The People to Thank for High Gas Prices

[Michael Larson]

Originally Posted by sstanczyk

Let's get real folks. The ever increasing cost of oil at this time is due to nothing more than the damn speculators. You want to see an immediate drop in the price....regulate the speculators.

No, no. no. no. no.

The speculators are only part of the equation. They cannot sustain the speculative increases. It will crash if left alone and a lot of people will be left holding the bag. Remember the Hunt brothers and Silver speculation of a couple of decades ago?

If we increase supply or even commit to start drilling new sources, the speculators will be forced to rethink their positions. the bubble will burst.

Drill, conserve, drill, build refineries, drill build nuclear plants, coal fired, etc etc, etc. and the price will come down.

[tdietrich1]

Funny how we all can agree "MADE IN AMERICA" is important, except when it comes to OIL? Hypocrites/liars and they keep get voted back in.

tom

[Michael Larson]

Originally Posted by tdietrich1

Funny how we all can agree "MADE IN AMERICA" is important, except when it comes to OIL? Hypocrites/liars and they keep get voted back in.

tom

They are the real problem after all.

Washington is not the real world and these anointed blohards like to hear themselves talk while they're trying to convince you they only want to help.

God Bless America and save us from the politicians.

[tdietrich1]

Originally Posted by mlarson

save us from the politicians.

And those who keep re-voting them in.

[Michael Larson]

Originally Posted by tdietrich1

And those who keep re-voting them in.

Amen

[rmaday]

Originally Posted by tdietrich1

Funny how we all can agree "MADE IN AMERICA" is important, except when it comes to OIL?
tom

Well said!

[Stephen W. Stanczyk]

Originally Posted by mlarson

No, no. no. no. no.

The speculators are only part of the equation. They cannot sustain the speculative increases. It will crash if left alone and a lot of people will be left holding the bag. Remember the Hunt brothers and Silver speculation of a couple of decades ago?

The Hunt brothers tried, and for all intents and purpose, actually cornered the silver market and then the rest of the speculators tried to follow suit and jump in. Sound familiar? Then the trading rules were changed by COMEX and the Federal Reserve also stepped in and put a stop to the games. Do you remember March 27, 1980? Silver dropped by OVER HALF. Sure, the speculators were caught and lost their rear ends. The Hunt brothers declared bankruptcy AND were CONVICTED of conspiring to manipulate the market.

If we increase supply or even commit to start drilling new sources, the speculators will be forced to rethink their positions. the bubble will burst.

Drill, conserve, drill, build refineries, drill build nuclear plants, coal fired, etc etc, etc. and the price will come down.

And just why would the oil companies want to drill new sources and build refineries? That would cost them money to expand, and cut into their profits. There is no shortage in the US. We have all the gasoline and oil we want. But at what price? Remember the rolling black outs during the supposed energy crisis? Wasn't it a great time for the power companies to shut down plants for "maintenance". Aw shucks, now there is a shortage and we need more money.... once again, sound familiar?

It isn't the little guy causing all this. It isn't the environmentalists causing this. It is the greed of the speculators. I say do the same thing they did with the silver market. Stop the speculators and watch the oil tumble almost immediately. I would much rather see a number of speculators jumping out of windows because their investments crashed than the public having to pay through the nose for everyday staples because of speculator greed.

[Michael Larson]

It's mostly the politicians that have created and continue to fuel this problem buy refusing to let the oil execs explore and drill and build new refineries.

Business will invest in their business to stay in business just like we do.

Supplies are tight , demand is increasing and this sets up the perfect storm for the speculators.

If you thought gas was going to be $6/gal and had a chance to lock it is at $4 wouldn't you prebuy?

Airlines and many other industries have been doing this for years to hedge their costs going forward.

Do you think Southwest is paying the current price for jet fuel?

The politicians are demonizing "Big Oil" because they think they can get away with it.

I'm not questioning the speculators are a part of this but they are far from the only cause. Without increased supply and/or decreased demand we are locked in a frenzied cycle of trading. Up, up, up and up.

Let's not forget the weakening dollar is also a large part of this. What are the pols trying to do about that? Little and nothing.

[rmaday]

Originally Posted by mlarson

If you thought gas was going to be $6/gal and had a chance to lock it is at $4 wouldn't you prebuy?

