Greed Fueled Oil Sales and The War in Iraq

That is to say, that since the beginning of the war in Iraq in 2002 the cost of gasoline and diesel fuel has sky rocketed to the highest rates in history. (AP Network News 2005) This is partly due to corporate manipulation, political manipulation, and definitely corporate and political greed. The sharp rise in gas prices has contributed to record high profits of the major oil companies. In 2007 alone Chevron executive John Hess made 47 million dollars. Meanwhile the US economy is suffering majorly, and family’s are having to make significant changes to lifestyle This recent manipulation in fuel prices was initiated, just after the invasion of Iraq. (Fox News 2008)

Rising fuel prices have put an increased burden on working class families. The average American household is expected to spend $2,600 on gas this year, a significant jump from 2002 when gas expenses averaged $1,600 yearly.(Rainer 2007[i]) Not only are the American families suffering, but transportation companies across the nation have been forced to close their doors, due to rising fuel cost. Forcing other industry’s to raise their prices, in order to ship goods globally. This is making it increasingly harder and harder for our economy to recover from the recession that we have been living in since 2002. To prove that gas prices are being manipulated we must take a look at a few historical facts in order to see this align. Outages like those that occurred in the wake of Hurricane Katrina in late 2005 had a large impact on gasoline inventories and have consequently drove up prices. Typically, refineries are shut down each year in the spring, usually justified on the grounds of regular maintenance and repairs. Each year when this happens fuel prices across the nation fluctuate to a higher than usual rate. Allowing for larger prices than if the refineries we not shut down.(Fox News 2006) Prior to the invasion of Iraq gas was averaging around $1.82 a gallon. Now it is around $3.25 a gallon.(Yahoo.com 2007[ii]) This leaves a lot of people wondering why prices have risen, remained high, and will not return to the inflation adjusted average. All across the nation people have been demanding answers as to why the prices have sky rocketed since the invasion. This is partly due to an abrupt stop in supply lines just after the invasion. And a large part of the reason why prices were so low before we went into Iraq, were because Saddam Hussein was desperately trying to generate revenue for the country. He was under selling all of the major US and European oil companies, and was able to do so because he was sitting on the third largest reserve of oil in the world. Additionally he was selling his oil at a reduced rate, so that was able to sell a higher volume in a shorter amount of time. This means Americans were able to purchase oil by the barrel at a lower rate than we are currently seeing. (MSNBC Reports 2000)

Supply and demand are important factors on prices in any market. The supply and demand for oil, were a lot more stable and aligned before Iraq stopped producing it, in 2002 and then after the supply lines re-opened the market had a higher demand, than was being supplied. This quickly drove the cost of fuel above $3.00 a gallon across the nation. Hawaii suffered the hardest hit of all the United States, paying almost $7.50 a gallon for fuel in 2005 and 2006. This is an obvious indication that Americans have suffered at the pump due to the war in Iraq, because quite simply, if we had not invaded Iraq, oil would still be flowing at a lower rate than European, or American oil. The supply wouldn’t have been slowed, and the demand wouldn’t have risen so fast. This means that if we wouldn’t have invaded Iraq, we would most likely still be paying below $2.00 for a gallon of gasoline. It may remain unknown if we invaded Iraq purely to take control of the oil exports. Many Americans have continuely cited this again and again stating that they believe the only reason we ever mounted an attack, against Iraq was purely for oil and profits. If this is the case, then we can certainly say that corporate greed is a huge factor in deciding oil prices. The simple idea that any one oil company executive can profit upwards of 40 million us dollars a year should be indication enough that greed and greed for money, play a role in what you and I are paying at the pump.

