Speculators, Cartels & Myths of Scarcity

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April 3, 2011 — Dean Henderson

Last week, as if to justify his Libyan crusade, President Obama echoed the prevailing “peak oil” myth, stating that “we must accept the new reality that from here on out, demand for oil will always exceed supply”. It was music to the ears of the Rockefeller/Rothschild energy cartel and tax-dodger oil traders in Zug, Switzerland alike. Both know full well that oil companies pay around $18/barrel to get crude out of the ground.

Big Oil rings up its usual quarterly record profit, speculators led by Goldman Sachs and Morgan Stanley tack on another $50/barrel and people get gouged at the gas pump. Governments “tighten their belts”, economies contract and the myth of scarcity (root word: scare) encourages a race to the bottom for the global masses, alongside an historical concentration of power and wealth by the well-fed and fueled global elite.

A day after Obama’s endorsement of concentrated corporate power and casino capitalism, the US Department of Energy reported that the main US oil storage depot at Cushing, Oklahoma was holding 41.9 million barrels of crude oil, very near its capacity of 44 million barrels. In other words, the US is awash in crude oil.

Here in South Dakota, the USDA announced that farmers plan to plant an additional 850,000 acres of corn- the most since 1931. According to a March 10 bulletin from USDA, Brazil’s corn crop is 2 million tons higher than last year. Yet corn futures on the Chicago Mercantile Exchange trade at record prices.

According to the same USDA report, “U.S. wheat ending stocks for 2010/11 are projected higher this month on reduced export prospects. Projected exports are lowered 25 million bushels with increased world supplies of high quality wheat, particularly in Australia, and a slower-than-expected pace of U.S. shipments heading into the final quarter of the wheat marketing year.” Yet wheat futures hover near record highs.

There is nothing alarming in the report about supplies of beef, poultry, eggs, milk, sugar or rice either. Yet food prices continue to skyrocket.

The global elite know that both food and energy are paramount to life. Control over these two most basic needs means control over people.

After the 2008 acquisitions of Swift, Smithfield and National Beef Packers by Brazilian meat-packer JBS, there are three conglomerates that control over 80% of beef-packing in the US – Tyson, Cargill and JBS. These same companies control most of the burgeoning cattle feedlot industry centered in SW Kansas and SE Colorado. They also dominate the pork, chicken and turkey industries. Cargill is the largest grain processor on the planet, handling a full one-half of global grain supplies.

Four giant companies are making a play to own not just all the oil, but virtually all energy sources on the planet. In my book, Big Oil & Their Bankers…I dub them the Four Horsemen – Royal Dutch/Shell, Exxon Mobil, Chevron Texaco and BP Amoco.

These companies control crude oil from the Saudi well-head to the American gas pump and profit from every step of processing, shipping and marketing in between. While reactionary Republicans blame environmentalists for the lack of US oil production, it was these oil giants who capped permitted wells in Texas and Louisiana and moved production to the Middle East – where Bangladeshi, Filipino and Yemeni workers are paid $1/day to work the oil rigs.

Royal Dutch/Shell and Exxon Mobil are the heaviest and most vertically integrated of the Four Horsemen. These behemoths have led the charge towards horizontal integration within the energy industry, investing heavily in natural gas, coal and uranium resources.

With the fall of the Berlin Wall, Eastern Europe, Russia, the Balkans and Central Asia were opened to Big Oil. According to Kurt Wulff of oil investment firm McDep Associates, the Four Horsemen, romping in their new Far East pastures, saw asset increases from 1988-94 as follows: Exxon Mobil-54%, Chevron Texaco-74%, Royal Dutch/Shell-52% and BP Amoco-54%. The Rockefeller/Rothschild Oil Cartel had more than doubled its collective assets in six short years.

Russia and Central Asia contain over half of the world’s natural gas reserves. Royal Dutch/Shell has led the way in tapping these reserves, forming a joint venture with Uganskneftegasin at a huge Siberia gas field in which Shell owns a 24.5% stake. Shell has been the world’s #1 producer of natural gas since 1985, often via a joint venture with Exxon Mobil.

