Suing OPEC A Waste of Time

As the prices for crude petroleum have finally risen to the highest levels in real terms, one is bound to see well-considered and less compelling arguments for a review of the harm that comes from the maintenance of the oil selling cartel OPEC. A reasonably argued piece by Thomas Evans appearing in yesterday's edition of the NYT here, explores the possibility for suing OPEC by the US government.

While it makes for a very tightly argued piece, I am less sanguine about the reliefs that would be sought at that trial. Granted that the price of petroleum is substantially above the extraction price but how would one determine what the fairer price ought to be? This would probably be a waste of public resources and qualify as an exercise in posturing. Many citizens of countries that are net importers of petroleum obviously have an interest in lower costs but the convoluted path to securing a judgment that is described in the article leads me to the view that it is not worth pursuing and is unlikely on its own to result in a price reduction.

So what gives? I think that the economics here is simple, a carbon tax would be able to achieve the desired result by providing the incentive for energy conservation and the rise of alternatives. A law suit is inappropriate against countries that already use petroleum exports as a political weapon. The desirable result is for an alternative and competing source of energy. Fixing the problem of rising energy prices is not about litigation.