Washington Post’s Oil Shock series takes a global view

American laborers, Wall Street bigwigs and Saudi kings — the Washington Post’s new series on oil has it all. The first article in the series, an overview published yesterday, took the broad view, showing that supply, demand, international events and even culture are all to blame for the recent spike in prices.

The second article, published today, narrows the focus to China’s increased demand for fuel. Also notable: this article on Wall Street speculation. The futures market in oil has grown exponentially in recent years. Speculation may have translated into the skyrocketing costs now affecting consumers.

It’s a well-reported, sweeping series so far. Here’s what the Post did right:

“Oil Shock” is about the global crisis, not just the American take on it. The article highlights consumers in other countries who are angry about the increased cost of driving:

Abroad, riots shook India after the government trimmed fuel subsidies. Truckers in Britain, France, Spain and South Korea have clogged the roads to protest rising fuel prices.

It’s about history. “Oil Shock” takes readers back to the 1970s, when oil was costly because of geopolitics, and then to the 90s, when oil was cheap and getting cheaper:

Earlier oil shocks have had obvious causes. In October 1973, OPEC raised prices and declared an oil embargo against the United States and other countries that had supported Israel in its war earlier that month against its Arab neighbors.

…

The tightening of the oil market reflects decisions made a decade ago, when conditions looked radically different. Regular unleaded gas was less than a dollar a gallon. Oil was little more than $10 a barrel. And the Economist magazine, predicting prices could soon be half that, ran a cover story with the headline: “Drowning in Oil.”

Those low prices sent the wrong signals to consumers and oil companies alike.

The overview lets readers know that somebody is benefiting, but it isn’t the little guy:

Exxon Mobil, the biggest of the independent oil giants, last year broke records for U.S. corporate profits, chalking up $40.6 billion. This year, it is on track to earn even more.

The Post reporters follow the money — right back to Wall Street and the OPEC nations:

Thanks to the rapid and sustained rise in prices, oil-producing countries are also accumulating vast reservoirs of money in one of the most massive transfers of wealth in history. Every day, oil consumers pay $6 billion to $7.5 billion more for crude oil than they paid six years ago. At the current rate, they will pump more than $1.5 trillion a year into the coffers of OPEC, Russia and other oil exporting countries.

They sum up consumer and political culture in the U.S., and describe how both contributed to our dependence on black gold:

For the better part of a century, U.S. policy contributed to this pattern of development. Taxes on gasoline were set aside for highways, which opened up more vistas for new communities. This in turn promoted even more driving, more gasoline consumption and more tax revenue for highways. Today U.S. automobiles use more than 9 million barrels of gasoline a day, more than any other country.

Most of this is not new. But the power of the series lies largely in its aggregation of all the pieces of the puzzle. Consumers + Producers + History + Investors + Global Politics = One Big Mess.