Repeat after me three times ... There has Never been a Shortage of Oil ' There has Never been a Shortage of Oil ' There has Never been a Shortage of Oil.

Ever since 1999 when oil traded at $12 a barrel there has never been a shortage of crude oil. What there has been is a whole lot of empty fear laden propaganda containing many 'what ifs'. None have come to anything and yet the rhetoric continues to pump up the price of oil to 'lubricous' high levels ... Today oil is trading at $118.20 a barrel. 

The strange thing is, it is American intellectuals who find reasons why oil should go higher by expressing much of the propaganda that are just half truths at best. They tell us China and India are using a lot more oil. Well, the truth is most Indian and Chinese ride bikes or walk, so the amount of extra oil is only a few percentage more. Nothing to justify a large rise. There has been no increase in usage in the USA. With a recession looming the price should have gone down, not up.

Likewise, the weak dollar is blamed for a big increase in price. The truth is the dollar has not fallen anything like one-tenth of its value, however, oil has increased tenfold since 1999. On value of dollar basis crude oil should be around $18 a barrel from 1999 to today.

Probably the main reason for oils nonsensical price is the verbal propaganda emanating from the mouth of the Iranian president who hates Israel and the USA. So how does the USA answer him. Why, by letting oil speculators send the price of oil up 10 fold from 1999. Good game for a few and empty pockets for the majority.

Mercantile exchanges were formulated many years ago so that manufactures could go to a central market place and buy raw commodities on an open outcry basis, from companies that mined and harvested raw commodities. It was a fair way of dealing ... when demand was high the prices would be bid up by the manufactures who needed the supply. Likewise, when demand was slack the prices would fall to a fair market level. The law of supply and demand reigned supreme. 

In today's futures world it is a significantly different picture. Any Tom, Dick or Harry can bid up the price of a commodity. When fear and greed are induced by a media that use sensationalism to report every world event, prices can get completely out of control as is the case today with the price of oil. Every dollar increase on the price of oil feeds terrorist sponsoring states coffers so that they can build more missiles and fund more terrorism.

If the G8 governments allow this trend to continue oil will hit $150 soon. This will cause a world recession the like of which has never been seen ... Governmental controls are needed now. 

When currencies trade erratically central banks step in to balance the prices to a more sensible level. Equivalent action needs to be taken now to bring down the price of oil to around $45 - 65 a barrel. 

The only winners in this propaganda game are the greedy speculators, oil companies and a few oil producing countries who are laughing all the way to the bank. 

The easy solution is for governments to set up a world agency that oversee the prices of commodities and regulate the increases by true supply and demand factors. The mercantile exchanges are no place for essential natural assets that belong to people of the world, not the greedy speculators ... But who would think of doing something so simple... Best let propaganda ridden speculation take center stage and send the world into a bigger and deeper recession than needed... La-de-dah!