Karl Rove Group That Absurdly Blames Obama For Rising Gas Prices Was Bankrolled By Top Oil Speculator

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"Karl Rove Group That Absurdly Blames Obama For Rising Gas Prices Was Bankrolled By Top Oil Speculator"

Paul Singer

A conservative political advocacy group attacking Obama for supposedly raising gas prices received a “seven-figure check” from a leading Wall Street oil speculator.

While conservative organizations — and even Murdoch’s Wall Street Journal — agree that presidents have no control over gas prices, excessive oil speculation has been blamed by economists for 15% of the increase in the price of crude oil over the last decade.

Crossroads GPS, a political organization run by strategist Karl Rove, has spent $1.7 million on a new national ad campaign blaming President Obama for making gasoline cost “too much.” But the organization has in the past received substantial funding from Paul Singer, manager of a hedge fund responsible for some of the highest volume of oil trading in the country.

Former ThinkProgress blogger Lee Fang at the Republic Report reported on the link:

I received a leaked document from the CFTC — the regulatory body that is set up to monitor commodity speculation — revealing the one day oil trading information from 2008. This list of speculators … shows that Elliott Management is among the top financial firms with the highest volume of trades in the country, up there with Goldman Sachs and Credit Suisse. Currently, most oil speculation is conducted on private exchanges and through investment banks, so the public left in the dark about who is trading the world’s oil supply. The document shows Singer’s firm with bets on over 50 million barrels of oil that particular day.

A blockbuster Wall Street Journal story in 2006 revealed that Singer’s firm was among several hedge funds that paid lobbyists to gain political intelligence on an asbestos bill working its way through Congress — with the hope of using inside information to profit off of asbestos-related companies. But what makes Singer interesting in the context of this latest attack ad is how his business interests conflict with the message about Obama causing high gas prices.

As a Super PAC, details of Crossroads’ donors is confidential. But Peter Stone of the Center for Public Integrity was able to get an inside look at leading GOP political operations in 2010, reporting that Singer had written a check to Crossroads for more than a million dollars to fund attack ads.

The New York Times recently profiled top GOP funders, calling Singer “among the most-sought-after Republican donors in the country.” He has also funded campaigns to tear down the 99% movement.

With the support of wealthy donors like Singer, conservative groups have undertaken an aggressive campaign to undermine Obama’s energy policies, claiming that he has limited oil production and driven up the price of gasoline.

However, oil production is at its highest level since 2003.

And multiple analyses, including the most recent from the Associated Press, show zero correlation between increased domestic drilling and the price of gasoline over the last 30 years:

That’s because oil is a global commodity and U.S. production has only a tiny influence on supply. Factors far beyond the control of a nation or a president dictate the price of gasoline.

“Is President Obama responsible for spiraling price of gasoline? Republicans say yes, but the facts say no,” wrote Cato scholars in a recent analysis.

So what’s driving up prices? Global supply and demand is one.

Another factor experts are warning about is excessive speculation. Today, brokers betting on the price of oil — firms like Singer’s Elliot Management —  represent about 70% of all crude purchases.

Michael Greenberger, a former regulator at the Commodity Futures Trading Commission (CFTC), recently called excessive speculation “a fancy word for saying that gamblers wearing Wall Street suits have taken these markets over.”

Bart Chilton, a current commissioner with the CFTC, said he believes Wall Street speculators are adding several hundred dollars to the gasoline budget of Americans each year.

Not only are the ads claiming Obama is driving up the price of gasoline completely false, they’re potentially being funded by people who actually do have a role to play in increasing prices at the pump.

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19 Responses to Karl Rove Group That Absurdly Blames Obama For Rising Gas Prices Was Bankrolled By Top Oil Speculator

  1. Earl Richards says:

    Google the “Global Oil Scam.” Purchase electric cars and solar panels. The price of oil and gasoline is determined by those who control the crude oil futures markets and is not determined by Obama, OPEC and Saudi Aramco.

  2. Dorris L. Potter says:

    This is a very interesting read, now if the prices of gasoline would just go down. The gluttens are making money off the poor workeing people. Greed is NOT a solution to this mahame.

  3. Rabid Doomsayer says:

    Just blaming Obama is clearly bull, but just blaming speculation is also wrong. There is a fundamental shortage of easy to obtain oil, a shortage that is set to worsen.

