For many things we buy, our consumption decisions partially reflect our efforts to convey a certain social status to others. Luxury cars, exotic brands of water and designer perfumes give us much more than the direct enjoyment of consumption; they send a signal to our peers that we are wealthy and powerful, and that we have good taste.
As the political crisis unfolding in Venezuela seizes the headlines, analysts frequently draw attention to the fact that the South American country has the largest oil reserves in the world. The example of Venezuela, as well as several other African and Middle Eastern states, confirms that natural resource wealth is no guarantee of high living standards. In fact, in many cases, it seems as though an abundance of oil and diamonds may have been a leading cause of poverty and instability, rather than a source of prosperity.
The US economy has traditionally been a heavy importer of oil, making it unquestionably a fan of low oil prices. Meanwhile, the shale oil revolution has transformed the US oil industry, and driven net imports to almost zero. But, has that been enough to make America favor high oil prices, and to be an OPEC ally?