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Commentary Last Updated: Jun 25th, 2008 - 00:48:17

Brown�s chutzpah pays off
By Linda S. Heard
Online Journal Contributing Writer

Jun 25, 2008, 00:11

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British Prime Minister Gordon Brown may be increasingly bereft of public support but he�s certainly got chutzpah.

With rocketing UK inflation and Britons pinched by the credit squeeze triggered by the subprime crisis, ever-rising fuel prices represent the last straw for ordinary people struggling to maintain a decent standard of living. Faced with a barrage of strikes and public unrest, Brown flew, cap-in-hand, to see his friends in Saudi Arabia with a four-letter plea -- �Help!� And they did. Saudi Arabia called an emergency meeting of oil producing countries and exporters and showed good will by promising to increase its daily production by 200,000 barrels next month, as well as invest in refineries. It has also pledged $1 billion to help ease the pain of developing nations and a further $500 billion in loans to fund energy projects in some of the world�s poorest countries.

Other producing nations were less forthcoming, partly because they disagree over the underlying reasons forcing prices up.

OPEC�s President Chakib Khelil says he believes the upward shift is fueled by speculators and the weak dollar. And despite his willingness to help out, King Abdullah made it clear he also thinks speculation is a major factor along with rising fuel taxes.

Gordon Brown says he believes increased demand from China and India is the cause and increasing output is the magic bullet but he�s already been proved wrong. Less than 24-hours after the oil summit, prices are hovering upward of $136 a barrel due to attacks on Royal Dutch Shell and Chevron Corp. facilities in Nigeria and the evacuation of two North Sea platforms. And some analysts predict it will reach $140 later in the week.

The fact is Brown prefers to ignore geopolitical factors impacting oil markets because instead of traveling to Jeddah, he would have to fly to Washington and Tel Aviv to persuade those officials saber rattling against Iran to tone down the rhetoric after first muting his own. Indeed, every time a senior figure in the US or Israeli government indicates a willingness -- occasionally even an eagerness -- to bomb Iran�s nuclear facilities, oil jumps higher in response.

For instance, a few weeks ago, when Israeli Transport Minister and Deputy Prime Minister Shaul Mofaz said, �Attacking Iran, in order to stop its nuclear plans, will be unavoidable,� oil rose by $11 per barrel in a single day!! When Israel appeared to mount a dry run in the eastern Mediterranean earlier this month and Iran responded with warnings of devastation, the markets were thrown into further turmoil.

�Supply and demand� is just a convenient fall guy for Brown, who, if he seriously wanted to alleviate the burden on the British public could reduce what are arguably the most crippling taxes on petrol in the world. Currently, Britain imposes a fuel duty plus VAT (value added tax) that adds 80 percent to charges at the pump. So when Britons groan as they pay their already heavily taxed earnings over to fill their tanks, 80 percent finds its way to government coffers. We should remember, too, that Britain is an oil-producing country itself but little of that bounty shows up in public pockets.

So here�s a man who, among others, is personally responsible for Britain�s military forays that have created such instability in the Middle East and who is directly responsible for the pernicious level of fuel tax levied on the British taxpayer. And yet, he believes it�s all the fault of producers that refuse to open the taps to their full capacity every time British truck drivers or fishermen threaten to go on strike. Or rather, that�s what he says. It also appears to have escaped Brown that for a person who champions a free market economy asking producers to manipulate markets with increased production goes against the fundamental philosophy.

But his cheek didn�t end there. Not only does Brown want OPEC members to pump as though there is no tomorrow, thus diminishing their precious resource, he wants them to invest in his plans to make Britain less oil-dependent. Yes, he wants oil producers to pour their profits into Britain�s new wind, solar and nuclear power stations. That suggestion, understandably, received only polite interest from Dubai and Qatar. He is basically asking producers to cut their own throats, at least in the long run. The next time he comes calling crying crocodile tears over his nation�s poor and asking for favors, OPEC members would be advised to ply him with Turkish coffee, pat him on the head now and again, and send him off with nothing but platitudes.

Linda S. Heard is a British specialist writer on Middle East affairs. She welcomes feedback and can be contacted by email at

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