    We are not drilling in 40,000 feet of water in the extremely hostile Arctic and politically unstable nations for fun, it is because the easy stuff is gone.

    It is true that right now gas would be a little bit cheaper if not for the speculators, but only a little.

  4. Ken Barrows says:

    Let’s end all speculation! If you don’t have the cash, you cannot buy it (oil, gold, stocks, silver) then you cannot have it.

    There’s only one place for speculation: cap and trade.

  5. So how is this not a conflict of interest? A company that speculates in oil pushes prices higher, then pays the lobbying group blaming Obama for high gas prices. Corruption doesn’t even begin to describe it.

    As for US oil production, we are now at 6.13 million barrels per day according to the EIA’s latest STEO report. We’ve had a revolution in fracking which, while causing all sorts of environmental damage and likely amplifying human-caused climate change, is resulting in sizable increases in US oil production. If trends hold, we might break 7 million barrel per day by or before 2015. Though claims of challenging the previous peak in US oil production in 1970 are extremely optimistic and premature, it does look like the US will see solid gains in production through this decade. And this happened under Obama, not republicans.

    But more significant than any gains in US oil production have been gains in vehicle efficiency. The boost in CAFE standards could reduce US gasoline consumption by 30% or more through 2025. In addition, if large portions of the US vehicle fleet are taken up by the, republican-demonized, Volt, then it is entirely possible the US could become a net oil exporter by the 2020s.

    Obama has applied an all hands on deck approach to US energy while trying to enact carbon reductions through the EPA. The current laws limiting emissions would result in significant scaling back of US coal use by the 2020s and this is what needs to happen for US carbon emissions to go down. Further, the president’s support for US wind, solar energy, and electric vehicles, while attempting to regulate fracking would continue to push carbon emissions down. Such a policy is both responsible to the environment and protects the US economy. Republican policies, on the other hand, counsel no prudence, only continued unconstrained consumption of dirty, dangerous and depleting fossil fuels, while wrecking the land the and climate in pursuit of these sources.

    • Mulga Mumblebrain says:

      Hang on! That’s not ‘corruption’. That’s ‘Standard Operating Procedure’ as a capitalist kakistocracy works its ‘market magic’.

    • JOYCE Acebo~Raguskus says:

      Thanks your for you ‘reality’ observations here.
      Obama is in a position of ‘transition” economic and environmental crisis….and our mending and attacking man made mistakes must not hold today w anymore bandaids..
      they must “hold to future and sustainable” and maintain a degree of balance…
      The nations thinking must shift to ‘survival’ of the Earth and those that are privileged to breath it’s not so clean air, still…If we don’t shift and look to the sun and the wind now, for “alternative” sources of energy…the sun and the wind will come to us in it’s survival, and continue to speak to us in unpredictable, predictable, weather crisis, after crisis…’climate change.’ Man, with nature, are the solutions, and time does not discriminate.
      Thank you for your comments of reason and reality Robert.

  6. Bill says:

    Why did U.S. domestic daily production decline so sharply during the Bush terms? Was that decline a purposeful attempt to affect an outcome in the international oil market? I am not big on conspiracies, but this seems odd.

    • Raul M. says:

      Storm seasons had something to do with how easy it was to prod the Gulf of Polution.
      Storminess lasted the summers and changed thing around.

  7. Jackie says:

    Karl Rove has been working hard for 3 years getting billionaires and Oil Companies to help get back the White House. The selection of candidates knew it would just be a title of President they would have along with the perks. The Government would be run by others. Karl Rove saw how well it work for Dick Cheney with Enron and Oil countries like Libya, Iran and Afghanistan. Invading Iraq for oil fields was a brillant idea by Cheney and it worked people believed every lie. Karl used the story God told Bush to be President and the faithful followed. Mitt now has the Evangelical/Catholic/Baptist churches telling the faithful to set aside religion and just vote for Mitt. Oil companies will be drilling in all areas of the US and when we see another disaster oil spill Mitt will blame you betcha President Obama. The GOP are telling Americans Obama caused the hold mess from 2001 to today, war on women, denying health care/social security and even dumping soldiers bodies in landfills. People believe the GOP would not lie because of their religious belief.

