An Energy Crisis Made in the West
The renewed spike in energy prices, however, has no direct relationship to the new “economic Iron Curtain” (cf. previous item). Sanctions have hit neither oil nor natural gas. The hyperinflation of energy prices is a story entirely made in the West. As we have often explained, energy prices are determined by financial speculation on commodity markets. Reuters reports that the daily volume of oil options traded at the Chicago Mercantile Exchange doubled at the beginning of March, from an average of 126,000 between Jan. 19 and Feb. 9, to 240,000 in the first two days of March. It is such bullish bets of course that, by creating an artificial scarcity of oil, push the price higher and higher.
Instead of acting on the basis of such evidence and introducing market controls, European governments are accusing Russia and “the war in Ukraine” for the energy price increases, despite the fact that Gazprom has even increased the volume of gas pumped through the pipeline going through Ukraine.
High energy prices will cause runaway inflation in all sectors of the economy and bankruptcies in the industrial and trade sectors that are also threatened by the global disruptions created by the new Economic Iron Curtain.