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I just read that there is good reason to believe record high oil prices may be due to our own strategic oil reserve, which the Bush administration may have been manipulating to drive up prices for the benefit of its clients. This is something Congress must investigate since there is plenty of preliminary evidence far too lengthy to go into in this letter. This manipulation goes far beyond corruption and is close to economic treason, because when oil prices increase America must pay more for its imported oil. That, in turn, increases the trade deficit and our foreign debt. Alternatively, one can think of price manipulation as the equivalent of a tax increase on American families that is paid to foreign governments, including Iran. While some small energy scandals are under investigation by Congress, the biggest is the strategic oil reserve, which may have been “strategically” manipulated to drive up oil prices. The key to understanding this manipulation is demand and supply and oil storage capacity. The market has been manipulated, involving Wall Street commodity speculation and the strategic reserve’s oil storage. The reason oil prices have been falling lately is that the market has finally run out of storage capacity, meaning oil produced must now be immediately sold. This indicates there has never been a supply shortage and if the administration hadn’t manipulated it like they did, oil prices might not have risen as they did. Now the administration is saying it’s going to double the size of strategic oil reserve from 700 million barrels to 1.5 billion barrels and will purchase 100,000 barrels of oil per day. Of course, the price of oil will jump again. Not only will there be an increase in oil, but they will also provide new storage capacity to re-corner the market. Congress must investigate this strategic oil reserve, how it has been managed and what its purpose is. The recently announced expansion serves no real national security function and will only drive up oil prices and add to the budget deficit and national debt. A recent IMF study reported that oil prices in the U.S. seem to be politically manipulated, falling prior to 2002, 2004 and 2006 elections.

Sharlene White
Colorado Springs

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