In the US retail natural gas sector Chevron Texaco owns Dynegy, while Exxon Mobil owns Duke Energy. Both were key players – alongside Enron – in the 2000 natural gas spikes that battered the economy of California and led to the bankruptcy of that state’s main utility provider, Pacific Gas & Electric. Exxon Mobil has extensive interests in power generation facilities around the world including full ownership of Hong Kong-based China Light & Power.

During the 1970s Big Oil invested $2.4 billion in uranium exploration. They now control over half the world’s uranium reserves, key to fueling nuclear power plants. Chevron Texaco and Shell even developed a joint venture to build nuclear reactors.

Exxon Mobil is the leading coal producer in the US and has the second largest coal reserves after Burlington Resources, the former BN railroad subsidiary which in 2005 was bought by the DuPont family-controlled Conoco Phillips. Royal Dutch/Shell owns coal mines in Wyoming through its ENCOAL subsidiary and in West Virginia through Evergreen Mining. Chevron Texaco owns Pittsburgh & Midway Coal Mining.

Seven of the top fifteen coal producers in the US are oil companies, while 80% of US oil reserves are controlled by the nine biggest companies. Both Royal Dutch/Shell and Exxon Mobil are hastily buying up more coal reserves.

Concentration of power across the energy spectrum is not limited to the US. In Columbia, Exxon Mobil owns huge coal mines, BP Amoco owns vast oilfields and Big Oil controls all of the country’s vast non-renewable resources. In 1990 Exxon Mobil imported 16% of its US-bound crude from Columbia.

The Four Horsemen have invested heavily in other mining ventures as well. Shell holds long term contracts with several governments to supply tin through its Billiton subsidiary, which has mines in places like Brazil and Indonesia, where it is that country’s largest gold producer. Billiton merged with Australia’s Broken Hill Properties to become the world’s biggest mining conglomerate – BHP Billiton.

Shell also enjoys cozy relations with the world’s 2nd largest mining firm – Rio Tinto – through historically interlocked directorates. Holland’s Queen Juliana and Lord Victor Rothschild are the two largest shareholders of Royal Dutch/Shell.

Shell recently began investing heavily in the aluminum industry. Shell Canada is Canada’s top sulphur producer. Shell controls timber interests in Chile, New Zealand, Congo and Uruguay and a vast flower industry with farms in Chile, Mauritius, Tunisia and Zimbabwe.

Recently, Shell’s BHP Billiton tentacle announced a $38.6 billion hostile takeover attempt of Canada’s Potash Corp. BHP Billiton already owns Anglo Potash and Athabasca Potash. Ownership of Potash Corp. would give them control over 30% of the global potash market. Potash is a necessary component in growing any agricultural crop.

BP Amoco, through its ARCO subsidiary, has become one of the world’s top six producers of bauxite, from which aluminum is derived. It has mines in Jamaica and other Caribbean nations.

Chevron Texaco controls over 20% of the huge AMAX mining group, the leading producer of tungsten in the US with extensive holdings in South Africa and Australia.

Exxon Mobil owns Superior Oil and Falconbridge Mining, Canada’s largest producers of platinum and nickel, respectively. Exxon also owns Hecla Mining, one of the world’s top copper and silver producers, and Carter Mining, one of the top five phosphate producers in the world, with mines in Morocco and Florida. Phosphates are needed to process uranium, while phosphoric acid is key to petrochemical production, which the Four Horsemen also control.

Another vehicle for Four Horsemen hegemony in the energy sector is the joint venture. For decades before Chevron merged with Texaco in 2001, the companies had marketed petroleum products in 58 countries under the Caltex brand. They also operated Amoseas and Topco as joint ventures before merging.

Caltex owns refineries in South Africa, Bahrain and Japan. In the Philippines, Caltex and Shell control 58% of the oil sector. When Philippine strongman Ferdinand Marcos introduced martial law in 1972, Caltex Vice President Frank Zingaro commented, “Martial law has significantly improved the business climate.”

