Today's high oil price is the norm - political expert
In the wake of the soaring gasoline costs that have threatened to top 2008's record high, the US has announced a probe into oil price fraud and speculation.
“There’s some indication that speculation played a role, but it’s not clear what it really means. People are purchasing oil futures because they think that the prices are going to go up”, says Naiman.
“If they are powerful enough, they can play the market, but if they have a rational belief that oil will be more expensive in the future, then that’s not manipulation – that’s a normal functioning of the market “ he adds.
“The prices that we saw in 2008 are the norm and what we are seeing today are the norm” argues Naiman.
“It’s the fall in between that was abnormal – it was the economic crisis and that always causes the oil prices to fall as a result of the fall in demand”
Robert Naiman agrees with most Americans who blame the situation in the Middle East for the high prices.
“Many people believe that US policy in the region is motivated by the desire for low oil prices”, he says.
“But if that were true then US policy in Libya, for example, wouldn’t make any sense whatsoever, at least for the short run. US, British and French policy has contributed to the run in oil prices by exacerbating the civil war and the crisis. If that were the concern, then the US policy would end in exactly the wrong direction.”
As the Obama administration prepares to investigate claims of oil price manipulation by investment bankers, questions remain about the war's impact on energy costs.
Sara Flounders, from the International Action Center, claims the US government is not only interested in controlling the cost of oil, but is able to do so.
“This investigation is just because of the pressure. People are furious at the rise of oil and gas prices, but the entire market of the resource is completely corrupt and manipulated,” she said, adding that “while the American military is securing the oil reserves in Iraq and Libya for US corporations, the government sanctions unprecedented cuts of the social programmes back home.”