What are the specific reasons? Did consumption go up? Did Supply go down? BP Oil Spill? Libya's War? Rocket River
Edit: Forgot the topic that explains it: http://forums.somethingawful.com/showthread.php?threadid=3396041
Yep, speculation. Another way rich Wall Street types are "stealing" from the poor, to use the parlance of our times.
**** going down in Libya doesn't help. Japan lost lots of power generation capability, so they have to rely more on fossil fuels. Dollar losing value hurts a lot too.
I know this may shock some of my conservative brethren, but the first answer truly is speculators. There is a right and wrong view on Wall Street right now that oil is going to become a much more scarce resource in the very near future. So buy low, and sell high. So the question becomes, why are the speculators speccing the price of oil. Right now there are several reasons. First, the unrest in the Middle East. When the dust settles, no one really knows what the ME will look like. The ME may not continue its oil production levels if more radical regimes take over. Second, alternative energy sources simply aren't coming along fast enough. It still takes about a 50% or more government subsidy for most true energy alternatives (solar and wind) to be economically viable. I really do believe that in the long run, green energy could be the energy answer we're looking for, but the technology is still much too expensive. Lastly, the Federal Government has created a false scarcity with its exploratory regulations and permitorium. Speculators see the hostility that the current administration has toward traditional fossil fuels. For the next two years, there will be no real expansion on exploration and refining capacity in the US, leading to probable scarcity. Oil become a good way for speculators to make money. A lot of people will argue over the steep decline in oil prices, but you can't argue that when Bush announced that he was going to end the coastal drilling moratorium in 2008, that the bottom didn't fall out of oil speculators. Now, there were absolutely other factors, but by removing the false scarcity, the government pushed the speculators into retreat.
There is nothing wrong or insidious with speculating. Why would you not consider future value when making a purchase? Are we supposed to wear blinders and make decisions in the present without "speculating" on what the future holds? Speculators take it in the shorts just as often as they make it big, like anything else. Anyone with a brain "speculates".
I should add, what's truly insidious is when governments use bailouts and tax dollars to mitigate the risk to these speculators.
bull crap from the last oil inventory report. yeah, other factors like um i don't know a complete economic collaspe with the stock market dropping almost 50%
i dont know about the rest of you... but america is not meeting my needs right now. i'm a pissed off middle class american. cost of living is rediculous. i get squeezed for $$ around every corner. and gas prices are just one of the problems.
It's a supply the sad part is if a high supply comes from drilling, they cut back on drilling that's what happen in 2008 when we actually started getting control ov the issue.
so why are we propping up the banks again? Oh yea, because if they aren't allowed to keep screwing us over, the economy will collapse.
If the price of corn or cotton or copper goes up too high for me, I can easily buy something else. Most commodities have an alternative, they're not integral parts of what is necessary for transportation in this country. This has a double down effect as well. When the price of corn goes up, products that are made from corn go up. When oil goes up, the cost of every transported good in this country goes up.
