America will never be really free if we continue to rely on oil from other nations. The U.S. is the 3rd largest producer of crude oil in the world (Only Saudi Arabia and Russia produce more oil than we do), and we are by far the largest consumer of oil, using 25% of the world’s consumption every day. Therefore, the U.S. is the largest oil market in the world and American’s actions help determine world oil prices. As oil and gas prices continue another steady climb, lots of stories are written concluding that the increase in oil and gas prices are due to supply and demand with the only solution being an increase in domestic supply or reducing domestic demand…pure and simple.
However, this is not the whole story…
One of the first things to consider is “who exactly determines oil prices”? It sure isn’t OPEC. The international cartel isn’t what it used to be, as 75 percent of America’s oil comes from non-OPEC sources. Today, oil prices are determined on international exchanges based on what traders are willing to pay. And who are the people trading oil and setting the price? Managers of hedge funds, investment banks, and others out to make a quick buck speculating on the price of oil. I believe market speculations are to blame. The trading markets that set oil prices are severely under-regulated opening the door to Enron style manipulation of crude markets. In fact, there is a strong chance such manipulation may be occurring right now. While they’re making money, the rest of us are paying for it at the pump.
http://ireport.cnn.com/docs/DOC-572126
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