The invasion of Iraq by Britain and the US has trebled the price of oil, according to a leading expert, costing the world a staggering $6 trillion in higher energy prices alone. 

The oil economist Dr Mamdouh Salameh, who advises both the World Bank and the UN Industrial Development Organisation (Unido), told The Independent on Sunday that the price of oil would now be no more than $40 a barrel, less than a third of the record $135 a barrel reached last week, if it had not been for the Iraq war. 

He spoke after oil prices set a new record on 13 consecutive days over the past two weeks. They have now multiplied six-fold since 2002, compared with the four-fold increase of the 1973 and 1974 "oil shock" that ended the world's long postwar boom. 

Oil: A Global Crisis

Drivers Seethe as Gas Prices Climb
27 May 2008By Miriam Elder / Staff Writer

Ramil sometimes spends up to 24 hours a day in his taxi, trying to take in fares in a constant game of catch-up to stay ahead of the rapidly growing cost of living in Moscow.

Now with gasoline prices steadily rising since April, the game just got all the more difficult.

"It seems like every week the gas price rises by 10 to 20 kopeks," he said on a recent afternoon, lounging in his car at the end of Arbat as he waited for a fare to walk up to the window.

The soaring cost of food and rent is no longer the only sign of Russia's runaway inflation rate, which passed 14 percent in April, according to official statistics. Nearly all the goods in the country's consumption basket have been hit, feeding social discontent despite overwhelming support for the new ruling duo of Prime Minister Vladimir Putin and his protege, President Dmitry Medvedev.

On Saturday, hundreds of drivers rallied against rising gas prices in about 50 cities, including 200 in rain-drenched Moscow. A previous protest, in late April, saw hundreds of drivers weaving a slow train through the streets of Vladivostok, honking their horns.

The French president is also battling with the price of petrol. Presently French fishermen are on strike due to the cost of diesel that has reached stratospheric heist. Thus the French president caught like our Mr Rudd, Aussie PM, between a rock and a hard petrol pump, has decided to help the poorest people with an extra subsidy. But like everywhere else around the little planet, the basic taxation stays put... Elsewhere in the world people are fixing the leaks on the tyres of their bicycles...

One thing that is amazing is, anyone in government should know that the public government system leaks like a thieve in the night. Thus any "debate' within should be kept to a minimum and proper consensus should apply with one voice to smitten a "our petrol price will always be lower than yours" opposition. Johnnee used to be good at smittening, making sure everyone working for him got their lips sealed with araldite or singing the same note.

I'm all in favour of "open" government as long as indecision (a natural process of government) is kept in the sausage factory... Mind you on that level, Frank Sartor (Minister for over-development in New South Wales) has decided to equip his sausage decision making with a bulldozer, by-passing the local Councils. Not a good look, unkind to the kind people and the experts, but aligned with the purveyors of low-ceiling concrete jungles. Sartor's Napoleonic grab of power is outrageous. Hopefully he will be gone soon, unless he has araldited his pants to the benches...

German leaders are to propose a worldwide ban on oil trading by speculators, blaming the latest spike in crude prices on manipulation by hedge funds. 

It is the most drastic proposal to date amid escalating calls from Europe, the US and Asia for controls on market forces, underscoring the profound shift in the political climate since the credit crunch began. India has already suspended futures trading of five commodities. 

Uwe Beckmeyer, transport chief for Germany's Social Democrats, said his party would call for joint measures by the G8 powers to prohibit leveraged trading on energy contracts. "It's an extreme step but it has to be done," he told the Berlin media. 

Mr Beckmeyer said the last 25pc rise in the price of oil to $135 a barrel had nothing to do with underlying supply and demand. “It’s pure speculation,” he said. 

Germany In Call For Ban On Oil Speculation

Iraq not invaded for oil... ????

I wrote this when the basic price for an oil barrel was a bit more than a third of the cost today...

The Commodity Futures and Trading Commission (CFTC) is investigating trading in oil futures to determine whether the surge in prices to record levels is the result of manipulation or fraud.  

They might want to take a look at wheat, rice and corn futures while they're at it.  

The whole thing is a hoax cooked up by the investment banks and hedge funds who are trying to dig their way out of the trillion dollar mortgage-backed securities (MBS) mess that they created by turning garbage loans into securities. That scam blew up in their face last August and left them scrounging for handouts from the Federal Reserve. Now the billions of dollars they're getting from the Fed is being diverted into commodities which is destabilizing the world economy; driving gas prices to the moon and triggering food riots across the planet.  

