Wednesday, September 20, 2006

The real deal with gas prices

Gas prices have fallen. That much is true. The question remains as to why prices as recently as one month ago escalated as high at $3.19 in Minnesota and as of two days ago had dropped to as low as $2.14/gallon. It seems more than peculiar that the price of something that remain nearly unchanged for the first 21 years of my life could suddenly climb from its stable price of around $1.00/gallon in 2000 to $3.19/gallon six years later.

The question was asked locally on WCCO in their 'Good Question' feature and the blame was placed on speculators in the marketplace who bid up prices on what they THINK demand and consumption as well as supply will be in both the distant and near future.

Never being satisfied with the outright easy answer, I think there is something more happening. Initially, the price hikes were blamed on rapid expansion of the economy and the associated increases in usage of fuels in China and India -- places where many formerly American jobs now reside. No country experiences growth at such an incredible rate that they can justify world gas prices increasing over 200% in six years. Even in the technologically advanced world we live in, it seems impossible.

What some people are leaning towards for an explanation, even as experts are now predicting oil as low as $15/barrel when just months ago the same 'experts' predicted oil topping $100/barrel, is that the enormous swings in gasoline prices are politically motivated. Low prices at the pump make for happy Americans. High prices make us angry. When the prices were high, Bush's approval rating hovered around 30%. As prices have now dropped, his approval rating is around 44%.

There is one thing to remember. Gas prices are not the be all, end all that we should judge a politican's performance on. Remember, if we are praising the president because the gas prices are low, he is the same man that was in control as gas blew past the $3/gallon mark. One could go as far as to assume that Bush's ties to oil companies are having an effect on the oil prices. If everything is seen as politically motivated, the very THREAT of Democrats gaining a few strategic positions in the November elections would be more than enough for Bush's cronies to see the negative impact the loss of a republican majority would have on their financial portfolios.

While this is all up in the air for the time being, I still hold Bush accountable for miscalculations and outright fuck-ups involving the blatant ignorance of information leading up to the 9-11 attacks, wrongly leading us into a war in Iraq, allowing bin-Laden to still run free, escalating health care costs and his ass-backwards attempt to privatize social security. Will the predictions of some that gas prices will spike after the November elections ring true? I hope not but will not rule anything out until I see what happens. After all, we didn't see $100/barrel oil but it isn't exactly still steadily dropping towards $1/gallon gas either.

If prices do drop, it isn't the time to become complacent. We should instead seize this opportunity as a time to freely invest in alternative energies so we can be prepared when prices again skyrocket. If not, we only have ourselves to blame.


SlimAdam said...

sometimes you remind me of mel gibson from that flick 'conspiracy theory'. other times you just outright remind me of mel gibson.

betmo said...

it is absolutely politically motivated. the oil and gas prices are set by the companies who refine the output by the middle eastern folks. it is the refining capacity that people should look at. you can't make a 5,000% profit if you refine at the rate that you should. couple that with the fact that i think almost every american owns a 2 miles to the gallon suv- bingo. car gas isn't as concerning to me as home heating fuel. that will be the real tester.