Gas prices falling, why?

[Dago]

So, we have all pretty much had to notice the price of gas has fallen quite a bit.

Has anyone wondered why it has plummeted???

When it was skyrocketing, it was all "supply and demand" BS, you know, "we need off shore drilling".   Well, was there a sudden large increase in supply?  Did demand suddenly decrease a tremendous amount?

Why have gas prices fallen 38% in a very short time?   Can't be tied to Fannie Mae and Freddie Mac, and sub-prime mortgages now can it?

Did someone in the gov't whisper in the oil companies ear  "hey, the economy has gone to crap, how about backing off those sky high prices and profits for a while?".

Is the impending election a motivator?  Maybe make the Republicans look a little better?

Are we, with our thirst for oil, so emotionally grateful for relief at the pump, allowing ourselves to be manipulated like puppet sheep?

Just what the fxxk is causing this big drop in price at this time?

Why did it go so high to start with?

[Motherland]

We're now actually cutting down on our usage of oil... for the first time in history IIRC? At least since the last gas crisis.

[Dago]

We're now actually cutting down on our usage of oil... for the first time in history IIRC? At least since the last gas crisis.

In the matter of a few short weeks, we have cut usage by 38%?  I don't think so.   Supply and demand?  Did we ever really run short?  With the exception of a temporary refining issue caused by the hurricane, nobody has had to wait in line for gas.  There was always plenty to go around.  Did OPEC just drop prices because they felt like being nice guys?

[Motherland]

I didn't mean to suggest that was the only reason, but I'm sure it contributed to it.

[Dago]

I didn't mean to suggest that was the only reason, but I'm sure it contributed to it.

I am sure it had an effect, but couldn't be that much, do you think?

[FLOTSOM]

actually it seems to be a paranoia based issue.

one candidate wants to open local off shore drilling the other doesn't (neither do the foreign oil producers)

one candidate wants us to realize that we are in an energy crisis the other wants to under play it (same as foreign oil producers)

one candidate wants to stabilize the middle east before withdrawing our troops the other doesn't care about stability and wants to pull them out now leaving the majority of the worlds oil reserves solely in the hands of foreign powers (same as the foreign oil producers)

give the sheep want they want just before the election and the sheep will stop believing there is a problem and are more inclined to vote in the direction that you lead them in.

now ask yourself..................who sets the prices for oil??? who could decide to drop price per barrel?? why now, right on the verge of winter (traditionally the time oil prices rise) and just before the electionwho gains if the sheep are lulled into believing that the crisis isn't really that bad and that it is fine to vote for the person who will not push for offshore drilling and stability in the middle east, but instead would happily leave us being financially milked dry by foreign powers who control the only available oil without any American presence in the area to ensure who controls that oil.

one final question

which candidate received millions of dollars in campain contributions from foreign companies.................... ..........

obama? sound familiar????

[Hooligan]

Gasonline is a commodity.  Current price is based on speculation about future demand and availability.  Strong hints of a world wide depression may have a lot to do with this...

Hooligan

[Ripsnort]

Don't get used to it, Opec will cut production, sending prices back up to $4 a gallon in Jan 2009.

[1pLUs44]

Gas out north east of our town, about 20 miles out apparently has gas at something like 2.15-2.30 last I heard... Someone even said it was at 2$$. 

[superpug1]

I bought gas for under 3 a gallon today. it felt good to fill up the car and not spend 60 bucks. it cost 47 lol.

One reason is that the US dollar is actually stronger on the world market. While our economy has been hurt, the world economy was hit worse, so the dollar is worth abit more. I think its only$1.30 to the euro now. That can bring prices down.

[SHawk]

Apparently you guys haven't seen what a barrel of Oil has droppped to in the Stock Market


Highlight the 1y on the bottom of the graph to see the trend from the last year.

http://www.oil-price.net/

[Nwbie]

Apparently you guys haven't seen what a barrel of Oil has droppped to in the Stock Market


Highlight the 1y on the bottom of the graph to see the trend from the last year.

http://www.oil-price.net/

scroll down to this section- Profitability and $100 oil by Steve Austin - 2008/01/05

amazing

[BluTrain]

I understand the point about speculation made by Hooligan and that is part of it.  I also understand the point made by Motherland. Both are correct to a degree. One factor that hasn't been mentioned is the fact that if gasoline rises past $4 USD per gallon or even hovers there for the next 24 months or so, the demand for alternative fuel cars will rise to the point that the next Administration, House, and Senate will be forced to enact legislation that WILL effectively kill the current fuel industry as we know it today.  As long as gasoline, heating oil, and petroleum products in general are affordable to the masses there will be no mainstream alternative fuel.

[eagl]

The "demand" was based on oil futures, and the price on oil delivered sometime in the future was driven by speculators betting that demand would continue to rise and rise.

The banking crisis pretty much guaranteed that real demand for oil will remain flat for the next few years, so the price of oil has dropped to a much more reasonable and "real" price that reflects the reality of the supply/demand situatoin.  Anyone betting that demand will quickly rise is going to lose their shirt.  The super high prices reflected a nearly 50% speculative boost and an insane bidding war that pretty much matched the stupidity in the housing markets.

The value of the dollar also has a big impact...  Yea the US stock market has taken a huge hit but other global exchanges have seen up to DOUBLE the losses.  The asian/pacific markets have seen upwards of 60% losses in the last 3 weeks, while the US stock market is down maybe 35-40% tops.  That means a very real decrease in expected future demand, so there is no reason to bid up the price of oil to be delivered tomorrow, next week, etc.  The demand just isn't going to increase until companies have cash and credit to work with again.

[Nilsen]

We're now actually cutting down on our usage of oil... for the first time in history IIRC? At least since the last gas crisis.

Same thing over here. Consumption of oil has gone down alot so the price also has gone down. Prices on pretty much everything has gone down because people are abit more careful with their money.

Its called supply and demand.