Exxon and Mobil also shared many joint ventures around the world prior to their 1999 merger, including PT Stanvav Indonesia. Royal Dutch/Shell and Exxon Mobil established a North Sea joint venture called Shell Expro in 1964, while in 1972 Shell tied up with Mitsubishi in Brunei to supply oil to Japan.

Shell owns 34% of Petroleum Development Oman in partnership with Exxon Mobil. Saudi ARAMCO, the Iranian Consortium, Iraqi Petroleum Company, Kuwait Oil Company and the ADCO in the United Arab Emirates all represent(ed) Four Horsemen collusion.

In Iran, Iraq and Libya these cartels were nationalized. That’s why the Rockefeller/Rothschild Oil Cartel billed US taxpayers to invade Iraq and Libya, while continuing to threaten Iran. The first oil contract in Iraq went to Royal Dutch/Shell. The 2nd goes to BP and the 3rd to Exxon Mobil. You get the picture.

Both food and energy are paramount to life. That’s why Congress should shut down speculator casinos like the Chicago Mercantile Exchange and the NYMEX, while nationalizing the Four Horsemen and the monopoly food processors. We should form a US Energy Company and a US Food Processing Company which would focus on renewable energy and a healthier diversified diet, respectively.

All things are possible if we show political will and are not scared. We should reject “peak oil” and its attenant myth of food scarcity and tackle the real problems – concentration of corporate power and speculation.

http://deanhenderson.wordpress.com/2011/04/03/speculators-cartels-myths-of-scarcity/#more-1084

11 Responses to “Speculators, Cartels & Myths of Scarcity”

Steven Says: April 3, 2011 at 5:18 pm
Oil is not scarce at this present time ( if you can afford it ) “but” oil and natural gas are both finite resources. Oil fields do become depleted, the first and second laws of thermodynamics have yet to be disproven. Why go after hard to get oil miles below the bottom of the ocean and use tremendous amounts of fresh water and gas to produce oil from tar sands if you know where there is easy to access oil?

Dean Henderson Says: April 3, 2011 at 6:22 pm
All good points Steven, which is why we need to nationalize Big Oil and focus on renewables big time…

concarlitosblog Says: April 3, 2011 at 9:57 pm
but doesn’t steven’s point prove an inevitable, somewhat imminent (?) scarcity.
do you believe synthetic fuels are equal substitutes for crude, or where does the myth of scarcity begin?
it seems like if peak oil were a myth, we wouldn’t be making, or attempting, a transition to syn fuels.
furthermore, i thought – although i haven’t read your book but now will – that the big seven lost most of their power with the nasser nationalization movements… don’t national oil companies hold the substantial amount of market share of oil production, and aren’t almost all of IOC’s investments joint ventures they generally bid for? – not including the nepotistic bids in iraq, and elsewhere.
good post, i’m just curious about conclusions that differ from the ones i have reached… 🙂

Dean Henderson Says: April 3, 2011 at 10:22 pm
As I stated in the article, most decisions made by Big Oil come down to profit motives. A high oil price does indeed allow for tar sands and deepwater exploration, but does this indicate scarcity or a desire to hold sway over all potential non-renewables by this cartel? I bought into peak oil for quite awhile, but became skeptical when it became apparent that many of it’s “scientific” proponents were “ex” oil industry people (Matthew Simmons being the loudest). I am all about conservation and do see a planetary climatic/pollution crisis as a direct result of oil addiction. I don’t even own a car right now and spent two decades growing my own food and living off the land. Like any resource, we should conserve it, and yes it has its limits, but I now see peak oil as a sort of hysteria that paralyizes opposition to the real crisis, which is one of unprecedented concentration of power over ALL resoures by a handful of global corporations, who benefit from “myths of scarcity”.
Your point on nationalizations is well-taken. Indeed Nasser (and Gaddafi, among others) did inspire these. However, in many cases, the Four Horsemen (Anthony Sampson’s Seven Sisters since Chevron bought Gulf and merged with Texaco, while Exxon bought Mobil) have cut sweetheart deals with these companies and in some cases denationalization has occurred. You should read my book, as you obviously have some background in this area and would, I think, find it interesting. Thanks for your well-informed comments!

