is directly, causally linked to sabre rattling and the petroleum consumption demands of maintaining a huge US military presence on war footing in the Middle East."

I basically agree with this, except for the part where its blamed on Bush only. The Democrats have been completely on board and supportive of this policy all along. They voted to authorize both wars, they've voted to fund both wars, they've voted for ever increasing pentagon budgets, they've been very supportive of expanding the war to Iran, the Presidential candidates were trying to out-do each other in who could be more belligerent about extending it to Pakistan, just recently Obama pledged full fealty to Israel that the congressional Democrats have regularly passed resolutions saying the same.

So, I just think its a bit disingenuous to at this point try to blame Bush for policies that the Democrats have never tried to effectively oppose.

karlof1 & andersdl -

By all means, help my learning curve.

What social utility is there in having an oil futures (or a water futures) commodity market in the first place? It seems to me these guys are nothing but day trading, paper shuffling parasites, who gamble that they can make a fast turn around buck off of other people's misfortune and other people's paranoia. I doubt if any one of them have ever actually wrapped their arms around a real barrel of sweet crude any more than they've ever fondled an actual pork belly.

What would happen if the government simply outlawed commodity futures trading (ie., speculating) in petroleum? What if each profit taking transaction were taxed at a 50% or even a 90% rate to generate a revenue flow directly into the federal treasury, rather than fiddling with the tax structure on retail gallons purchased at the pump?

I sense Sheer is basically correct, that the five fold increase in gas prices since Bush took office is directly, causally linked to sabre rattling and the petroleum consumption demands of maintaining a huge US military presence on war footing in the Middle East.

Sure, peak oil and the need for conservation and alternative energy is the long term task. But short term, the insider commodity speculators and the big oil companies keep on laughing all the way to the bank every time Bush, Olmert, or any of the other major politico crazies so much as hiccup about escalating war and roiling up still more strife and disruption anywhere near the Persian Gulf.

So why should there even be a market that makes it legitimate to place bets and make a buck (or a billion bucks) gambling on greed or Armageddon?

Bill from Saginaw

Corporations have no business running our country, unless its run by We the People Inc.

The Democrats want to blame everything on Bush. This a part of their election strategy. Everything is Bush's fault. Then its also going to be McCain's fault. Follow this simple line of argument and it leads to the mirage that if you just vote Democrat then everything will be better.

So, what this article doesn't mention.

-- Peak oil and the effect the topping off of oil supply availability has on markets.
-- Increasing Demand from developing countries like India and China.
-- Neither Democrats nor Republicans talk seriously about reducing US demand.
-- To the extend the wars in the middle east have helped raise oil prices, the Democrats are as equally responsible for those wars.

I always like Robert Scheer - always a rare voice of sanity in the madness that has been Iraq. But why the sneering aside "abetted by some green zealots"? Why is an eminently sane man like Scheer falling for the neoconservative frame about environmentalists? He doesn't fall for frames on foreign policy, so why this? Some explanation here http://www.blognow.com.au/mrpickwick/40377/On_the_side_of_angels.html, and I look forward to a mea culpa from Mr Scheer. We are in enough trouble on this lonely planet without the good guys getting it wrong.

Bush told us that America has an addiction to oil. Duh! What and where is the energy policy hammered out in secret between Chenny and the energy execs? Americans are energy hogs. We need some kind of national energy policy. In that sense, Bush/Cheney are responsible for this mess.
Read Greg Palast's ARMED MADHOUSE. He explained the whole thing.
Thanks JConrad for a great read.

A very good read:

www.globalresearch.ca/index.php?context=va&aid=9191

excerpt:

" This upheaval in the global economy is deliberate. The State's economic and financial policies are controlled by private corporate interests. Speculative trade is not the object of regulatory policies. The economic depression contributes to wealth formation, to enhancing the power of a handful of global corporations.

According to William Engdahl;

"... At least 60% of the 128 per barrel price of crude oil comes from unregulated futures speculation by hedge funds, banks and financial groups using the London ICE Futures and New York NYMEX futures exchanges and uncontrolled inter-bank or Over-The-Counter trading to avoid scrutiny. US margin rules of the government's Commodity Futures Trading Commission allow speculators to buy a crude oil futures contract on the Nymex, by having to pay only 6% of the value of the contract. At today's price of $128 per barrel, that means a futures trader only has to put up about $8 for every barrel. He borrows the other $120. This extreme 'leverage' of 16 to 1 helps drive prices to wildly unrealistic levels and offset bank losses in sub-prime and other disasters at the expense of the overall population. (See More on the real reason behind high oil prices, Global Research, May 2008)

Among the main players in the speculative market for crude oil are Goldman Sachs, Morgan Stanley, British Petroleum (BP), the French banking conglomerate Société Générale, Bank of America, the largest Bank in the US, and Switzerland's Mercuria. (See Miguel Angel Blanco, La Clave, Madrid, June 2008)

British Petroleum controls the London based International Petroleum Exchange (IPE), which is one of the world's largest energy futures and options exchanges. Among IPE's major shareholders are Goldman Sachs and Morgan Stanley.

