Just another case of managers running their personal agenda.

Sir Daniel Gros writes that “it is no mystery that oil supply has not reacted to higher prices. Producers are just waiting for even higher prices tomorrow”, “The China bubble fuelling record oil prices” July 10 and this is far from the whole truth.

The problem lies in that in the many countries where the oil belongs to the State, the current oil revenues exceed their respective governments’ capabilities to use them rationally, and their respective leaders’ most immediate personal needs, and so there is not a lot of incentives for them to produce more.

If on the other hand in all these countries, where the population still suffers many unsatisfied needs, the oil revenue was to be shared out directly to the citizens, the true shareholders, you would see more supply. Again it is all another case where the management run their personal agenda.

Gros quotes King Abdullah of Saudi Arabia that if additional oil were to be found in his country he would advise leaving it in the ground because “with the grace of God our children might have a better use of it” and this he can say only because the current children of his land have no say on it.