WASHINGTON -- Fuel and food prices are up. So is unemployment. Officials in the Obama administration and their allies on Capitol Hill are stunned. They shouldn't be. It's O-Team policy -- or lack of it -- that got us here.
According to the U.S. Department of Labor, the number of Americans seeking unemployment benefits for the first time jumped this week to 397,000 -- meaning there are more people looking for work than the private sector has jobs available. You don't have to be a government economist to see the direct connection between rising costs for essentials -- such as gasoline, home heating fuel, electricity and eating -- and layoffs.
This week, the U.S. Energy Information Administration claimed the new spike in the cost of fuel is the result of a "sudden and dramatic increase in crude oil prices" precipitated by "political unrest in North Africa, including violent uprisings in Libya." Truckers buying diesel and those of us who heat our homes with fuel oil are already paying a nationwide average of $3.87 a gallon -- up a whopping 35 percent from a year ago. On March 9, our government experts forecast regular-grade retail gasoline -- already 38 cents a gallon higher than it was a month ago -- will "average $3.71 per gallon during this year's summer peak driving season." That prediction ignores reality.
Instability in Yemen and Bahrain and Somali piracy already have added to supply uncertainty and contributed to higher global prices for crude oil. Now Libyan sweet crude production -- more than 1 million barrels per day -- has all but ceased. Just hours after French President Nicolas Sarkozy granted formal recognition to a rebel "interim government" in Benghazi, James Clapper -- the Obama administration's hand-picked director of national intelligence -- publicly told the Senate Armed Services Committee he expects that Moammar Gadhafi's "regime will prevail." But even if he's right, Libya's major oil port at Ras Lanouf is likely to remain "offline" as long as Gadhafi holds on to power in Tripoli.
Unfortunately, what happens in Libya may turn out to be the least of our "oil troubles" -- no matter what the Obama administration finally decides to do about supporting the rebels or a no-fly zone to keep Gadhafi's air force grounded. Less than 24 hours after this week's EIA forecast, crude oil prices spiked again -- and international financial markets plummeted -- on reports of unprecedented violent anti-government protests in Saudi Arabia, the world's No. 1 oil producer.
Oliver North is a nationally syndicated columnist, the host of War Stories on the Fox News Channel, the author of the new novel Heroes Proved and the co-founder of Freedom Alliance, an organization that provides college scholarships to the children of U.S. military personnel killed or permanently disabled in the line of duty. Join Oliver North in Israel by going to www.olivernorthisrael.com.