Bush’s war pumps up gas prices and oil company profits

Workers across the United States took a big wage cut this week. It came at the gas pump, where prices rose to $2.61 a gallon.

Experts predict they will soon hit $3. A barrel of crude oil sold for $67 on the International Petroleum Exchange.

Wal-Mart Corporation, the second-richest U.S. corporation, reported a drop in sales and profits, because “our customers, most of whom are low-income,” had less to spend. They had to fork over more of their paychecks to ExxonMobil, the richest U.S. corporation. Wal-Mart did not, of course, raise the wages of its notoriously low-paid workers to help them cope with the hikes. The workers will need a union to win that.

Northwest Airlines wants to pay its fuel bill with what it saves by reducing the pensions and benefits of its mechanics, cleaners and baggage handlers. As a result, the workers are now on strike, and the company is using scab labor.

Oil prices don’t only hit workers at the pump. They show up in rent and utility bills, the price of food, medicine, and anything made with plastic or carried by truck, train, ship or plane. High oil prices also push up the price of other energy sources, like coal and natural gas.

Many people will suffer and even die this winter because they can’t pay for heating oil.

The price hikes have hit even harder outside the U.S. The European Union says the high oil prices are slowing its economy. In Africa, Asia, Latin America and the Carib bean, the effects are even more painful. Poor countries spend a huge chunk of their income on oil. High oil prices mean less money for food; they can mean hunger. Dozens died in Yemen last month in protests against rising fuel costs.

Iraq once traded oil to African countries on a barter basis. Occupied Iraq can’t do that anymore.

The price of gas was top news this week in the corporate-owned media. But the media didn’t mention a big cause of the increase: the U.S. wars against Iraq and Afghanistan, combined with the Bush regime’s war threats against oil-rich Iran and Venezuela, and Washington’s sanctions against Sudan.

The media don’t talk about how much oil the war consumes: an Abrams battle tank uses six gallons per mile. Commenta tors instead complain that China “buys too much oil.” China once had contracts to buy oil from Iraq, but it now has to buy more from U.S. monopolies at exorbitant prices. The Chinese tried to break that stranglehold by buying Unocal, another oil giant, but U.S. courts didn’t allow it and Unocal went to Chevron.

Many who oppose the war and some who support it think the U.S. invaded Iraq to bring down the price of oil. But the Bush regime is a creature of the oil monopolies. These giants are not in business to supply energy. They’re in business to make a profit, the highest return on their invested capital.

An oil shortage is not the biggest fear of oil executives. They fear a glut—too much oil on the market, pushing down prices, profits and the value of their capital. The history of the oil industry is a history of rigging prices by restricting supply. That’s what monopoly is all about.

John D. Rockefeller created the original Standard Oil monopoly back in the late 1800s. He did it by gaining control of pipeline routes in Pennsylvania and Ohio and crushing small producers. To do this, Rockefeller agents bombed competitors’ refineries. These attacks were called the Pennsylvania Oil Wars.

The U.S. war against Iraq has killed a lot more people than the Pennsylvania Oil Wars. But it serves the same interests. The war crushed Iraq’s state-owned oil industry - which owned 11 percent of the world’s known oil reserves and was independent of the U.S. oil monopolies. The war also pumped up profits at ExxonMobil, ChevronTexaco and British Petroleum, who got a stronger grip on the world oil supply. The three biggest oil firms are descended from Standard Oil, and the Rockefellers have major interests in all of them. They made a combined profit of nearly $30 billion in the first six months of this year.

Bankers are also getting richer. They rake it in from oil-future speculation and debt payments from oil-producing countries.

High prices bring little benefit to poor oil-exporting countries, like Mexico, Ecuador, Nigeria and Indonesia. These countries must use most of the oil income to pay interest on loans to western banks. The higher the price of oil, the better the bankers’long-term credit ratings.

Banker-run hedge funds now control at least 10 percent of the world’s oil supply. The Rockefeller-controlled Citigroup is the world’s largest financier of energy projects. Its second-quarter profit quadrupled this year to $5.7 billion. JPMorgan Chase, a merger of the Rockefeller and Morgan dynasties, manages Saudi Arabia’s overseas investments. Now, thanks to the U.S. occupation, it controls Iraq’s oil revenues, as a virtual colonial administrator of Iraq’s Bank of Trade.

To the bankers and oil magnates, the lives of Iraqi people and U.S. GIs don’t count for much when profits like that are involved. Nor do the hardships of workers who must choose between heating and eating. The White House and Pentagon are not planning to leave Iraq any time soon. They’re plotting instead to expand their war to Iran and Syria. They won’t stop unless a worldwide popular movement stops them.