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Oil and tax combustion


THE PROTESTS shutting off gasoline supplies in Europe are popular with consumers, oil companies and OPEC governments.

All parties resent the high taxes that European governments slap on oil products. This strike action was undertaken by small business proprietors such as farmers, truckers and commercial fishermen -- not against high prices in the oil field, but high taxes at the pump.

That is not equivalent to American anguish over current gasoline prices. The European protesters are demanding prices and fuel taxes more nearly resembling ours. They envy us.

The irony in Britain is not missed. Small business is acting as big labor has in the past. A Labor government is proclaiming that it cannot be intimidated, just as past Conservative governments did. Public opinion is siding with the demonstrations making life miserable, rather than with the establishment that is being demonstrated against.

Prime Minister Tony Blair, who was assumed to be planning an easy re-election campaign, suddenly appears bumbling, inept and unpopular.

None of this is what OPEC leaders want. Ideological war, economic paralysis, comeuppance for the West, is hardly what OPEC is about. Larger and dependable revenue is. For that, the supplier countries need stable and prosperous markets.

In the United States, the potential crisis would be in home heating oil this winter. The production quota increases agreed to by OPEC are a little higher than what was predicted, but they may not bring down prices.

The biggest safety valve remains the OPEC nations' propensity to cheat. The higher the price, the greater the temptation to produce above quota.

As for Britain, the betting has to be that fuel taxes will come down before the next election. Mr. Blair insists he will not be bullied by demonstrators. Polls and focus groups are a different story. He always listens to them.

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