The Price You're Paying For Gas Isn't The Real Price It's The Price Wall St Believes Oil Will Reach

[democracy1st]

Run time: 03:05 https://www.youtube.com/watch?v=-M4e9vgOFTQ   Posted on YouTube: April 19, 2011 By YouTube Member: MoxNewsDotCom Views on YouTube: 229   Posted on DU: April 19, 2011 By DU Member: democracy1st Views on DU: 2040

 
Oil Speculators A Main Cause Of High Fuel Prices



Nelson, other senators urge curb on oil speculators
By William E. Gibson, Washington Bureau
March 17, 2011

Florida Senator Bill Nelson and a dozen of his colleagues urged federal officials on Thursday to use new regulations to curb speculators from driving up gas prices.

“Speculators are seizing on recent political turmoil in North Africa and the Middle East to drive energy prices to unwarranted levels,” the senators wrote to Gary Gensler, chairman of the U.S. Commodity Futures Trading Commission.

Joining Nelson on the letter were Sens. Maria Cantwell, D-Washington; Barbara Boxer, D-Calif.; Al Franken, D-Minn., Jeff Merkley, D-Ore.; Patty Murray, D-Washington; Robert Menendez, D-N.J., Mark Begich, D-Ark.; John D. Rockefeller, D-W.V.; Carl Levin, D-Mich.; Barbara Mikulski, D-Md.; Sherrod Brown, D-Ohio; and Bernie Sanders, I-Vt.

Republicans were asked, but they declined to sign the letter, Nelson’s staff said.

http://www.teamster.net/topic/55968-oil-speculators-a-main-cause-of-high-fuel-prices/



Gas Prices:
http://gasbuddy.com/

[Rhiannon12866]

1. K&R! We've reached the tipping point here in NY, $4 for regular.

Well, it's actually $3.99.9 at most stations today. :(

[LAGC]

2. Once good thing about these higher petroleum prices...

Is that bio-fuels are really going to take off soon.

The oil companies won't be having the last laugh...

[Rhiannon12866]

4. That would be the only good thing to come out of all this.

And NY is only 5th highest in the lower 48, behind California, Alabama, Illinois and Connecticut. It's not over yet, either, since prices have been rising steadily and prices always go up when they switch to the summer blend. I put $40 worth of gas in my car last week and it only went to three-quarters, and it still had a quarter of a tank. During the winter, I'd get change back from $30, and that was to fill the whole thing. :(

[Duppers]

8. bio-fuels are a good thing??

Aren't they also bad for the environment and drive up food costs?

:shrug:

[LAGC]

16. I was thinking more of algae-based bio-fuels.

They've already had success in 50-50% algae/petroleum mixes.

I agree the corn-based ethanol drives food prices up.

But some scientists think the algae-based stuff might eventually be as cheap as $1/gallon! Talk about reviving America's mobility!

[Rhiannon12866]

18. I also wish I could avoid ethanol.

It not only affects food prices, but it's bad for your car. :grr:

[Duppers]

21. Thanks for your help!

I had forgotten about the algae-based bio-fuels. Now, I agree with you. :)

[napoleon_in_rags]

3. Sucks to see both my senators signing on.

The global warming/peak oil superheros, charging in to make sure everybody burns more fossil fuels.

I hate to give good people bad news, but we're running out. The speculators are the people with the foresight to see it. Oil will be a precious commodity in decades to come and forcing artificially low prices now will only increase them later, along with increasing pain on an already overburdened future generation. OF course its driving the presidents poll numbers down. So he loses, and republican gets into office in 2012. It will only get worse, the prices will keep rising, and somebody will vote them out. Yes there are speculation driven bubbles, but I don't think this is ultimately one of them. The bubble that has popped is the idea that stable "normalness" from the 90s is ever going to return. Its time to think about changes.

[farmboxer]

5. Wall Street is raising the price of food also.............

someone should do something..........Clinton had DOJ to investigate oil prices and it worked! I guess Holder is only concerned about the sick and dying being prosecuted for using medical marijuana.............

[napoleon_in_rags]

19. Food is a different beast:

Its a renewable resource. If Richy rich buys a huge amount of rice, the price will go up. Because the price has gone up, more farmers will plant and there will be more and lower prices next years. So if you want to introduce legislation to stop short term food cost spikes, be my guest, but that's all they will ever be: short term spikes because the market will compensate (over the period of a full planting cycle) for the higher prices.

