Question about Government Influence on Oil/Gas Prices

[Anonymous]

I was talking to my mother today about the fact oil prices are expected to continue to rise, and there have been some predictions of gas prices hitting $5 a gallon or so in the next year. She said that it likely will happen because Obama's in the White House, and "no other president would allow that to happen." What type of power does the president have over oil/gas prices? I suppose he could open up reserves a bit, but is that always wise? Does it have a significant impact? And there's increasing domestic drilling, but that wouldn't have a price impact for years, would it? What else am I missing? Or is her comment just because she hates Obama so much?

[Anonymous]

First, Obama is oh so hateable.

Second, Obama stated in campaign mode, "$8.00 per gallon gas was OK with him as long as the price did not increase too rapidly." Are you getting a clue now and the warm fuzzy feeling that goes along with it? Damn, I will never get the chance to study economics at Harvard; do you think he really did?

Thirdly, he declared a moratorium on Gulf drilling after the leak began and hundreds of wells were shut down. Oh, some workers immediately lost their jobs too, no big deal. Oh, please recall his administration had just awarded that well some award for good operating procedures. Maybe Janet Napolitano got off course and was involved in that one.

Fourthly, the invesors in the equipment for those hundreds of wells unlike the investment tycoon Obama thinks he is, started having their rigs towed to other parts of the world to drill.

Keep listening to your mother. Say hi for me, and watch the Obama Brain Trust at work.

[Anonymous]

Umm as someone who has worked in the oil sector (not there anymore though) I'd say both mom and the PP are off their rockers. The price of oil is dictated by the market, not by the USG. The price dropped in 2008 because of the global recession, which decreased demand. For the prior six years, the price of oil had been on a steady rise (peaked at $148/barrel in 08) because of increases in demand, mostly coming from China and India (with epic growth rates of 9% and up) as well as other parts of Asia and the Middle East. Current price spikes are related to instability in key transit corridors (look at a map and see where Bahrain sits) as well as in producing countries like Libya. Sure the moratorium on US deep water drilling is a factor cutting into supply, but compared to what Saudi produces it's literally a drop in the bucket. There is sufficient spare capacity in the market to keep speculators from pushing the price too high right now, but if we see sustained turmoil in the Middle East (and we probably will) the price will remain at least at $100/barrel. Right now the major driver of price remains global demand; unless you want another round of recession, there's not much Obama or anyone else can do about it. Note that as I wrote the highest price of oil since the 1970s came in 2008 when George W. Bush was president (and that wasn't really his fault either.)

[Anonymous]

OK, I get it. Obama should continue to shoot his mouth off and it means nothing. In a certain sense there is a lot of truth to that, but I really think he is a very stupid, yes stupid, man to have ever suggested $8.00 per gallon gas is OK.

Since you are a pro, what is your opinion of the so-called reserves of oil/shale or oilly sand in the North central part of the country and Canada?

[jsteele]

Anonymous wrote:Second, Obama stated in campaign mode, "$8.00 per gallon gas was OK with him as long as the price did not increase too rapidly." Are you getting a clue now and the warm fuzzy feeling that goes along with it? Damn, I will never get the chance to study economics at Harvard; do you think he really did?
.

Could you please document your claim that Obama said he was ok with $8.00 per gallon gas?

[Anonymous]

I heard it without benefit of either blow or weed but will look for you brother.

[Anonymous]

Your mother doesn't sound very bright. It probably isn't worth discussing politics with her.

[jsteele]

Anonymous wrote:I heard it without benefit of either blow or weed but will look for you brother.

Based on your posts, I suspect you are rarely without the benefit of either blow or weed. I did a quick search and the only sources I found were websites like "www.obama-is-a-muslim-fascist.com" type of thing. I'm sure you understand that I have little faith in such sites.

[Anonymous]

Anonymous wrote:Your mother doesn't sound very bright. It probably isn't worth discussing politics with her.

OP here. That really isn't a very nice thing to say. You could disagree with her position without insulting her.

[Anonymous]

Obama: I'd like higher gas prices, just not so quickly « Hot Airposted at 3:20 pm on June 11, 2008 by Ed Morrissey printer-friendly. According to Barack Obama, high gas prices don't really constitute a problem for ...
hotair.com/.../2008/.../obama-id-like-higher-gas-prices-just-not-so-quickly/

Jeff, see if this works, computer limitations now.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Your mother doesn't sound very bright. It probably isn't worth discussing politics with her.

OP here. That really isn't a very nice thing to say. You could disagree with her position without insulting her.

These are not nice people here. They get surly when their ideas are challenged like little kids.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Your mother doesn't sound very bright. It probably isn't worth discussing politics with her.

OP here. That really isn't a very nice thing to say. You could disagree with her position without insulting her.

It is not an insult, just an observation. "No other President would have let this happen" is not a very intelligent thing to say. Presidents can clearly do very little to force down the price of oil, which is determined by global supply and demand (and expected supply and demand). In the short term the President could release oil from the reserve, but as the volume of stocks is a determinant of the oil price, it is not clear that this would bring down the price of oil even in the short term. In the long term, the best a President could do is reduce our dependence on oil, but this would involve measures like actually raising the price of oil through taxation, hence Obama's comment.

So people who say things like "no other President would have let this happen", or the various drivel the other poster is spewing out from his vaguely remembered right-wing news sources, tend not to be very rational. They argue on the basis of prejudice, and there is therefore a very limited return to trying to have a debate with them. But by all means, continue discussing this with your mother. Don't forget to come back and update us on how it goes.

[jsteele]

Anonymous wrote:Obama: I'd like higher gas prices, just not so quickly « Hot Airposted at 3:20 pm on June 11, 2008 by Ed Morrissey printer-friendly. According to Barack Obama, high gas prices don't really constitute a problem for ...
hotair.com/.../2008/.../obama-id-like-higher-gas-prices-just-not-so-quickly/

Jeff, see if this works, computer limitations now.

Doesn't work. It goes to a story that doesn't quote Obama, only paraphrases him not saying anything about $8 a gallon. It had Youtube video that doesn't play because the user's account was cancelled or something along those lines. You will have to try again.

[Anonymous]

The price of oil is global. We do not get sweetheart prices from American producers or American oil wells.

Look at the global price of oil and that tells you half of what you need to know.

Next look at our national oil output compared to the rest if the world. That tells you the other half.

We can drill baby drill all day long and It will be a drop in the bucket. That's a fact.

OPEC and producer political stability sets the price of oil. AnyOne in the industry who is not a corporate mouthpiece will verify this.

[Anonymous]

jsteele wrote:

Anonymous wrote:Obama: I'd like higher gas prices, just not so quickly « Hot Airposted at 3:20 pm on June 11, 2008 by Ed Morrissey printer-friendly. According to Barack Obama, high gas prices don't really constitute a problem for ...
hotair.com/.../2008/.../obama-id-like-higher-gas-prices-just-not-so-quickly/

Jeff, see if this works, computer limitations now.

Doesn't work. It goes to a story that doesn't quote Obama, only paraphrases him not saying anything about $8 a gallon. It had Youtube video that doesn't play because the user's account was cancelled or something along those lines. You will have to try again.

He said: "I'd like higher gas prices, just not so quickly" and a level of 8 dollars would be OK.