With Friends Like Opec, Who Needs...Robert J. Barro
Energy Secretary Bill Richardson recently said on TV that "our friends came through for us," referring to recent increases in oil production by Saudi Arabia, Kuwait, the United Arab Emirates, and Mexico. Indeed, oil prices did fall from $32 per barrel in March to about $26 at present. But one has to wonder why our "friends" were in a position to raise oil production so quickly. Perhaps they had been holding down production and were, thereby, partly responsible for the runup in oil prices from around $12 per barrel in early 1999.
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