Krugman quality control worsens

Michael Hoover hoov at freenet.tlh.fl.us
Fri Jul 28 11:22:32 PDT 2000



> Kissinger denies it, so it must be true.
> >
> > Wasn't it US oil producers who initially kicked off the seventies price
> > hikes that were later blamed on the Opec Arabs?
> > James Heartfield
>
> Michael Perelman

Of course, US/western characterization of OPEC as 'Arab' has always been ideological, 2 of 5 founders - Iran, Venezuela - were/are non-Arab states.

At minimum, US oil companies did not resist OPEC. Having gained large quantities of non-oil energy sources - coal, natural gas, uranium - by late 1960s, they wanted to drive prices up across-the-board. Plus, US wanted Europeans to pay higher prices for import oil. Toward those ends, Nixon Administration waived anti-trust rules, encouraged OPEC countries to raise crude oil prices, and 'suggested' (nod, nod, wink, wink) that companies accept pricing 'concessions.'

Industry propaganda portrayed 1971 agreements providing significant increase in price of crude as indication of OPEC 'power' and oil company 'vulnerability.' In reality, companies' price increases resulted in their receiving higher per-barrel profits. Michael Hoover



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