>Suppose the entire Middle East had been governed by
>populist-secularist-pan-Arabist governments that could get together
>& assert
What if? They'd have to sell the oil. Too high a price causes recession, promotes exploration, and encourages substitutes. And there are plenty of non-Arab and non-OPEC oil producers who'd be happy to step in and undercut them. The cost of production for Persian Gulf oil is $5 a barrel, or something in that range; unlike other basic commodities, you can't say the price is unfairly low.
A more interesting difference might be what populist-secularist-pan-Arabist governments could do with the money other than buying securities in London and New York. If they used the proceeds to finance real development and social welfare programs, Uncle Sam would have to scramble harder to sell T-bonds.
Doug