For months we've been told that the soaring price of oil has been the result of Peak Oil, fighting in Iraq, attacks on oil facilities in Nigeria, labor problems in Norway, and (the all-time favourite) growth in China. It's all baloney. Just like Goldman Sachs prediction of $200 per barrel oil is baloney. If oil is about to skyrocket then why has G-Sax kept a neutral rating on some of its oil holdings like Exxon Mobile? Could it be that they know that oil is just another mega-inflated equity bubble---like housing, corporate bonds and dot.com stocks—that is about to crash to earth as soon as the big players grab a parachute?  

There are three things that are driving up the price of oil: the falling dollar, speculation and buying on margin. 

 The Great Oil Swindle: How Much Did The Fed Really Know?

Kevin Rudd has accused oil-producing nations of deliberately distorting the supply of oil to maintain high prices and has demanded the Group of Eight nations intervene. 

Mr Rudd, who will attend the G8 heads-of-state meeting in Hokkaido from July 7-9 as a guest of Japanese Prime Minister Yasuo Fukuda, has called on energy consuming nations to "apply a blowtorch" to OPEC. 

But the Prime Minister's aggressive rhetoric is not matched by energy ministers from the world's largest oil-consumers, who have softened their demands for OPEC to increase supply, focusing instead on how consumers can improve energy efficiency.  

Senior officials from OPEC countries have flatly rejected calls for a boost to production, saying prices have surged because of market speculators putting large amounts of funds into oil, not because of a lack of supply.

"What Kevin Rudd does or says has no bearing on the global oil price one way or the other. He is simply trying to distract us from the fact that he over-promised on what he could do about Australian petrol prices at the last election," Opposition Treasury spokesman Malcolm Turnbull said.  

"To understand how little effect he is likely to have, you really just have to think how Australia would respond if the Chinese said Australia should produce more coal or iron ore in order to reduce the price they are paying for our commodities."  

Kevin Rudd's OPEC Supply Call Out Of Step With G8 Leaders

Yes John,

But this article (and Rudd-bagging by the Australian opposition) is also out of step with Bush's action. Bush himself has pleaded with the Saudis to increase production. The Saudis have declined. The speculation on oil is very complex. The spectre of peak oil is around the corner (2013), if not upon us already as many of the oil supply countries fib about their "reserves". The demand for oil is increasing. As world population climbs towards 7 billion, then 9 billion, oil consumed at about 90 million barrel a day at present, would go to 150 million barrel per day by 2050, even if we reduce consumption by 20 per cent per capita. This reduction will be far offset by developing countries reaching a higher status of "consumerism".

But peak oil assumes a possible maximum production of 95 million barrel per day, full stop.

Thus there is a worrying deficiency looming fast on the horizon. The Saudis would have to know that their oil supply is verging on peak oil. The Iraq war was about increasing oil supplies for the US (Greenspan). So far, it has fizzled a bit but to some extend one (me) wonders if not deliberately by the US to enforce the Saudis to spend their reserves first.

There are other processes in the pipeline like coal liquefaction and bio-fuels that could replace or add to the oil. Both have huge problems are are costly. Bio-fuels are massively increasing basic food costs while coal liquefaction can be more greenhouse warming ever.

Without too much going into details, the only solution to world energy supply, global warming and human consumption will be to discover "change without growth" — the way nature mostly worked in specific environments with its processes over the last few eons. Whether it's the natural way or not, it will have to be the way for humanity: "change without growth". It's a complex process that demand a total rethink of the capitalistic system — a system that is somewhat bloated and unashamedly wasteful of resources in order to profit a very few, while giving crumbs to the "masses". The Chinese have already applied "change without growth" in their population policies. Now this needs to be adapted to managing world capital. Very hard to convince the thieving priests of money "markets" who rely on taking a cut of 15 per cent, permanently.

Presently, all we need (like a hole in the head) is a war with Iran and a hurricane in the gulf of Mexico to push the cost of oil beyond US$400.00 a barrel... The speculators know that — but these are the thieving priests by excellence. They steal before the mad rush... We have not seen the beginning ot it all yet.