According to Der Spiegel, Morgan Stanley is one of the main institutional actors in the London based speculative oil market (IPE). According to Le Monde, France's Société Générale together with Bank of America and Deutsche Bank have been involved in spreading rumors with a view to pushing up the price of crude oil. (See Miguel Angel Blanco, La Clave, Madrid, June 2008)"

And then there is the deliberate debasement of the dollar by the Federal Reserve to cover war spending and a weak economy. Oil is traded in dollars that have fallen dramatically against other major currencies such as the Euro.

This is all nothing more than a transfer of wealth from the many to the few via war crimes and market manipulations !

Etc.

The article doesn't explain very well exactly why Bush is responsible for high gas prices. Even if Iraq was producing it's prewar levels of 2 million barrels a day, we would still be paying well over $125 a barrel. Demand outstrips supply.
Instead Bush is responsible for the high price because he did absolutely nothing to reduce domestic or foreign consumption. In fact he encouraged MORE! He could have adopted California's earlier mandate (the car manufacturers eventually torpedoed it) to provide non-fossil fuel alternative vehicles, signed the Kyoto Protocal with conditions that the world would unite in reducing consumption, spent more time educating the public about the eventuality of peak oil rather than pretending 'terrorism' was a main issue and finally he could have made friends with countries like Venezuela and Russia instead of trying to 'corportarize' them.

http://www.petitiononline.com/mod_perl/signed.cgi?everyman&1

In February 2003, Murdoch expressed his support for the then-pending invasion of Iraq and stressed the potential economic benefits of such action. "The greatest thing to come of this to the world economy, if you could put it that way, would be $20 a barrel for oil," he told The Bulletin, an Australian magazine, in a February 12, 2003, interview.

The Bush regime is at least partially responsible for the drastic hike in price at the pump - and thereby has finally done something good for us - because those higher prices are making Americans begin to do what we should have been doing all along, which is to burn less of the stuff. Reality is beginning to set in, although it will be far too long in coming. We cannot continue to consume at the rate to which we have become accustomed. It would be better for us in the long run if we were paying $12 a gallon like the Germans.

Live locally. Buy locally. It's the right thing for the ecology, and the right thing for your local economy, and the right thing for your personal well-being.

at least 9/11 and the Illegal Iraq War has profitted SOMEONE.

If 911 didn't happen on its own, Exxon would have had to MAKE it happen in order to survive.. (see their declining profits prior to)

The shareholders at Exxon must thank Osamma bin Laden on a daily basis for their million$ of windfall profits.

http://www.oilwatchdog.org/resources/OilProfitQtrly-Exxon.pdf

Exxon profits have skyrocketed in the last 5 years, from 10 billion in 2002 to 40 billion in 2007

coincidence?

http://www.oilwatchdog.org/resources/OilProfitYearly-Big5.pdf

Oil, Israel, Iran, America and the High Cost of a Single War-Like Remark

by Dave Lindorff

One remark by a minor Israeli cabinet officer hinting at a possible US or Israeli attack on Iran has sent oil prices up by a record $11/barrel to a record $139 per barrel Friday. That should tell us what would happen if the Bush administration were crazy enough to attack Iran, or to let its vassal state of Israel do it......

ENTIRE ARTICLE- http://www.smirkingchimp.com/thread/15116

Oil Zooms Nearly 9% Higher to Record $139 After Israeli Threat to Attack Iran

Crude oil prices went on a record-setting surge Friday as fears of a new Middle East conflict were fanned by comments from a top Israeli official about Iran. New York's main oil futures contract, light sweet crude for July delivery, leapt 10.75 dollars a barrel -- its biggest one-day jump ever -- to close at a record 138.54 dollars.........

ENTIRE ARTICLE- http://afp.google.com/article/ALeqM5hkLCJIKdipOHqJ8bwdjN1JUZSFtA

"Nowhere does the article claim that "Bush's roiling" has been limited to Iraq "

I wasn't responding to the article when I asked the question, I was responding to Dillan.

"Yes, Bush and Cheney are completely responsible for the meteoric rise in oil prices. And what is most obscene is how much they themselves, their families, and their cronies (all deeply entrenched in the oil business) are profiting from that increase."

Please explain both sentences and provide specific evidence.

While the author cries over spilled milk about not getting "entitlement" for solar, wind, and the unmentioned hemp not paying attention to the fact that for the past 30 years, BIG GOVERNMENT has given her and us the MIDDLE FINGER, here's a better solution I shall give you so you don't have to wait until 2030 to get it.

Do a google search on

solar power generator
wind power generator
"make your own biodiesel" "petroleum free"
hemp "make your own fuel"

If you have time to blog around and/or watch American idol, you sure as hell can find time to devote your mindset and skills towards building those alternative renewables and draining Big Government and Corporate America of its oil revenue !

Yes, Bush and Cheney are completely responsible for the meteoric rise in oil prices. And what is most obscene is how much they themselves, their families, and their cronies (all deeply entrenched in the oil business) are profiting from that increase.