Corporate greed in the oil industry starts at the top, and runs throughout the entire industry.(Gallup News 2007 [iii]) Saudi Arabia is a prime example of this. The government controlled oil of Saudi Arabia, has been able to catapult the nation to superpower status in just a few short years. Saudi oil brought the entire country to a wealth full status, and was the sole contributor of raising palace, after palace in the desert. The entire nation was literally brought into the world energy marketplace over a short period of time.(State Department 2009 [iv]) This made Saudi Arabia the fastest growing industrialized nation in history. Saudi Arabia has the supply and demand of oil to thank for this wealth. They are able to supply something that is in high demand, making it possible for them to charge almost any price they wish for it. In 2006 Armaco a Saudi Arabian gas company produced over 3.4 billion barrels of oil.(Wikipedia 2009 [v]) Compared to 750,00 barrels produced by American oil company Chevron. (Chevron Report 2006 [vi]) The obvious difference in production leaves American fuel consumers exposed to the high cost of this supply strain. This strain has inevitably driven the cost of fuel to the current high cost we are seeing today. It is also worth noting that when gas prices were tipping the scales at over $3.00 a gallon in the united states, European gas consumers were paying over $7.00 dollars a gallon. Can you imagine how your family would have been effected under those conditions? Most of the people I know would have had to make major life changing decisions in order to continue putting food on the table. Most college students across the nation would have had to place their education on hold. And it would have been nearly impossible for our local schools to operate a functional bus system. In the area where I live, our local school board had to stop operating after school activities and a few bus routes were shut down completely. This left over 200 children no other choice but to walk to school during the frigid winter months. (Times Reporter 2004)

This recent hike in fuel prices across our nation has stirred quite a debate. From Wall Street, to my street, people are talking about the greed and manipulation of oil and gas prices. What’s even more irritating is that each time you pull your car up to the pump and spend $50.00 to fuel your vehicle for the week, your losing money that was most likely budgeted for other things. I personally know people who have had to put off a college education due to the financial strain they experience from gas prices. The economic strain has been placed on each and every car owner across the nations of this country and others. This leaves continually growing room for profiteering by the major oil company executives.

Corporate greed is not the only contributing factor to high gas prices. It can also be said that political greed is responsible, especially considering that it is possible that the United States and her oil executives, have influenced the invasion of Iraq. Politically the war in Iraq has placed the United States in a great position to profit globally. Additionally it can be noted that a lot of politicians and leaders from across this country have their hand deep in the pockets of the major oil company’s of this nation as well as others. President George W. Bush, as well as his father also a U.S. President for a combined term of 12 years, both have major interest in oil companies. The Bush families own several west Texas oil refineries, as well as other oil and gas companies which are now globally known. (MSNBC 2007) This leads a person to wonder if the owner of a failing oil company, who is also the President of the U.S. would invade Iraq to seize control of a market that has been underselling him and his family for years. The world may never know. However if this is the case, then we have no one else to thank than the American voters who elected these men Presidents of the United States.

In conclusion, American and foreign oil companies, have profited largely off of gasoline consumers, since the start of the Iraq war. Corporate greed, as well as political greed have been major contributors to the rising cost of fuel. With oil company executives, and politicians, raking in million dollar yearly and quarterly paychecks. (AP Network News 2008) Little can be done to bring gas prices below $2.00 at this point. The greed has taken hold of the few men at the top, and subsequently you and I pay for it each time we are at the pump. With our presidents and leaders, oil executives, and foreign partnerships all left in the hands of the elite, and wealthy, you and I will continue to suffer. Until a day is reached, that these oil profiteering few, regain some sense of sanity, we will continue to pay over $2.50 per gallon of gasoline.

[i] www.countercurrents.org/rainer150507.htm

[ii] http://answers.yahoo.com/question/index?qid=20071109200149AAPCFuQ

[iii] http://www.gallup.com/poll/27709/oil-company-greed-seen-major-reason-high-gas-prices.aspx

[iv] http://www.state.gov/r/pa/ei/bgn/3584.htm

[v] http://en.wikipedia.org/wiki/Saudi_Aramco

[vi] http://investor.chevron.com/phoenix.zhtml?c=130102&p=irol-newsArticle_Print&ID=992152&highlight=