srandall Says: April 4, 2011 at 8:53 pm
good work brother catch up later

Dean Henderson Says: April 4, 2011 at 8:59 pm
Gracias hermano. Let’s do that for sure…

another Says: April 5, 2011 at 11:54 am
Bravo! Bravo!!!
Ole!
Magnificent! I just found this blog and its fearless author.
Thank you very much for clinching the rest of the big bankster picture.
Can you believe they’re also the ones who created the black market aka the war on drugs and are and have been for decades the biggest drug dealers (using the CIA as cover)? It’s true! The CIA founded the Medellin Cartel and Bush was partners with Pablo Escobar and Noriega! That’s just one example.
Hang the banksters! Get the lurking joooo with the $100 trillion fortune they made creating and financing wars.

srandall Says: April 6, 2011 at 9:16 pm
one voice of truth old friend hard to believe the Lie could get so big…

dee jay Says: April 22, 2011 at 1:34 pm
Dean,
Finally someone who got it right. Here in town we have
a city led “peak oil” task force. What a joke! The local
liberals have swallowed whole the fishy tale.
Have you seen the leaked memos of the four horseman
about containing production and refining capacity.
They are doing the same thing that the deBeers Group did to
diamonds. Diamonds are really a trinket and very plentiful.
Hmm…what to do? Oh, create an artificial scarcity and have
Marilyn Monroe promote diamonds. Reult: $$$$$ for deBeers.
What aren’t you on 60 minutes and some talk shows?
Better yet, let’s do a film documentary like Food, Inc. or
Supersize Me. Really. I am a filmmaker.

nate Says: April 22, 2011 at 5:24 pm
why doesnt the government just get there head out of there ass an start growing industrial hemp we would never run out of energy it would help the environment we wouldnt have to ruin beautiful forests for paper we would have good medicans an be more healthy we would have all our reusable recources an energy right here at home everything we would ever need dont listen to the lies an propaganda the government is feeding our society an our children of the future they dont care about the people they call this the land of the free but in all reality we are just prisoners of modern day slavery our human rights an amendment dont apply to us all it is is a front… i geuss money is the root of all evil

horse Says: May 12, 2011 at 7:26 pm
…because we are under the sway of psychopaths.

About the author:
Dean Henderson was born in Faulkton, South Dakota. He earned an M.S. in Environmental Studies from the University of Montana, where he edited The Missoula Paper and was a columnist for the Montana Kaimin. His articles have appeared in Multinational Monitor, In These Times, Paranoia and several other magazines.

A life long political activist and traveler to fifty countries, Henderson co-founded of the University of Montana Green Party and the Ozark Heritage Region Peace and Justice Network. He is former Vice-President of the Central Ozarks Farmer’s Union and former President of the Howell County Democrats.

In 2004 he won the Democratic nomination for Congress in Missouri’s 8th District.

Dean’s Books Available in print and e-book formats:

Big Oil & Their Bankers in the Persian Gulf…
https://www.createspace.com/3476183
http://www.smashwords.com/profile/view/DeanHenderson

The Grateful Unrich: Revolution in 50 Countries
www.createspace.com/3477016
www.smashwords.com/profile/view/DeanHenderson

Dean Henderson is the author of Big Oil & Their Bankers in the Persian Gulf: Four Horsemen, Eight Families & Their Global Intelligence, Narcotics & Terror Network and The Grateful Unrich: Revolution in 50 Countries.

His Left Hook blog is at http://deanhenderson.wordpress.com/category/left-hook-columns/
Dean Henderson is a frequent contributor to Global Research. Global Research Articles by Dean Henderson: http://www.globalresearch.ca/index.php?context=listByAuthor&authorFirst=Dean&authorName=Henderson