Before Alexander the Great began his conquest of the world, he pulled together his fellow Macedonians and asked whether they would like to continue farming the land and working at their normal occupations, or go to war and pillage, plunder, and rape their neighbors and become wealthy. What do you suppose was their response? We have the same question before us today. Become satisfied in our new, oilless, peasant-style America, or go forth and do our best to dominate the mideast.

Lord Trigo: "Scheer is trying to convince people that our present wastrel way of life can be preserved if we just had better leaders."

The article says no such thing.

jakenewton: "What has happened in Iraq in the last year that would have caused crude oil to double in price over the same time?"

Nowhere does the article claim that "Bush's roiling" has been limited to Iraq but the link is rather clear: Bush's strategy has been to perpetuate instability in the world's primary oil-producing region.

jj

Hmmmm.... I blame/credit rising oil prices for the ongoing demise of the monster-SUV industry and the looming containment of exurban sprawl. And I think of this as progress. So if Mr. Bush, and not a perfect storm of structural and mechanical currents in the world markets, is to blame/credit for these rising prices... Does this mean that Mr. Bush has somehow, serendipitously, enabled progress?

Well, at least I'm trying to keep an open mind about the fella...

"I have heard experts on the Diane Rehm show state emphatically that the Iraq war has little or nothing to do with the woes of the American economy. "

What has happened in Iraq in the last year that would have caused crude oil to double in price over the same time?

"Bush's "roiling" is only part of the story."

Yup, the author is off base.

Thank you Mr. Scheer for saying what should be "obvious" but is instead obfuscated by the experts and pundits. I have heard experts on the Diane Rehm show state emphatically that the Iraq war has little or nothing to do with the woes of the American economy.

Now we have Republican's blaming oil prices on the Democrats and unbelievably having people believe it.

The price and demand argument is undermined by the fact that the current situation in price and demand has been around for quite awhile but only now has been escalated in a few years, and months. To believe that this is a natural price and demand market driven phenomenon alone and that the Bush policy and Cheney's contriving have no effect is ludicrous.

I can only say the John McCain's experience is of the wrong minded and ignorant in that he will certainly continue on the misguided notion of victory. As history repeats and our leaders ignore, you cannot defeat an internal conflict of people fighting to remove invaders.

Save your old Soviet rubles, Russia will rise again and with its energy supply will be ruling the roost. Smarties like Pastor Wright and me will be sitting pretty as it all comes home to roost

andersdl--You need to learn the fact that at the end of a futures contract, the holder MUST take physical delivery of the product.

Bush is an idiot, and his military misadventures certainly haven't helped matters, but higher oil prices are inevitable due to increasing global demand. There just isn't enough for everyone in the world to have their own Hummer.
Scheer is trying to convince people that our present wastrel way of life can be preserved if we just had better leaders. Sorry, Robert, the party's over. Bush, Obama, McCain; doesn't matter. Whoever the next president is, their chief job (if they're smart enough to realize it) is to prepare America for a "soft landing" instead of a hard crash.

Some day, for sure, we will find out that Bush and Cheney are profiting mightily by the rise in oil prices. Just you wait.

In the long run, supply and demand will result in never-ending oil prce increases, however, the current runaway oil price inflation is being 10% driven by supply and demand and 90% by deregulated commodities traders who are staging trades just like Enron did with the west coast power grid in 2000. Since only a handful of the Enron culprits went to jail, it is highly likely that many of the same players are making a killing in oil trading. there next target is world water supplies.

The deregulation orgy started on January 20, 1981 when Ronny Raygun was inaugurated president and probably hasn't ended yet since the Republican solution to any financial crisis is to enact even more deregulation.

Until the US re-establishes New Deal financial industry regulation and replaces the Federal Reserve Chaiman and Governors with people whose monetary policy helps the 98% rather than the 2%, the US will continue to experience one financial crisis after another and you will become poorer with each succeeding crisis.

I thought EVERYTHING was already Bush's fault.

Where am I again? This is a "progressive" website, right?

1.World Sweet light crude production is peaking or past peak.

2.World Liquid petroleum production overall is peaking or past peak.

3.U.S. production peaked 35 years ago.

4.Damn that Bush!

Wait, no, that last one doesn't fit.

-matti.

Bush's "roiling" is only part of the story. Fundamentally, we are facing a declining amount of oil available for export that has the world's primary importers bidding against each other driving the price up. The most recent article at TheOilDrum.com discusses the role of the North Sea's decline in production in the rising price of oil. Scheer, like most Americans, has a steep learning curve regarding oil and its fundamentals.

The Germans and the Turks as of May 30 were paying $11.49/gal for gas. The current US average is $4.052/gal. The half-way point to the German figure is about $7.80/gal. Where will the US economy be with gas at the latter figure in comparison to the German economy already accustomed to a much higher price?

Well written, but I'd argue that the Iraq misadventure will be seen as the second biggest blunder of bush's presidency of error. Iran will be nuked, hopefully not with ICBMs fired from the mainland as Russia might regard that as an attack on them and launch their ICBMs on the warning of a US launch.

Reagan was senile, bush is evil. We're on the brink of a major nukular war the like of which hasn't been seen since '62, and the media - rather than reporting the fact of this lunacy - is chearing the psychos on... Lord have mercy.