I used to be an energy correspondent of a newspaper in Nigeria’s business capital, Lagos. In that role, I covered the oil industry in Nigeria. As the country with the 10th largest reserve in the world and 5th oil supplier to the United States, you would think that Nigeria’s oil account is in order. In Nigeria, the production quota is mere fiction. More oil bunkering involving military officers, high level government officials and oil executive goes on more than legitimate oil production. It is not very different from what is going on in other OPEC nations.

At an OPEC meeting in Geneva in 1993, I watched the Cartel perform their twice a year ritual. It was not different from a typical meeting of the mob families a good example of which was the scene in the movie, Analyze This. While words were being said on camera, the actual action could be found in things happening behind the scene. Sheiks and princes, dictators and soldiers, all mingle around negotiating off the radar deals for their individual countries and at the same time for their personal pockets. At the end, figures would be announced as the new quota. Figures that everyone knows are meaningless. Pledge would be made to stick to the quota; that is pledge that nobody would keep.

So how oil much does OPEC produce? OPEC does not know. OPEC does not care. OPEC’s production quota is simply a mere figure regularly announced as a guide. How much demand is out there in the market? OPEC does not know. OPEC does not care. OPEC simply enjoys smiling to the bank.

If the world is serious about doing something about high oil price, someone will know how much oil is being consumed by every nation and how much is being produced. But none of these figures are readily available in a reliable form.

That is why you hear Saudi Arabia say that if there is a real demand for crude that is not being met, the Arab state will increase production. And at one point it actually increased production unilaterally way beyond the quota OPEC assigned to it. Yet, the oil price did not fall.

The U.S has the most detailed figures of its oil habit. According to U.S. government information, the United States consumes about 20 million barrels of oil everyday. If Dick Cheney has not tampered with this figure, it means that U.S. oil use is still astronomically higher than China. According to the Washington Post, from 1995 to 2004, U.S. oil imports grew by 3.9 million barrels a day while China’s grew by 2.8 million barrels a day.

Yet, you have it said often that the recent spike in oil price is as a result of an increase in demand by China, India and other emerging markets. By how much were these increases? The estimates out there vary tremendously.

According to Oil and Gas Journal, the world’s oil reserve stands at 1,292.6 billion barrels in 2006. With Saudi Arabia, 264.3 billion barrels, Canada 178.8 billion barrels, Iran 132.5 billion barrels, Iraq 115.0 billion barrels and Kuwait at 101.5 billion barrels at the top five. The United States, the world largest consumer – the addict, is at number eleven with 21.5 billion barrels.

According to the U.S. Energy Department, the United States produces 5.1 million barrels a day. The greatly expounded offshore drilling and drilling at the Reserves will not close the 15 million barrels gap in U.S production vs. importation. According to 2005 statistics, the total world oil production was 82 billion barrels a day while the total world oil consumption is 83 billion barrels a day. At the present consumption rate, the world reserves will run out in twenty years.

Every missile that hits the sky in the Middle East leads to a jump in oil price. Every hurricane that approaches the gulf coast leads to a big leap in oil price. And each time Nigerian militants fires a shot at a flow station in the Niger Delta region, the world oil price climbs. I cannot think of any other major commodity market this volatile.

Then there are the speculators. Nobody really knows who they are and what they do and under what rules they operate. In the oil market we have an active wild wild west where everything goes and mobs and cartels run things.

The trouble is that it affects all our lives. They do not screw each other up. They screw us all up.