Metaphorically speaking that is what The New York Times has done. Blamed high oil prices on those consumers in Maine who will be near bankruptcy paying their fuel bills this winter, and all the rest of us, you, me, and everyone else out there both here and abroad.
In a totally bizarre article appearing in last Friday's New York Times "Rapidly Rising Global Demand For Oil Is Provoking New Energy Crisis," it is we, the consumers of energy who are solely to blame for what the New York Times is defining as "the world headed toward its third energy shock in a generation." The producers and refiners of crude oil, the oil industry, a compliant government are all innocent as lambs in this New York Times propaganda piece that could have been written (was it?) by the PR departments of the best and brightest of the oil companies, the American Petroleum Institute, or OPEC flaks.
High price of oil? Well, let's not mention the supply side, because it could be embarrassing, especially with OPEC keeping literally millions of barrels of oil off the market in order create artificially induced inventory draw downs pushing prices ever higher. No mention of the manipulation of the commodity markets, especially the ongoing investigations by the CFTC and the congressional hearings scheduled "to examine the role of speculation in recent record oil prices" by Senator Carl Levin's permanent sub-committee on investigations.
Then the nonsense continues. We are told that oil prices are up 56 percent this year. Really? In mid-January the price of crude touched $49.90 a barrel. The march to the recent $98/barrel brings the increase to nearly 100 percent in less than a year's time, an incredible jump for such a core commodity. But then the article goes on to inform us incorrectly hat the price of crude oil has jumped 365 percent in the last decade. Wrong again! The price of oil some 10 years ago was under $11 a barrel (yes, let me spell it out, that's eleven!) which comes to an increase this past decade not of 365 percent, but over 900 percent!! Perhaps they have no calculators at the New York Times, only dictionaries.
And while oil was marching to these stratospheric levels, the article makes no mention of the International Energy Agencies recent biting condemnation of the ongoing manipulation of the supply side of the oil price equation. Referring to the oil exporters from OPEC to Russia, "It is clear, the greater the increase in the call of oil and gas the more likely it will be that they will seek a higher rent from their exports and to impose higher prices by deferring investment and constraining production".
To back up its argumentation the article quotes extensively the wizened observations of the Energy Policy Research Foundation of Washington, an organization largely funded by the oil industry and always at the ready to give malleable reporters sound bites (as in "This is the world's first demand-led oil shock") supportive of the oil patch pitch. So much for objective reporting.
But that's not all. Not to be outdone the article introduces two observations that have become the hackneyed saws of the oil industry and their comrades in arms.
First, feeling our pain the article assuages us by informing us that the price of oil has not yet reached the inflation adjusted peak touched during the Iranian Revolution in 1980 of $101.70/bbl. Hey up there in Maine, everyone feel better now? This point of reference has become a staple of New York Times reporting on oil prices. That the argumentation is ludicrous is clear when one compares the price of oil to that other bellwether of economic activity and inflation, namely gold. At he same time, 1980, the price of gold touched $860 an ounce. Today, the price is slightly over $800 an ounce. Were the same parameters applicable to gold, its price today it would be quoted at $2,000 an ounce. All of which simply underlines that the oil patch and their friends will propagandize anything that gives the appearance of absolution but is basically meaningless.
And then, quite unbelievably for a paper of purported seriousness the article trots out that tired line, that even at today's prices, oil is cheaper than imported bottled water. As though the economy of the nation would come to a screeching halt without access to Evian, Perrier or Pellegrino. Perhaps not known to the editors of The New York Times, but the rest of us do have access to free tap water which is supplied by our municipalities at costs to them not very different from those of ten years ago. Perhaps there is a lesson here, when it comes to pumping oil from the nation's public lands.
But wait, its not over yet. While predicting significant increases in oil demand by 2030, and in lockstep with the industry's major concern, the growth of alternative fuels, the article has ominous words of warning. To each of us, to policy makers, to investors thinking of making commitments to solar power, wind power, bio-fuels, thermal power, hydro power, tidal power, nuclear power, coal conversion, flex fuel vehicles, electric powered cars, rail and mass transportation investment the message is stop, stop, stop! The New York Times is telling us by innuendo, don't you understand the danger, and the risk to the investments you are making? The article continues, "Economic slowdowns in China and the United States...would probably send prices tumbling...it happened a mere decade ago after the Asian financial crisis ... global oil prices fell to $10." So now that you understand the risk, put those plans away, because if you don't the oil industry may not reach that wondrous state of nirvana predicted for them by 2030.
The Gray Lady should be ashamed of herself, or at the very least help pay for the fuel bills in Maine this winter.
Raymond J. Learsy is the author of the updated version, "Over a Barrel: Breaking Oil's Grip On Our Future."