Tradescanthia Posted July 16, 2012 Share Posted July 16, 2012 The price of oil was driven down by the USA in the mid to late Eighties in order to destroy the economy of the USSR and it worked. The USA asked or applied pressure on Saudi Arabia to increase oil production to drive down the price of oil. It ended up at $6 a barrel, current prices are $100 - $120 a barrel. At the same time the US had increased the pace (and expense) of the nuclear arms race with the introduction of cruise missiles in Europe. The USSR's main source of income was oil and with no money coming in because the oil price had collapsed they couldn't keep up in the arms race and their economy collapsed. So ended the USSR. I also lost my job at the same time as I work in oil drilling and at $6 a barrel there was no work for anyone as all new drilling dried up. Good post, simple and informative. Link to comment Share on other sites More sharing options...
grafikhaus74 Posted July 16, 2012 Share Posted July 16, 2012 Markets are fine. Of course we need them. Financialised markets are ok too for certain commodities. Yes, of course we do. But a market is different to a cartel and these have been going for years. Supermarkets do it. Petrol companies do it. And now we have proof that banks do it. If any of these industries tried to buck the trend by offering seriously better deals, they'd get stamped on. In the late '80s, the big construction companies colluded with each other to decide who would win major contracts. It was especially rife in the aggregates business with RMC and Denniff regualrly in trouble, but a few backhanders soon made the problem go away. Link to comment Share on other sites More sharing options...
vResistance Posted July 16, 2012 Share Posted July 16, 2012 I blame this lot- http://www.bilderbergmeetings.org/index.php Link to comment Share on other sites More sharing options...
PeteMorris Posted July 16, 2012 Share Posted July 16, 2012 I suspected that cartels and collusion and fixing prices has always gone on. Is OPEC not a certel? All of the oil producers collude with each other to drive the price of oil up or down to suit their needs of the time by limiting or increasing production accordingly. Maybe the banks have simply caught on to the fact that they can influence it too, for their own gain. But I really don't think it's anything new, or a surprise to anyone. Further, I don't actually see how you can stop it either! We have watchdogs and this committee and that committee, and maybe we could introduce a swathe of new regulation, but to a more or lesser degree it will still go on. Personally, I think it's always probably been the same, it's just now in this age of more and more information being available to anyone who wants it, it's tended to shock our sensibilities, and our previously held beliefs of fair play and doing the right thing. I'm not saying I agree with any of it, as I don't. But I suspect it's how it's always been! Link to comment Share on other sites More sharing options...
Obelix Posted July 16, 2012 Share Posted July 16, 2012 The way to stop a cartel is to tax the product excessivly to reduce demand. However that has other unfortunate consequences of course. Link to comment Share on other sites More sharing options...
PeteMorris Posted July 16, 2012 Share Posted July 16, 2012 The way to stop a cartel is to tax the product excessivly to reduce demand. However that has other unfortunate consequences of course. Like the UK tax which according to the news this morning is 90%.....No I call that greed on behalf of the government. Link to comment Share on other sites More sharing options...
Riannon Posted July 16, 2012 Share Posted July 16, 2012 There was once a company named Essex Petroleum............... Link to comment Share on other sites More sharing options...
I1L2T3 Posted July 16, 2012 Author Share Posted July 16, 2012 And state control and regulation of the grain markets meant that the USSR and China never ever had shortfalls of grain or rice now did it... It's hardly relevant to this thread. Nobody is saying we don't need markets. Link to comment Share on other sites More sharing options...
Obelix Posted July 16, 2012 Share Posted July 16, 2012 It's hardly relevant to this thread. Nobody is saying we don't need markets. It's entirely relevant to this thread - I'm sorry if you cannot see the obvious conclusion to be drawn here... Link to comment Share on other sites More sharing options...
Obelix Posted July 16, 2012 Share Posted July 16, 2012 Like the UK tax which according to the news this morning is 90%.....No I call that greed on behalf of the government. That's a duty levied on all hydrocarbons though - it's nto a specific tax on the cartel's output. A cartel is broken by taxing just the product from that cartel, making the same commodity outside that cartel cheaper and thus upsetting that cartel. Link to comment Share on other sites More sharing options...
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