America's Irresponsible Leadership since 1973 has come to make our foreign policy - "HOPE"

Bush ***hopes*** Cheney's Mideast visit will rein in oil prices

By Brian Knowlton

Monday, March 10, 2008

WASHINGTON: With oil soaring to a record $108 a barrel amid mounting signs of U.S. economic turbulence, President George W. Bush said Monday that he was sending Vice President Dick Cheney to the Middle East to raise concerns about oil prices and to press Israeli and Palestinian leaders to move toward peace.

Welcome to the price of Arab cooperation. Can there be any doubt?

Cheney, who leaves Sunday, will meet with King Abdullah in Saudi Arabia, the world's

biggest oil producer and the de facto leader of OPEC.

"Obviously, we want to see an increase in production," said Dana Perino, an administration spokeswoman. "The president does want OPEC to take into consideration that its biggest customer, the United States - our economy has weakened and part of the reason is because of higher oil prices. We think that more supply would help, and I don't anticipate that the vice president would have any other message than that one."

The Bush administration is struggling to revive an American economy that is sagging under the weight of a housing slump, rising prices and a credit crisis, and it has had little luck persuading OPEC to increase production levels.

At a meeting Wednesday in Vienna, OPEC rebuffed a Bush statement two days earlier calling for increased output.

OPEC said speculators and what it called the "mismanagement" of the U.S. economy were to blame for high oil prices.

Don't piss on my back and tell me it's raining.

The cartel left its production levels unchanged, saying that the market did not need more oil.

Cheney will meet in Israel with Prime Minister Ehud Olmert and on the West Bank with Mahmoud Abbas, the Palestinian leader, to urge both to "uphold their obligations" to move toward a peace settlement a stated priority for Bush in his waning months in office.

Bush sent Secretary of State Condoleezza Rice to the area recently to persuade Palestinian leaders to resume peace talks with Israel after a deadly Israeli military incursion into Gaza. Hopes for a peace settlement were further shaken Thursday when a Palestinian gunman attacked a seminary in Israel, killing eight students.

A reporter asked Perino on Monday whether Cheney was on a "rescue mission" because Rice had failed to achieve what Bush wanted. Perino called that "a little bit outrageous" and praised Rice for being able to pull the parties "back from the brink and have them recommit to having discussions."

Cheney will also visit Oman, a significant non-OPEC oil producer, and hold talks with its leader, Sultan Qaboos, a respected intermediary between oil-producing and oil-consuming countries.

Cheney will also confer with Turkish leaders in Ankara.

At a time when some OPEC producers are skeptical of the U.S. role in Iraq and the region and others, like Venezuela, are frankly hostile, it was unclear what enticements Cheney might have to offer.

With the U.S. economy slowing, investors have been fleeing stocks in favor of commodities like oil. But oil is sold in dollars, and with the value of the dollar falling, oil exporters have to sell more to maintain their earnings levels.

OPEC members already are unhappy that the Bush administration has done little to prop up a weak dollar, something that makes oil more expensive but also bolsters U.S. exports.

Bush last week called it "a mistake" for OPEC to let prices reach levels where they slow the U.S. economy.

Still, oil prices have risen a further $4 a barrel since the OPEC meeting, hitting a record $108.21 a barrel on Monday on the New York Mercantile Exchange, after investors began buying oil futures to hedge against a depressed dollar and inflation.

Oil prices have risen more than 70 percent in the last year.

The record prices have sharpened tensions between OPEC and the United States, the world's largest oil consumer. An earlier plea by Bush, lodged in January during a trip to Saudi Arabia - during which he spent a night at King Abdullah's farm - also brought no result.

OPEC's 13 member countries produce about 40 percent of the world's oil exports.

The timing of Cheney's visit might be further complicated: Investors and analysts expect the Federal Reserve Board, meeting March 18 in Washington, to announce an interest-rate cut of perhaps 50 basis points, or a half-percentage point.

Lower rates can translate to a weaker dollar and thus higher oil prices, though the markets have largely taken the anticipated cut into account.

The U.S. economy is beset by a troubling combination of rising consumer prices and lagging growth, expected to remain anemic this year.

High oil prices, and the steady increase in U.S. gasoline prices to near-record levels, are problematic enough for the White House, but even more so in an election year.

Gas prices now average $3.23 a gallon nationwide, after rising 6 cents over the last week, the federal Energy Information Administration said Monday.

Bush, speaking to reporters Monday during a news conference with the visiting Polish prime minister, Donald Tusk, spoke at some length about his aspirations for a peaceful, two-state settlement involving Israel and the Palestinians.

He said he hoped that both the Israelis and Palestinians would re-engage in the peace talks and that he was still aiming for an agreement by January.

"But violence in the Gaza Strip and southern Israel has hampered the peace talks," Bush said.

You utter fool, the desire of the Palestinian peoples in the election of the HAMAS govt makes the idea of a peace process the dream of delusional incompetents, and I voted for you twice.

Still, he said, "I'm optimistic that we'll be able to achieve a vision that shows a way forward, and I'm optimistic leaders will step forward and do the hard things necessary so people don't have to live in deprivation and fear."

Bush said that Cheney's goal in the region was "to reassure people that the United States is committed to a vision of peace in the Middle East," but also to call on Israelis and Palestinians to "uphold their obligations on the road map" plan for peace; and to talk about threats to the region, including Iran, while bolstering security relationships with friendly countries.