That's what Chrysler/Dodge/Jeep are looking for!
http://www.chrysler.com/en/refuel/

[nwagner]

Originally Posted by mlarson

Let's not forget the weakening dollar is also a large part of this. What are the pols trying to do about that? Little and nothing.

Or vice a versa. The price of everything is going up to cover the surge in energy bills that all business are incurring, hence the dollar is worth less.

Originally Posted by sstanczyk

And just why would the oil companies want to drill new sources and build refineries? That would cost them money to expand, and cut into their profits.

Yes Michael, why would the oil companies want to spend their windfall of profits to drive down the price of their commodity? After all, demand continues to remain a constant in spite of their gouging. I find it rediculous to believe that the oil companies would lower their profit margins for the greater good.

[Michael Larson]

Originally Posted by nwagner

Yes Michael, why would the oil companies want to spend their windfall of profits to drive down the price of their commodity? After all, demand continues to remain a constant in spite of their gouging. I find it rediculous to believe that the oil companies would lower their profit margins for the greater good.

Demand is rising causing shortages and hence higher prices.

They don't have to lower their profit margins. They invest in their business to grow their business.

Competition between the different oil companies let the price of a commodity seek it's true value. It's an efficient system if allowed to work.

The term "windfall profit" is often heard but it is erroneous.

Should the government tax an HIs "windfall" profit? Why or why not?

[tdietrich1]

I heard today both Democrats and Republicans say, "Oil companies need to invest in alternative sources of energy."

I AGREE!!! Instead of Importing Foreign Oil, Drill For American Oil!

[Michael Larson]

Agreed, Drill baby drill!

What business is of the government to tell business what it should invest in.

It's still a free country as far as I know, though after this Fall, who knows?

[nwagner]

Originally Posted by mlarson

Demand is rising causing shortages and hence higher prices.

Ahhh, the beauty of being an oil company. Unlike most industries, demand remains a constant no matter how high the price. Where is the urgency for oil companies to increase supply?

They don't have to lower their profit margins. They invest in their business to grow their business.

If that is the case, why don't they simply fund the incumbent Demorats campaigns so that they can do so? They have than enough clout to do so. Perhaps because the urgency isn't there?

Competition between the different oil companies let the price of a commodity seek it's true value. It's an efficient system if allowed to work.

Yeah, the big oil oligachry has done just that, NOT!

The term "windfall profit" is often heard but it is erroneous.

When oil companies are netting more than Wal-Mart, it doesn't sound erroneous to me.

Should the government tax an HIs "windfall" profit? Why or why not?

Never said anything about windfall taxation. I agree it is a rediculous concept that the Demorats champion to look like heros. I don't have hope for the gov't solving this problem, for the polarization on the issue coupled with the lack of balls to take away the power from big oil by agressively pursuing feasible alternative energies to replace oil virtually guarantees the lack of a solution.

[Michael Larson]

Originally Posted by nwagner

Ahhh, the beauty of being an oil company. Unlike most industries, demand remains a constant no matter how high the price. Where is the urgency for oil companies to increase supply?

Sorry, it's not true. As the price goes up demand does increase. People change their habits. Take fewer trips. Take shorter trips. Combine trips. buy smaller car.

If that is the case, why don't they simply fund the incumbent Demorats campaigns so that they can do so? They have than enough clout to do so. Perhaps because the urgency isn't there?

Don't worry businessmen fund both parties.

Yeah, the big oil oligachry has done just that, NOT!

It has and it will. Exxon vs. BP. Shell vs. whoever.

When oil companies are netting more than Wal-Mart, it doesn't sound erroneous to me.

How much is too much? "Big OI's" Return on investment is a lot less than you may realize.

How about Microsoft's profits should we tax their net "windfall"?

Never said anything about windfall taxation. I agree it is a rediculous concept that the Demorats champion to look like heros. I don't have hope for the gov't solving this problem, for the polarization on the issue coupled with the lack of balls to take away the power from big oil by agressively pursuing feasible alternative energies to replace oil virtually guarantees the lack of a solution.

The government probably won't because the politicians are under the spell and control of the environmentalist wackos in this country.

BUT, if the people speak they will change. It happens whenever the public gets ticked off enough to make their voice heard. It takes large numbers to pressure them just like the Amnesty bill last summer.

Alternative energies will come online without government intervention as some clever entrpeneur finds or invents something new that can compete. That will take a while or when the price of oil is so high that the new is cheaper but it will happen.