Oil is a different beast. Its like a big barrel of whiskey with a spigot. OPEC "increasing production" doesn't mean they are making more whiskey, it means they are increasing the size of the spigot. You can pretend its like rice for awhile, but eventually people get wise to the fact that the barrel only has so much. At this point buying up a lot of whiskey, unlike buying up a lot of rice, becomes a very profitable idea in the long term.

[fasttense]

13. It's just another bubble. This too will pop and crash.

Ravi Batra predicted this bubble when the recession 1st hit. Since we have rescued the uber rich, they have to find a place to park all their unnecessary money. (They don't need to spend it, they have everything they need or want.) Since the CDOs and other mortgage backed crap is known to be worthless, they need something solid and real. So, speculators are buying up gold, oil and other commodities. Simply put, with the help of the bailout, they are re-inflating the bubble.

This link was posted on DU and is very informative: http://www.consortiumnews.com/2011/041911a.html

"“That’s how we have developed a massive glut of 677 million barrels worth of contracts in the front four months on the NYMEX and, come rollover day – that will be the amount of barrels ‘on order’ for the front 3 months, unless a lot barrels get dumped at market prices fast.

“Keep in mind that the entire United States uses ‘just’ 18M barrels of oil a day, so 677M barrels is a 37-day supply of oil. But, we also make 9M barrels of our own oil and import ‘just’ 9M barrels per day, and 5M barrels of that is from Canada and Mexico who, last I heard, aren’t even having revolutions.

“So, ignoring North Sea oil, Brazil and Venezuela, and lumping Africa in with OPEC, we are importing 3Mbd from unreliable sources and there is a 225-day supply under contract for delivery at the current price, or cheaper, plus we have a Strategic Petroleum Reserve that holds another 727 million barrels (full) plus 370M barrels of commercial storage in the U.S. (also full) which is another 365.6 days of marginal oil already here in storage in addition to the 225 days under contract for delivery.“

These contracts for oil outnumber their actual delivery, a sign of speculation and market manipulation, as oil companies win government authorizations for wells but then don’t open them for exploration or exploitation.

It’s all a game of manipulating oil supply to keep prices up. And no one seems to be regulating it."

There is so much oil out there, they can no longer store it in the US.

But Obama says he can't do anything about it except to drill baby, drill.

[napoleon_in_rags]

20. I gotta be honest here, you're not seeing what I see.

And the article I linked to doesn't even address the real issues to me. Its true for instance that the unrest in the middle east is not raising oil prices, that's an excuse designed to settle markets. Here's the broader picture as I see it, a thumbnail sketch.

For a long time America has subsidized excessive domestic food production. Its a good policy, probably dates back to around the depression... But its designed to make sure that in the advent of serious disaster, economic or otherwise, the infrastructure exists domestically to feed the people of the US. All the extra food produced is sold on international markets, some given away as aid. So its a good policy, food security for the people, extra feeds the poor overseas. A side effect of this policy though is that rising food prices on the global market is often a "canary in goldmine" for serious problems in the US nobody is talking about. That's exactly what's happening here.

In the years immediately leading up to the current unrest in the middle east, ethanol production climbed exponentially to supplement gasoline and attempt to contain rising fuel costs. Recently, 30% of our corn crop was going to ethanol for instance. This combined with mild decreases in agricultural production in the US (and other food producing nations like Russia, due to increased cost of energy) contributed to a significant increase in food prices on the global market. This increase in food prices led to large scale unrest in food importing states, such as the desert regions of the middle east where food cannot be easily grown, the so called "Arab Spring".

So here's the big picture: The fact that the world is running out of oil is what led us to convert our food to ethanol to prop up our economyl, is what led to more expensive food on global markets, is what led to unrest in the middle east. The unrest is a symptom of running low on oil. And we in the mighty US are running low on oil because the world is running low on oil. You seem like a smart guy, I doubt I have to tell you to Google "peak oil". But maybe you should anyway.

So given that picture, where do these oil speculators stand? Look at the alternative: World governments agree to intervene to tap the last remains of the big wells, artificially forcing prices down. So instead of a gradual decline down the slope, we fall off a cliff when we run out. Nobody is any better off.

You're right that maybe the prices will come down again for awhile, but I can tell you one thing: The nature of a bubble is people believing in a delusion, and the chief delusion we are dealing with here is that oil is a renewable resource.

PEace.