    • The Oracle says:

      Jackie, the Republican-led coup of America is humming right along, with Republican billionaires financing Republican lies and liars, a Republican-led coup that Republicans and other conservatives worked so hard for decades to bring to fruition. Hillary Clinton said it all in the early 1990s, there is a “vast right-wing conspiracy,” one financed by power mad Republican billionaires intent upon disrupting and destroying our democracy, often working in the shadows, but having right-wing front groups like right-wing think tanks providing the strategy and talking points to right-wing media outlets, like the Republican billionaire-owned Fox “News” and a slew of right-wing radio outlets, all established to literally brainwash susceptible ordinary non-wealthy American citizens into believing that the Republican billionaires and millionaires really have their best interests in mind. Yeah, right, as if these greedy Republican billionaires and millionaires stop caring only for money, and making even more, and instead help Republicans not as wealthy (or anyone else). IOW, the Republican Revolution is actually the Fools Revolution, with right-wing fools leading and right-wing fools following, and dragging the rest of America into a pit we just might not be able to crawl out of.

  8. “The New York Times recently profiled top GOP funders, calling Singer “among the most-sought-after Republican donors in the country.” He has also funded campaigns to tear down the 99% movement.”

    As the article points out so effectively, there is a very real connection between commodities speculation and the corruption of our political system.
    While I agree that the President does not control the price of oil, he does have the power to stop the speculation in the commodities futures market that has driven the price of all commodities to levels that are a detriment to the economy. The price of all major commodities have become completely divorced from their production costs and continue to rise even though there is an adequate and growing supply to satisfy the demand in the market. The President should execute the RBOB GAMBIT by using an Executive Order to force the CFTC to enforce the limits on speculation that were enacted by Congress in the Dodd-Frank Act. By using his authority as head of the executive branch he can restore hundreds of millions of dollars to the American public that is currently expropriated by excessive speculation. Read more at http://www.rbobgambit.org .

  9. Marc says:

    I think it’s time to buy that Prius C when I go car shopping next year.

  10. The Oracle says:

    What happened in 2008 PROVES that it’s the oil futures speculators (who’ve cornered 70 percent of the oil trading market) who are behind the present skyrocketing oil barrel and gasoline prices.

    In 2008, the unregulated oil futures traders drove up energy prices just through their speculative activity (not supply and demand), but when the stock market crashed, energy prices plummeted. Connection? The stock market affected all trading including that of the oil futures speculators, driving down the stock market index AND the energy prices (for a short time, and then the bail-out occurred, which bailed out Wall Street firms and the oil futures speculators, making it possible to recoup their losses and rev up again to “back to business as usual.” And their “business as usual” is making as much money as possible, which is causing energy prices to skyrocket again today.

    If the CFTC put limits (the more severe the better) on oil futures trading right now (as the stock market crash inadvertently did in 2008), then I guarantee that energy prices would go down, and maybe quite significantly, depending on how severe the limits on oil futures trading are put in place. Why not give it a try? If it’s not the oil futures speculators causing all this damage to our economy, we would know shortly if energy prices stayed fairly level. OTOH, if energy prices dropped in a month or two and fairly significantly, then we’d have all the proof needed that unrestricted run amok oil futures speculators are scamming gasoline consumers.

  11. Annette Ortiz says:

    I am no fan of Obama but conservatives have a very selective memory when it comes to George W. Bush. Gas was almost $5 per gallon on his watch.

  12. Mike Roddy says:

    This is nothing for them. Rovian Republicans are thugs, and have also claimed that McCain had a black baby, Obama is a Moslem, and so on.

  13. sandyh says:

    Is there anyone not aware that Big Oil is behind just about everything that is hurting our economy, military, and environment?

    Only the the 23-28% of conservative screwballs believe a thing that comes out of the Republican SuperPac propaganda machine.
    It’s gotten almost funny watching people roll their eyes when these conservative stooges and lobbyists try to spin a yarn.

    Big Oil is rolling in profits while the prices continue to rise…cause and effect.
    It’s a mater of simple math and greed.

    Consumers are sick of this conservative BS. So much so, I’m thinking they are ready to deliver a knock out bunch at the polls in response this fall to the GOP for helping the industry.

    The country needs to be investing in the development of clean, affordable, and better products that the rest of the world is demanding. So should Big Oil.

  14. Steve Bloom says:

    Stephen, perhaps it’s time to stop quoting outfits like Cato, since their legitimate work largely just serves as a smokescreen for their propaganda efforts.