President Obama About as Responsible for the Price of Gas as Chocolate
This week, there is a surging Republican chorus blaming President Obama for the rise in gas prices. To understand how absurd the finger pointing is, let’s for argument’s sake substitute the word gas with chocolate and imagine that the price of chocolate is going up.
Sometimes called the “food of the gods,” chocolate comes from the “beans” – actually the seeds - of the cocoa pod. West African countries Ghana and Côte d’Ivoire produce about 70 percent of the world’s cocoa. However when you bite into a bar of chocolate, you can’t tell the origin of the cocoa beans that produced it. All you think about is how sweet, delicious and flavorful the chocolate is. In the same way that chocolate comes from the processing of cocoa, gas comes from the refining of crude oil. When you fill your vehicle’s gas tank, you can’t say that the gas originated from Nigeria as against Saudi Arabia. All you know is that the gas enables your car to run.
These similarities are pointed out to demonstrate that, as physically different as chocolate and gas may be, they are both commodity goods. A commodity has full or partial fungibility; that is, the market treats it as equivalent or nearly so no matter who produces it. Other examples are coffee, copper, and sugar. The most striking feature of all of these is that their price is largely influenced by world commodity markets and is dependent on factors such as global supply and demand, political instability, and the economies of producer countries. For example, if for one reason or another there were a massive cocoa crop failure in either Ghana or Côte d’Ivoire, there isn’t a single country in the world that could step in to replace the deficit, and chocolate prices would be sure to rise. Don’t for a moment imagine that the major chocolate producers like Mars are not concerned about such a scenario.
In the same manner, manipulations by OPEC or the present worries about Iran can cause a rise in gas prices. President Obama is about as responsible for the price of gas as he is the price of chocolate. There is little or nothing he can do about either one. Crude oil prices affect gas prices, and neither the United States nor its President play a significant role these days in determining the price of crude oil. It is the height of deceit for Republicans to suggest that President Obama’s energy policies are “causing” the rise in gas prices. Think about that the next time you have a Hershey’s Kiss.
Kwei Quartey is a physician, novelist, and Foreign Policy in Focus columnist.