Blogs > So Bush can't control the price of oil?

Oct 29, 2006

So Bush can't control the price of oil?



The other night the CBS Evening News (do they still call it that?) reported that there is no way President Bush could control the price of oil ... no way, in other words, that he could lower the price in the months before the midterm elections to help fellow Republicans retain their mortal grip on Congress as so many conspiracy nuts surmise.

Whaaaaaaaaaat?

There is abundant evidence that presidents for years have been influencing the price of oil. It's one of the few commodities whose price they can affect.

All they have to do is call up the Saudi ambassador and ask them to increase the supply of oil.

This is something they do from time to time.

As Bob Woodward reports in STATE OF DENIAL (read it, read it!), p. 287:

Prince Bandar was back in the Oval Office on Friday, February 20, 2004, to meet with Bush, Rice and Card. ... Bush repeated his appreciation for the Crown Prince's vision and efforts on democratic reform."Maybe the speed of this process could be sort of expedited," Bush said, agreeing that the reforms had to be homegrown. He then thanked Bandar for what the Saudis were doing on oil--essentially flooding the market and trying to keep the price as low as possible. He expressed appreciation for the policy and the impact it could have during the election year.

Woodward doesn't say but it's obvious his source for this account is Bandar. I have no reason to doubt it.

I have no idea if President Bush has asked the Saudis to flood the market this election year or not. He might not even have to. The Saudis certainly know what would be of help to the Republicans without anyone so much as making a simple phone call. All I am saying is that it is ridiculous for CBS and others to maintain that the president has no power to influence the price of a gallon of gasoline. That's foolishness.


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More Comments:

HNN - 10/20/2006

I am happy to respond to dissent.

1. I didn't argue that Bush has tried to control the price of oil. I argued that he has the power to affect the price of oil.

2. The reader who commented on psychology is correct, of course. The price of oil is highly sensitive to psychology. Nothing I said here contravenes that basic point about the oil markets.

Mike A Mainello - 10/20/2006

Take note - Most of the writers on this blog don't respond to dissent.

Contrary reason and logic is either ignored or ridiculed.

This is why the blog is dying.

T R Ploski - 10/20/2006

Absolutley impossible that any person, or even group of entities could control a global, publicly traded commodity of this size. do the math, follow the flow of oil.

on the supply side, The Saudis cannot swing production anymore to the degree they did in the old days. They can ramp up by what?, 2 million bbls/day, peanuts, and not enough to influence prices.

Where the administration can influence prices is in terms of psychology. Just take alook at all the bellicose stuff in the first 7 mos of 2006, and rising prices in the face of burgeoning inventories, and since then...a change of rhetoric, and prices fall.

I've blogged extensively about the idea of "control" if you are interested, I will keep an eye on this post.

Oscar Chamberlain - 10/19/2006

Rick

I understand the suspicion, but you are speculating without almost no facts whatsoever. And the one truly interesting point that you make--which is that the Saudi's might cooperate with him--relies on the premise that they want Bush and the Republicans to win in November 2006.

Family ties or not, that's debatable, particularly since Bush will be a non-factor in just over two years.

Mike A Mainello - 10/18/2006

Sorry to be so cynical, but it sure is fun to watch you guys flame out. Posting one consipiracy after another. Bush forces oil prices to drop so republicans can be elected, what a hoot. I guess he asked Jerry Falwell to talk with God and spare the US of major hurricanes this year. Lets not forget Plamegate. I am sure the special prosecutor is secretly a republican or Rove bought him off somehow.

No wonders no one watches CNN or MSNBC, at least Fox puts you on as balance.

Keep up the laughs.