George Jarkesy

Leaked transcripts of a secret meeting between Russian President Vladimir Putin and the head of Saudi Arabia's secret police, Prince Bandar, have exposed how desperately the Saudi Arabians want Bashar Assad deposed as the President of Syria. Bandar explained to the Russian leader that many of the Chechen Islamist groups that have bombed Russia – and whom some consider as behind the Boston bombings – are controlled by his spy agency in Riyadh. He explained to Putin that if Russia stops supporting President Assad, the Chechens will not bomb the 2014 Sochi Winter Olympics, and he promised Saudi Arabia's “cooperation” with Russia on global oil prices.

An alliance between Saudi Arabia and Russia over the price of oil can only mean one thing for America: Higher oil prices. Saudi Arabia does not seem to care about that so long as Assad is gone. But America should care because every $10 increase in the price of oil takes away half a percentage point from our GDP growth within two years.  That's about $75 billion being subtracted from our economy by just a $10 spike.

Oil has already risen 5% since the start of August -- or an $8 per barrel increase. While this makes the Saudis richer, it weights heavy on the America's economy (which growth is already sluggish). One way we could help offset this increased burden is by further expansion of oil fracking, which would drastically reduce energy costs nationwide and supercharge America's petro, chemical, and industrial manufacturing bases. If Russia backs away from supporting Assad in-exchange for safety from Chechen bombers and oil price control, how many think Brent Crude will not spike to the $150 range?  What will happen to our tepid economic growth then, without fracking to help us?

As well, such negative economic disruption is likely to help the price of the yellow metal. Gold has surged from its year low of $1,200 in June to $1,416 per troy ounce. That is a 15% increase in less than three months.

The desperation exhibited by the Saudis to throw Assad out reveals how little they care about respect their relationship to U.S.  We already know about their deep links between the Muslim Brotherhood in Syria and Egypt and the Sunni Islamists of Arabia -- that has been well-documented. But as the Saudis and the Qataris continue to increase their financing and support of Sunni extremism – and buying off Western politicians and Russian industrialists – it would seem that oil's price and the price of gold is set to rise in concord too now. 

George Jarkesy

George is the host of the nationally syndicated “George Jarkesy” radio show and also a frequent commentator and guest on FOX Business News, FOX & Friends and CNBC.