$5 a gallon?

[Jardavius]

With all the instability in Egypt and Lybia the reports are starting to hit that we may see gas prices of $5 a gallon or more this summer. How long are we going to let an endangered bird or whatever stand in the way of us using our own resources and losing our dependence on a part of the world, That has everything to gain by hurting the western world anyway??? Then my conspiracy theory part of my brain started chugging along at full throttle today.

What if:

We are holding on to our oil reserves, waiting for the oil markets to skyrocket. If oil hit $200 a barrel and arab production capacity was seriously crippled how long would it take the US to clear up it's incredibly massive debt problems??? Obama is trying to fix our national debt by scamming the world people!!!

Seriously though, our economy is too fragile to take this kind of hit, we need to take care of ourselves now. And while we are at it, while I would rather not have the government involved in anything really, how is it right that when prices surge like they did a few years ago that oil companies make record breaking profits. How did they make those profits?? By fleecing their customers and that needs to stop.

The price of oil for West Texas Intermediate Crude (WTI) now sits at over $100 a barrel. WTI is the benchmark for the price of oil traded on the New York Mercantile Exchange (NYMerc) and delivered in the United States with Cushing Oklahoma as the point of delivery. The other benchmark for oil pricing is Brent North Sea Oil traded in world exchanges especially London. Today the quoted price for WTI is $101/bbl while Brent is trading significantly higher at $114/bbl.

The difference reflects a difference in supply in the U.S. Domestic market and that of the European and otherwise world markets. We have ample supply of oil in the United States with stocks both commercial and government (the Strategic Petroleum Reserve -'SPR') at or near all time highs.

Yet the events in Libya, more out of fear and distorted trading on the exchanges have pushed the price of oil to levels that are threatening the economic recovery worldwide even though our market is amply supplied. Yet, importantly, because of the current schism in the price of oil (WTI vs Brent) we are in a position to do something about it.

We have a Strategic Petroleum Reserve holding some 750 million barrels of oil. Oil available to the nation in case of national emergency. The looming economic crises caused by the massive jump in oil prices must certainly be classified a national emergency.

Given that our oil markets are well stocked, it is the traded price of oil that poses the grave economic danger. The government, by systematically releasing 200,000 to 300,000 barrels of oil a day from the STP until the events in Libya are resolved, could break the trading psychology that has overtaken the U.S. oil market and bring down the the price of WTI crude by some $20 to $30 a barrel. It might not impact the price of Brent crude directly but would certainly send a message to the International Energy Agency (IEA) to do likewise in that they control government stocks of 1.4 billion barrels.

Of course the oil industry and most likely the likes of the American Petroleum Institute will marshal their lobbying firepower to forestall such a dynamic initiative by the Administration, Such attempts will once again underline the divergence in interests. priorities and responsibility between the oil interests and the nations well being. Should that come to pass, perhaps this is the moment to strongly consider the 'Norway solution' and nationalize the oil industry altogether. Certainly in Norway the national patrimony of that nation's oil riches and its administration has benefited that nation making it the envy of much of the world. There is something wrong with our system here whereby many Americans are freezing in the cold of winter permitting a given sector of the economy to cash in.

[B2K24]

$5 a gallon, No thank you. All the more reason to stay at home and work on my Hyperspin and GameEX setup

After watching the news the last couple days, Obama only seems to care about the same sex marriage issue and has said nothing about resolving more important issues from what I have seen.

[Circo]

$5 a gallon, No thank you. All the more reason to stay at home and work on my Hyperspin and GameEX setup

After watching the news the last couple days, Obama only seems to care about the same sex marriage issue and has said nothing about resolving more important issues from what I have seen.

For once I would like to see DC be PROACTIVE to a situation vs just hoping the big issues go away.

[Jardavius]

For once I would like to see DC be PROACTIVE to a situation vs just hoping the big issues go away.

Pretty sure you can forget about that, i'm sure they are well aware of the profits to be made here. They could care less about us.

[Dr. Leyland Strom]

So, this topic is closed, other than:

STOP VOTING FOR THOSE TEA PARTY FUCKS

[Tempest]

It cracks me up that people complain about the price of gas, but will at the same time go inside and pay $1.25 for a quart of water.

Oh yeah, and blame Obama. Every president since LBJ has been promising to do something about it. The truth is the whole government is corrupt, and pointing fingers at one person, or one party doesn't help. I'm sorry that I can not offer a real solution to the problem.

I would sure like to hear some ideas though...

Edited March 6, 2011 by Tempest

[VitaminYesSupplements]

On 2/24/2011 at 7:03 AM, Jardavius said:

With all the instability in Egypt and Lybia the reports are starting to hit that we may see gas prices of $5 a gallon or more this summer.

Good thing we didn't. It's nice to look at posts like this six years later, and find out how correct they were in hindsight.