Rudd (and the others) is caught between a rock and a very hard place and nothing can be done about it unless all realise the situation is a lot worse than it appears, and start rethinking the whole capitalism structure. Soon, it will be a necessity.

I could be wrong...

In the above blog, I mention the eventuality of the price of oil hitting $US400 a barrel... It is inevitable, the only question being when. In 5 minutes or 50 years? Be prepared. And by the way, the Ruddhybridmobile is not going to fix the problem, but it's a small step in the right direction. Such a gas saving device should have been on the market 40 years ago and not just appear on the drawing boards of this sun-burnt country now. But then is there real savings?

Due to my crazy work in 1971, I was one of the first drivers of the new Kingswood. It felt like driving a tank compared to the quite advanced European cars I had used before. After the Kingswood, I had to drive a 2 tons Pontiac for a couple of days. Sure petrol was 10 cents or such a liter or such, but the ratio of efficiency versus the size of the wing nuts did not make sense...

So what can we do about it? In five minutes or in fifty years?...

Reduce consumption massively. Re-organise the economy so that people are less dependent on big supply and more self-reliant. Make sure that we become misers without becoming scrooges.

More efficient public transport and less moving about.

Reduce the size of dormitory style new cities and allow for a "mixed business", manufacture set ups nearby living areas. Minimise the use of any air conditioning and transport. 

Contain the world population by the fairest means.....

and more... 

----------------- 

 An ominous warning that the rapid rise in oil prices has only just begun

By Danny Fortson, Business Correspondent
Wednesday, 11 June 2008

The chief executive of the world's largest energy company has issued the most dire warning yet about the soaring the price of oil, predicting that it will hit $250 per barrel "in the foreseeable future".

The forecast from Alexey Miller, the head of the Kremlin-owned gas giant Gazprom, would herald the arrival of £2-per-litre petrol and send shockwaves through the economy. His comments were the most stark to be expressed by an industry executive and come just days after the oil price registered its largest-ever single-day spike, hitting $139.12 per barrel last week amid fears that the world's faltering supply will be unable to keep up with demand.

Mr Miller's prediction is well beyond even the most heady market forecasts, the most extreme of which fall between $150 and $200 per barrel, and was explained only by vague references to demand from the developing world. It nonetheless stoked an already febrile atmosphere of growing public anger across Europe over a soaring fuel cost that is wreaking havoc at nearly every level of the economy. 

Worldwide protests over the rising price of fuel escalated today, with the Philippines presidential palace besieged by lorries, fishermen burning their boats in Thailand, and Spanish petrol stations running dry as hauliers blockade major roads.  

Violence has already claimed lives of lorry drivers on either side of the dispute, while one haulier was nearly burned to death in his cab by strikers. 

Hundreds of lorries and minibuses blocked roads in Manila leading to Malacanang Palace today to demand the lifting of a 12 per cent sales tax on fuel. Petrol prices there have risen about 24 per cent this year. 

Traffic ground to a halt as anti-riot police halted the convoy, including about 500 tuk-tuks, Manila's three-wheeled taxis.  

In Thai capital Bangkok, tens of thousands of heavy lorries are threatening to cause havoc while farmers are demonstrating and fishermen have begun burning their boats in nationwide protests against soaring prices of fuel and other essentials.  

Fury At Soaring Fuel Costs Spreads Around The World

Four Western oil companies are in the final stages of negotiations this month on contracts that will return them to Iraq, 36 years after losing their oil concession to nationalization as Saddam Hussein rose to power. 

Exxon Mobil, Shell, Total and BP - the original partners in the Iraq Petroleum Company - along with Chevron and a number of smaller oil companies, are in talks with Iraq’s Oil Ministry for no-bid contracts to service Iraq’s largest fields, according to ministry officials, oil company officials and an American diplomat. 

In an interview with Newsweek last fall, the former chief executive of Exxon, Lee Raymond, praised Iraq’s potential as an oil-producing country and added that Exxon was in a position to know. “There is an enormous amount of oil in Iraq.”  

Mr. Raymond said. “We were part of the consortium, the four companies that were there when Saddam Hussein threw us out, and we basically had the whole country.” 

Deals With Iraq Are Set To Bring Oil Giants Back

Petrol could fall to $1.50 a litre within a fortnight and interest rates appear even more firmly on hold after evidence of slowing price inflation for businesses. 