[dotymed]

23. I agree that we are running out of petroleum, I do not agree

the "speculators are the people with the foresight to see it."
I'd say they are the ones to manipulate this fact to their great advantage and make huge profits from it which help further destroy our economy and make them (speculators) wealthier.
Sadly, that is what our society has devolved into. Instead of helping our fellow men/women, the wealthy find every way to exploit us, no matter the harm. Even if left on their own the oil prices would continue to rise (at a slower, less harmful pace) which SHOULD give our government the stimulus it needs to invest in the R&D and production of alternatives (wind, solar, etc..) to put Americans to work (living wages only please), to make our country the leader in a growing field once again and to improve our economy.
Of course, the wealthy who control our government would never allow this to happen. All alternatives will have to be produced for slave wages to increase profits. Also, this will not happen on a large scale until they have bled every cent from us for petroleum and (again) huge profits.

[Citizen Worker]

6. Will the high cost of getting to work finally force the working class to STRIKE!

[Hawkowl]

7. 75% Capital gains tax

A high capital gains tax along with high interest, dividend and estate taxes would solve this problem. Another way at curbing speculation would be to disallow buying future contracts on margin. Or a % tax on each and EVERY transaction.

Greed is killing the planet.

[dotymed]

10. Yes, these ideas are vital and not new.

Before Bush II, most these methods were used very effectively to lower gas and other prices. Of course, with the wealthy controlling the economy for the last 12 years (more than they used to be able to get by with) these proven methods are not even considered. Hell, they have gotten Americans used to the idea of being financially raped on a daily basis. They do not fear us. They own most of Congress and the other branches of government and they know they are above the law.
A Revolt by the American people is the only chance we have. They have made most of these changes gradually, so most people think "this is the way it's always been."
No it's not. Just before Bush II stole the election, these "laws" would have been answered with (at least) a prosecution. Now our government has ceded all regulatory power to the wealthy, politician owning, elites; and it is destroying our country and economy.
What are we waiting for? At this rate we will be totally unable to fight back in our ongoing class war. The war that we have seemingly already ceded to the wealthy.
We have become a nation of pathetic whiners, unable and unwilling to stand up for our rights and those of our children.
Of course, we do not stand a chance of winning an armed revolution against TPTB. Our only hope is to stage a peaceful fight against these people(?), we out number them, millions to one...
The man I thought would lead us in this revolution against TPTB has disappointed me terribly. I thought that a President Obama, would be for regular Americans. So far, to me, his policies have followed those of Bush II....

[chervilant]

15. Consider

that the 'whining' you denigrate is the ever-increasing grumbling of the hoi polloi, as we awaken to the reality of the Corporate Megalomaniacs' proverbial boot clamping down across our necks. These vile corporatists are daily increasing their stranglehold on our lives and our livelihood. We may seem to be milling about in chaos right now, but that will change. It has in the past and it will in our immediate future.

Our species has reached critical mass. The decisions we make RIGHT NOW will determine whether our species continues to evolve into the erudite, peaceful and creative beings we KNOW we can become; or devolve into the ignorant, aggressive, and fearful beings we vociferously deny being now and in much of our past.

[HolyCity2012]

9. abandon the suburbs

Higher gas prices will lead to more demand for mass / public transportation. Start riding your bicycle move closer to work. Move your work closer to you. Our American lifestyles of SUV's, riding lawn mowers, fresh fish at the super market everyday etc, etc, is all completely unsustainable. We all need to simplify our lives and stop buying everything these corporations have for sale.
__________
How we became slaves to oil
http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=385x563940

[eilen]

12. Unfortunately, the real estate market sucks

and it is very difficult to sell. I'll be riding my bike soon. Luckily the local community college has a satellite around the corner and my son could walk or bike there in the Fall (it's actually closer than his highschool.

I wish our town would push for sidewalks on our easements to make it easier for kids to walk to school and around the neighborhood in the winter. I wouldn't even mind if they narrowed the streets a little, it would slow the car traffic.

[florida08]

11. `

[Marblehead]

14. No mention

of the falling value of the $

[HolyCity2012]

17. THE END OF SUBURBIA

Oil Depletion and the Collapse of The American Dream

"We're literally stuck up a cul-de-sac in a cement SUV without a fill-up"
- James Howard Kunstler

http://www.endofsuburbia.com/previews.htm

[MrObama]

22. Gas prices are high because BERNANKE PRINTING MONEY & ZERO FED RATE!!

Fed is Fueling a credit & asset bubble. This is not a recovery. The mother of all bubbles will Pop. Only the timing is in doubt.