Speculators, Cartels and Myths of Scarcity: How War Pushes up the Price of Oil

Oil Wars/Wikimedia image

Dean Henderson
Global Research

Last week, as if to justify his Libyan crusade, President Obama echoed the prevailing “peak oil” myth, stating that “we must accept the new reality that from here on out, demand for oil will always exceed supply”.  It was music to the ears of the Rockefeller/Rothschild energy cartel and tax-dodger oil traders in Zug, Switzerland alike.  Both know full well that oil companies pay around $18/barrel to get crude out of the ground.

Big Oil rings up its usual quarterly record profit, speculators led by Goldman Sachs and Morgan Stanley tack on another $50/barrel and people get gouged at the gas pump.  Governments “tighten their belts”, economies contract and the myth of scarcity (root word: scare) encourages a race to the bottom for the global masses, alongside an historical concentration of power and wealth by the well-fed and fueled global elite.

A day after Obama’s endorsement of concentrated corporate power and casino capitalism, the US Department of Energy reported that the main US oil stage depot at Cushing, Oklahoma was holding 41.9 million barrels of crude oil, very near its capacity of 44 million barrels.  In other words, the US is awash in crude oil.

Here in South Dakota, the USDA announced that farmers plan to plant an additional 850,000 acres of corn- the most since 1931.  According to a March 10 bulletin from USDA, Brazil’s corn crop is 2 million tons higher than last year.  Yet corn futures on the Chicago Mercantile Exchange trade at record prices.

According to the same USDA report, “U.S. wheat ending stocks for 2010/11 are projected higher this month on reduced export prospects. Projected exports are lowered 25 million bushels with increased world supplies of high quality wheat, particularly in Australia, and a slower-than-expected pace of U.S. shipments heading into the final quarter of the wheat marketing year.”  Yet wheat futures hover near record highs.

There is nothing alarming in the report about supplies of beef, poultry, eggs, milk, sugar or rice either.  Yet food prices continue to skyrocket.



The global elite know that both food and energy are paramount to life. Control over these two most basic needs means control over people.

After the 2008 acquisitions of Swift, Smithfield and National Beef Packers by Brazilian meat-packer JBS, there are three conglomerates that control over 80% of beef-packing in the US – Tyson, Cargill and JBS.  These same companies control most of the burgeoning cattle feedlot industry centered in SW Kansas and SE Colorado.  They also dominate the pork, chicken and turkey industries.  Cargill is the largest grain processor on the planet, handling a full one-half of global grain supplies.
  
Four giant companies are making a play to own not just all the oil, but virtually all energy sources on the planet.  In my book, Big Oil & Their Bankers…I dub them the Four Horsemen – Royal Dutch/Shell, Exxon Mobil, Chevron Texaco and BP Amoco.
  
These companies control crude oil from the Saudi well-head to the American gas pump and profit from every step of processing, shipping and marketing in between.  While reactionary Republicans blame environmentalists for the lack of US oil production, it was these oil giants who capped permitted wells in Texas and Louisiana and moved production to the Middle East – where Bangladeshi, Filipino and Yemeni workers are paid $1/day to work the oil rigs.
  
Royal Dutch/Shell and Exxon Mobil are the heaviest and most vertically integrated of the Four Horsemen. These behemoths have led the charge towards horizontal integration within the energy industry, investing heavily in natural gas, coal and uranium resources.

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