But they along with many other claim there is no shortage of oil nor has there been, that the run up in prices are being caused by speculators and the decline in value of the US dollar.

So if this is true, why are the Saudis caving, why aren’t they sticking to their guns exposing the truth, that it’s Wall Street that’s responsible for the high prices of oil?

To answer that, we have to look at how the price of oil is decided in the first place.

Seeing as how oil is pumped out of the ground all over the planet and sold for may varying prices depending on supply and demand, then the way the price is chosen becomes difficult to access. And since speculating in the crude oil commodities futures market is only engaged by those who know the industry best, then the price is decided by taken the difference between what the highest projected price as compared to the lowest cutting it down the middle coming up with a fair gamble for what the price ought to be. And that becomes that market standard for the price of a barrel of oil that decides what the price of a gallon of gasoline is.

But recently a new trick has been discovered by big investors who have nothing to do with the oil industry who are realistically not supposed to be engaging in trading commodities futures related to it. They found if they always buy future contracts betting the price would go up, that if they flood the futures market with contacts all heading in one direction, then the price will always go that way, which has nothing to do with supply and demand for oil. In fact what they’re doing lessens demand so reserves of crude oil and gasoline are at all time highs because the price is too high for Americans to purchase it in the fashion we are accustomed to.

So if this is what’s going on and the Saudis know it, why are they caving into pressure to shore up a problem we’re creating for ourselves when they have more than amply supplied us with enough oil to meet our needs? Why are they allowing themselves to be dragged into a problem we’re creating for ourselves when by doing so gives the appearance they are what’s behind causing the high price of oil?

The answer is simple. If we’re dumb enough to but oil from them for twice as much as it’s worth in such large amounts that there simply isn’t enough for us to throw our money away on even though we can’t use or afford to buy it once it’s been turned into gasoline, then why should they object. They only reason that more oil is not being speculated on now is because all that is out there has already been bought and overpriced so we can’t afford it now. So more oil only means more speculation, more money for the oil companies, more money for the Saudis, and higher prices for us, which I don’t know what kind of magic crystal ball they’re looking into because we’re not going to be able to buy it once they get it out of the ground and turn it into gasoline having to pay the unrealistic price the speculative market attaches to it.

And sooner or later congress will put a clamp on big investors so they can’t abuse the futures market anymore. Then Saudis will have to cut back production to levels below where it is now to recoup their assumed losses which will drive the price back up where it is now. It seems that once those who make profits from oil get accustomed to the level of wealth we’re paying them for it at any given time, they will be hard pressed to take any less, which is the way most of us are. I was homeless once. So the dump I live in now is a palace. I won’t mind climbing up the ladder of success to a high quality lifestyle but I certainly don’t want to go back to where I came from.

Oil has become like gold where when an economy takes turn for the worst, the old fashion way of protecting wealth was to buy gold. But gold is already so overpriced that now so they’re buying oil. I just wonder who is going to pay to store all that oil, and gasoline, and corn, and wheat, and all the other commodities that are being speculated on, until we rebuild our economy in such a way that we can afford to buy it. That’s is what our financial and political leaders have laid on our plate, find a way to be able store and later buy all the things we need today at prices that in no way represent the basic economic principles of supply and demand.   

So what we need is a domestic solution to our transportation fuel needs that can't be monopolized by the kind of Wall Street investors and politicians that run our economy now, something that can be produced at the state and community level, something the individual can count on as simple and reliable as bicycle only on four wheels and can travel in excess of a hundred miles an hour, something that takes fuel issues related to automobiles off the table as a problem that has to be solved at the national level. And perhaps we need to solve our food needs the old fashion way, with gardens instead of lawns with the weekends being very busy during canning season. And it will come. It is the only way out so that is the way we will go, mark my word on it.   

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