They're very happy with oil prices the way they are now because it maximizes their revenue and their not too upset if American consumers are suffering. On the other hand, Saudi Arabia has a bit of a conflict of interest here. It needs to keep the American consumer happy and the American government happy. There are American troops protecting its oil field from Saddam Hussein, for example. I think that ultimately what's really happening is real politick.
Oil makes for strange bedfellows in other ways.
The Los Angeles Times reports today that Iran has set up a strategic island to funnel oil to Iraq, to help its longtime enemy thwart United Nations economic sanctions. Marketplace's Stephen Henn reports. There is a real worry that for some of these countries the point of actual cancellation may never come. As a continent, Africa spends four times more money paying off foreign debt than it does on health care. Latin American debt equals roughly a third of that areas economic output.