gas

[[AK]Camelwalk]

So today I filled up my gas tank and the total came to $40.36 for 17 gallons of gas. The whole time I was filling it up I did not think that this was a political issue or that the president was responsible for this. You here on the news that this is a issue and the pres. might lose because of this. Is my thinking wrong? Is this actully the pres. fault? Imnot a big time politcal gent but this does not seem right. Is it not OPEC that choses the prices, and is that not who we arefighting all around the world, I mean arabs. So why wouldn't gas be higher because they dislike us? Can someone help me with this!

[[AK]Hylander]

Opec does not set prices per se. Gasoline prices have many variables. OPEC does control a very large percentage of the oil that is pumped into the system, so in a way they can 'set the price' by controlling the supply end of the equation. But, in recent times there are really two large factors playing part. The first being China. The Chinese economy is growing at a large clip and demanding large amounts of fuel to meet demand. Thus, the entire demand for oil is up and pushing prices on the market up. Second, the speculators and those who buy futures also push up the price of the oil. For example, Southwest Airlines purchased about 85% of their fuel needs in 2003 to cover 2004. They purchased futures to lock in the price of their 2004 fuel in 2003 pricing. (Extremely smart move). The general options market also plays a part with speculators gambling on rising costs of oil. Combine all the factors and it pushed the price of oil up.

OPEC could obviously pump more barrels per day, but that alone would not solve the problem. Another huge problem is not so much the demand for crude oil, but the fact that the Environmental Terrorists have blocked American Oil Companies from opening new refineries to produce marketable gasoline. So even if OPEC created a huge surplus (which they don't have a huge capacity to do at the moment) of oil into the market, it would push crude prices down - but it would not necessarily result in wholesale falling of the price of gas because oil companies do not have the capacity to turn that crude into marketable fuel in the short run.

It's a complex issue, and I just used a generalization as I'm no expert, but I did read a pretty lengthy academic paper written on the subject in The Economist recently. But take it for what it's worth as I did not stay at a Holiday Inn Express last night. ;)

[[AK]Camelwalk]

My question is how does this affect a pres election. I heard on fox news by a left wing columist that this is pres. Bush fault and all the people will remember is gas pricess when they vote. There are a lot of factors as you pointed out so why blame him? I dont, do you?

[[AK]Hylander]

Well of course I don't, but again - for a lack of a better word - there are a great deal of 'sheeple' out there who hear 10 sec. tag lines on the evening news, most that are misleading toward a negative context associated with President Bush, and take it as fact. You aren't going to get a full explaination or examination of the topic on the news or in the paper.

Others will use it just as another excuse to justify their hatred of President Bush, simply because they are 'leftist' or liberals. It doesn't matter if it's based on fact or not, as long as it's something negative they can attach to.

[[AK]JD]

Consider yourselves lucky. Up here in Canada its $0.99 per litre which works out to just under $4.00 per gallon !!!! I cringe when I fill up my truck, which is now over $80 per tank..