The good news comes after a fall in the international oil price last week of about $US15 a barrel. Every $US1 fall in the price of oil flows through roughly to a 1 cent fall in Australian bowser prices. 

An economist at CommSec, Savanth Sebastian, said relief for motorists was not far away. "The national average price is likely to fall by around 10 to 13 cents to $1.50 a litre in the next fortnight," he said. 

Light At Last: Petrol To Fall 

goodness me; what happened to the global oil shortage? Couldn’t, wouldn’t possibly have anything to do with speculation, would it?

Petrol should be almost four cents cheaper this weekend but motorists are still being ripped off, the federal petrol commissioner has warned. 

Regional oil prices have fallen by almost 12 per cent since they exceeded $US150 a barrel a fortnight ago. 

Average prices at the terminal gate, where retailers pay for petrol, have dropped by 11.1 cents a litre since July 14 in Sydney, but consumers only saw an average drop of 3.7 cents. 

There has been little joy for the petrol commissioner, Patrick Walker, since he was appointed to his role on February 16. The average price of unleaded petrol in Sydney has risen by 24 per cent in that time, settling at about 161 cents a litre yesterday. 

He has expressed concern that the drop in wholesale petrol prices has not been passed on to consumers this week. 

Retailers Told: Pass On Full Petrol Price Fall

Amazingly, according to John McCain, little bushit is still our saviour whenever luck infrequently wafts our way like a fragrant fart.  

At Wilkes-Barre, PA today, McCain actually credited turd-blossom for the slight lowering of oil prices (that so far hasn't resulted in under four-dollar-a-gallon gas at the pumps) by getting rid of his own father's executive ban on offshore drilling. 

The problem is, the White House isn't having any of it.

White House Press Secretary Dana Perino said: "I don't know if we fully deserve the credit ... We don't predict what happens in the market. We can't really tell." 

Even conservative journalists such as Stephen Covington doesn't buy it, either, realizing that we need to invest in alternative energy sources. 

But that doesn't matter much in McCain's La La Land anymore than it matters that there's still a Congressional ban on offshore drilling that Congress hasn't even considered rescinding.

Neither does it matter that bushit, for the umpteenth time, feigned helplessness in affecting oil prices, claiming that he didn't have "a magic wand."  

It's obvious that the only magic wand we've been seeing during this cash grab is the one Saudi Arabia, speculators and the oil cartels have been shoving up our ass. 

McCain is also conveniently forgetting that offshore drilling, even if it continues despite the Congressional ban, won't commence for another decade, which won't affect oil and gas prices today.  

So why should the little shrub be credited for inching down gas prices? 

meanwhile, at the intellectual end of the debate, US Senator Larry Craig says ….. "We won't let the Venezuelas or the Nigerias or the Saudi Arabias or the Irans jerk us around by the gas nozzle."

Now that the working stiff is maxed out on his mortgage, worried about losing his job, & trying to keep food on the table; the least Congress could do is to scatter the oil speculators; right? 

Wrong.  

On Monday, the Financial Times reported that: "A US Senate proposal designed to curb speculation & increase transparency in the energy markets was blocked by Republican legislators on Friday.  

The move frustrates Democratic efforts to show the party is taking action on record petrol prices.

The Stop Excessive Speculation Act, sponsored by Harry Reid, the Senate majority leader, fell 10 votes short of clearing a procedural hurdle." 

Unbelievable.  

US$4.00 gasoline & millions of consumers that are flat-broke & Congress still refuses lend a hand?  

What a scrubby band of sandbaggers.

The biggest ever sale of oil assets will take place today, when the Iraqi government puts 40 billion barrels of recoverable reserves up for offer in London. 

BP, Shell and ExxonMobil are all expected to attend a meeting at the Park Lane Hotel in Mayfair with the Iraqi oil minister, Hussein al-Shahristani. 

Access is being given to eight fields, representing about 40 percent of the Middle Eastern nation's reserves, at a time when the country remains under occupation by U.S. and British forces. 

Two smaller agreements have already been signed with Shell and the China National Petroleum Corporation, but today's sale will ignite arguments over whether the overthrow of Saddam Hussein was a "war for oil" that is now to be consummated by western multinationals seizing control of strategic Iraqi reserves. 

In Biggest Oil Sale Ever, Iraqi Government To Put 40 Billion Barrels Of Reserves Up For Grabs