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Hey! Remember 2005, when you thought that two bucks a gallon for gas was a *lot*?

By: Moe Lane (Diary)  |  July 29th, 2008 at 08:23 AM  | 

RESIZE: AAA

You do?

Well, go remind people, then. Be sure to also ask if they miss that $2.20/gallon that we were enjoying at the end of 2006, back when the GOP was still running Congress. And when you’re done with that, ask ‘em what they think that the price of gas is likely to be after two more years of Democrats running Congress.

Moe Lane

PS:

NRSC.
NRCC.

Pay to play, ladies and gentlemen. Pay to play.

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COMMENTS

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  • NightTwister

    Gas Prices

    Now, if I were a liberal, I’d be really concerned about a graph that looked like a hockey stick…and I’d surely want to make sure everyone knew that we have to do everything possible to reverse this trend.

  • micscottj

    While i believe in free markets and trust supply and demand, this chart is pretty much proof that supply/demand is not the only factors at work here. if it were the case, then prices would have risen gradually as demand increased. Demand was not flat for 10 years and then increase 300%.

    I certainly don’t believe oil companies are to blame though. While they don’t mind the price increases, they don’t have the power to make that happen. Even if they did, it would require such a massive effort it could never be pulled off without someone letting the cat out of the bag.

    This leaves us with the speculators. Speculators have clearly ran the prices up over the years. Everytime a potential supply disruption occurs they scream that the supply is in jeopardy and the prices of oil jumps. This is why drilling now is so important. If we would just removal all the governmental constraints on our domestic oil, the price would drop like a lead balloon. I suspect a massive selloff would occur and prices would get back in line with supply/demand.

    And for the record, i hope the specs take a bloodbath from the selloff. They will deserver everything they get. Of course, that will probably cause congress to promptly setup another bailout.

  • Flagstaff

    The per gallon price was $2.699, and I saved 10 cents per gallon by shopping at Fry’s, bringing my price to only $2.599.

    It was possible tonight in Flagstaff to buy gas at the discounted price of $3.779 per gallon.

    I can remember during the mid-seventies when I thought 45 cents per gallon was a lot (in Michigan).

  • Flagstaff

    I know the “speculators” make convenient whipping boys, but if it were their fault, why isn’t it still going up?

    All those who were blaming them last month, saying they were “manipulating” the markets, where are you now? Did the speculators forget how to manipulate? If it were so easy, why weren’t YOU getting in on the action?

    Consumer prices are affected by a gazillion things, and commodity prices also tend to have a momentum component. Somewhere in these pages, a few weeks ago, I predicted that once the price of oil started to drop it would keep dropping for a while, even if the drop were just the result of lifting the executive ban on offshore drilling. (I know that’s an easy prediction–but everybody at the time was talking about no end in sight for higher prices, and that the speculators were stealing from us by driving prices higher.)

    The fact that a market is truly unpredictable and responds to real supply and demand is what makes it a market. Otherwise, it would be a command economy and we’d be sitting in lines at the gas stations or trying to get rid of surpluses of BetaMax video recorders, or trying to figure out how to make those Betas play the DVD’s that the rest of the world is using.

    It may be true that the futures market was where oil prices shot up, but that was because so many traders believed (like most everybody) that prices would be even higher for the next contract. And they were right–for a while. Then they were wrong, and a lot of them will lose on the way down much of what they made on those last few contracts on the way up. But they won’t lose it all, and those losses are part of the cost of doing business for them.

    You wrote,

    Everytime a potential supply disruption occurs they scream that the supply is in jeopardy and the prices of oil jumps. This is why drilling now is so important. If we would just removal all the governmental constraints on our domestic oil, the price would drop like a lead balloon.

    I think you’re right. If we are producing more on our own, it wouldn’t completely stabilize the price of oil (being a world market), but it would dampen the effect of those crisis-based price spikes, and we would also benefit from them as much as they would hurt us.