Posted on 06/09/2014 5:07:51 AM PDT by ckilmer
Since demand keeps dropping.
On the one hand its best for frackers to have oil at these prices. On the other other hand its nicer to pay 3.00 at the pump than 3.60 or so. On the third hand, I saw an article the other day about the majors saying they needed oil at about 120@barrel to do the arctic drilling and other speculative—big cost up front— drilling.
We get reports here in FR about how much oil we're producing and how we are rapidly approaching the world's largest producer/refiner and yet .. we have gasoline pushing 4 dollars.
I have the same question ...
why ?
Pigs get fat.
Hogs get slaughtered.
See the chart posted above. Global consumption is climbing. We still continue to import significant amounts of oil, not much less than we produce ourselves.
Our production has been climbing due to the relatively high prices. Otherwise we would not see the climb in production and more of our dollars would be going to OPEC rather than staying in the US.
Actually there is a great excuse, perhaps the greatest ever.
The Democrats must be defeated, trashed, destroyed in November.
To give them the advantage of lower gas prices would be counter productive, even tragic.
American business has decided that the end to the Obama tyranny can be forced by concerted action. American business has taken all it will take and is using the weapons at hand to fight back.
The high gas prices are the answer to the question. “Do we depose the President by coup d’état or by using our business capabilities to destroy him?”
“why ?”
This all makes a lot more sense if you look at it from the other direction.
Thanks to years of deficit spending and money printing the US fiat dollar is now worth only 1/3 of a gallon of gas, or 1/1200 of an ounce of gold. If this country doesn’t change course immediately I would expect the US dollar to shortly be worth only 1/10th of a gallon of gas or 1/5000th of an ounce of gold, or perhaps far less.
Why? Because we are paying based on world supply/demand, regardless of local supply/demand.
Forget OPEC, we are being reamed by our own oil industry.
Never mind the fact that it is cheaper drill/refine/sell it here, as opposed to shipping it across the world. You are paying the world price.
Russia
You think it is cheaper to produce from our tight shale formations than the massive flow from Saudi’s Ghawar?
Bullseye!
Subtract the terrorism and shipping, yes.
Nope.
More people around the world are using oil and the refined products from that oil.
Millions more Chinese, Russians, Indians, etc. own cars than they did just a few years ago and they are willing to pay the price to drive them.
China has also been stockpiling.
If you think the election of a Republican in 2016 would result in significantly lower gas prices then you're fooling yourself.
This is a much better way to compare commodity prices.
$USD is like pricing in Charmin these days (except for Venezuela).
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