Petrol prices have been rising steeply for many years now. US author Les Leopold of “The looting of America: How Wall Streets Game of Fantasy Finance Destroyed Our Jobs, Pensions and Prosperity and What We Can Do About It” wrote an article a few days ago titled How Wall Street Drives Up Gas Prices, in which he state that for every penny/cent increase at the pump, $1.4 billion per year leaves our collective pockets, creating a drag on the sluggish recovery. Where does it go and what caused the price explosion at the pump?
He further informs us that it is a common belief that oil prices are set on the world market by supply and demand; less supply and/or more demand causes prices to rise. There is a belief that oil is getting harder to find; OPEC is holding back supply; China and India are guzzling it up; Iran is threatening to blow it up. And regulations are getting in the way of drill etc.
Leopold continues, “but this fixation on blind market forces ignores the fact that Wall Street is financialising the commodities markets, especially oil as it seeks new ways to pick our pockets. The same greedy swindlers who puffed up the housing bubble and then milked it dry are now hard at work doing the same with gasoline”.