Oil Price Conspiracy and Manipulation

In recent years, the rapid increase in oil prices has sparked conspiracy theories. This is not just water cooler talk; numerous political leaders in Congress have raised the issue. The extent of the answer depends, in large part, as to how suspicious the observer tends to be. However, the notion that global oil prices are set by free market forces can be jettisoned. Prices are not entirely set by independent forces; the mere presence of OPEC illustrates that a form of conspiracy already exists. After all, doesn't a cartel exist to control supplies of a commodity (oil, diamonds, etc.) in some manner to maintain or raise prices? OPEC oil price targets are often issued by the organization.

In the novel The Gambit, a more ominous scenario of an oil price conspiracy is raised in a fictional setting. The plot indicates not only that such a conspiracy is possible, but the author endeavors to also show how it might be achieved. A small group of influential men band together, and make financial contributions accordingly, for the sole purpose of conceiving and "engineering" terrorist strikes against certain strategic elements of the global petroleum supply chain and rocket oil prices as a result. The dramatic price increases afterward not only enrich the conspirators, who have built a substantial speculative trading position in crude oil beforehand, but also serve a key strategic agenda as well: forcing a massive transfer of wealth from the consuming West, particularly the U.S., back to Islamic oil producers. Two governments, either directly or indirectly (Iran and Saudi Arabia), stand behing the conspiracy in some form or another. In the case of the Saudis, a rogue prince masterminds the effort as a means of furthering his ambitions to ascend to the throne, backed by like-minded radical prices tired of the Kingdom's accommodation, as they see it, to American policies.

The timing of the conspiracy is crucial: undertaken during a tight, presidential election campaign in the U.S. This timing is not accidental. The American president has been bought off, years ago, by the same Saudi price leading the conspiracy. A coopted Chief Executive is boxed in to a large degree, restricted in response to the treachery underway.

The ever-increasing oil prices resulting from the terrorist shocks paint a picture as to the vulnerability of global oil markets, showing the susceptibility to rumors and innuendos of every sort, some deliberately planted by the scheming group. The Gambit provides a backdrop as to how oil markets work, the volatility and leverage available to market players, and the resulting fertile ground for American hedge funds to stampede into the markets and create a feeding frenzy when sensing a giant momentum play underway. These same funds in essence become the American and global economy's worst enemy. At every step of the way, the conspiracy accounts for, manipulates and takes advantage of the tendencies inherent in the system.

The Preface to The Gambit raises an interesting question: to what extent has the conspiracy detailed in the book already occurred? Beyond OPEC itself, it is not too difficult to imagine a form of conspiracy already at work. Iran, for example, has made hay out of nervous oil markets due to its nuclear efforts. The country hypes threats endlessly, designed to keep the markets on edge and higher than otherwise would be the case. Isn't it rather easy to imagine Tehran financing terrorist elements in Iraq for the sole purpose of crippling that country's competing oil exports? Who is financing the Nigerian rebels and their attacks on that nation's oil production and export infrastructure? Certainly, a Hugo Chavez would not pass up an opportunity to tweak the U.S. in some manner and ratchet oil prices in the process. The possibilities are endless. The Gambit points out one of many scenarios available and does so in a fictional context designed to educate and entertain the reader.

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