It tells you all you need to know.
With gasoline consumption trending down, motorists wonder why price keeps rising
Yeah, why are gas prices rising at a time of year that they are traditionally lower than normal?
Well, if you give it some thought, I believe you will come to the same conclusion I have: that this is a rhetorical question.
We know that certain large, wealthy and influential business interests have an “interest” in not seeing President Obama re-elected, or at least keeping Democratic gains at a minimum, especially in the House of Representatives, for a number of reasons, despite the fact that the profitability of these businesses has performed very nicely over the past 3 years, thank you very much. Nevertheless, these profitable business interests would prefer a Republican in the White House.
These businesses also have the ability to effect the availability of gasoline and the price that you and I must pay for it, keeping supply low so prices will continue to rise. Higher gas prices means upset consumers, many of them who are also voters. Upset voters tend to blame the President in office and his party for the state of the economy.
Shawkat Hammoudeh, an economics professor with Drexel University in Philadelphia, has another measure: Crude oil hitting $120 a barrel “means about 0.5 percent will be cut from economic growth in the first year of a budding economic recovery.” […]
Hammoudeh said the “typical American household spent $4,155, or 5.7 percent of its budget, on gasoline in 2011. If higher oil prices continue and the consumer is not able to adapt, a reduction in spending on non-discretionary goods and services will follow.
“If this scenario takes place, then the (U.S.) economy will suffer from a spending reduction that affects 70 percent of the economy,” he said.
Do you wonder why the Neocons are being trotted out to hype a war with Iran even though Iran is not an imminent threat to any country in the world, including Israel? Do you winder why US refineries had record production of gasoline in November but most of that increase went to exports despite the demand in the US market? Would you be surprised to learn that Wall Street speculators have been driving the price of crude oil up?
WASHINGTON — U.S. demand for oil and refined products — including gasoline — is down sharply from last year, so much that the United States has become a net exporter of gasoline, unable to consume all it makes.
Yet oil and gasoline prices are spiraling upward. […]
While tension over Iran has ratcheted up in the past few months, oil and gasoline prices have leapt far beyond conventional supply-and-demand variables. Financial speculators are piling into the market, torquing the Iranian fear factor into ever-higher prices.
“Speculation is now part of the DNA of oil prices. You cannot separate the two anymore. There is no demarcation,” said Fadel Gheit, a 30-year veteran of energy markets and an analyst at Oppenheimer. “I still remain convinced oil prices are inflated.”
Gee, I wonder what happened to the invisible hand of the free market? Well to be honest, I don;t really wonder about that at all. You see, we’ve seen these types of “games” before in election years. For example, wasn’t it funny how in both 2004 and 2006 oil prices declined significantly in the run-up to the November elections at a time when lower prices would presumably benefit Republican incumbents.
I guess that invisible hand prefers Republicans to Democrats for some reason. Which is why we can expect a spike in gas prices this summer and fall, just when certain “persons” of non-human origin can run ads attacking Democrats for screwing up the economy. Oh and don’t call that statement a prediction, please. Call it my trend analysis of market fundamentals. Not a free market, mind you, but the real one where you have to pay to play. Unlike the rest of us who just have to pay and suffer the consequences when large corporations and Wall Street financiers manipulate the economy to obtain political gains favorable to their interests, not ours.
