Over the long Easter weekend, I wanted to share a few excerpts from my financial history book, Panic, Progress, and Prosperity. Here’s today’s piece:
No other commodity in the modern age has affected the world stage as much as oil. As a basis for any modern economy, crude oil is second only to water as the liquid perceived as vital to life, and the global political stage – particularly since 1970 – has been largely shaped by the price movement of oil in the financial markets. No wars have been fought over corn, pork bellies, or gold. In modern rhetoric, oil has been made the figurative equal of blood.
The popular perception of OPEC is that it is an all-powerful cartel of Middle Eastern countries that has unilaterally set the worldwide price of crude oil to maximize profits, to the chagrin of industrialized Western countries beholden to its decisions. The truth is far afield from this set of common assumptions.
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