Gas Prices Skyrocketing

Most analysts predict gas to go to $4 per gallon this year (guaranteed in California). So what is the cause? Middle East unrest? Decreased oil production? Shortages? How about Fear and uncertainty fueled by the Obama agenda.

Speculators are like scared lambs. With millions of dollars on the line daily, any kind of potentially disruptive world event can affect oil prices. We saw that with the Egyptian situation. Prices spiked on fears that the Suez Canal could be compromised. We saw it with the BP oil spill last year. We saw it once again with the illegal moratorium imposed on drilling in the gulf. At least the libs are happy with Egyptian events for the time being. Life is starting to return to normal along the gulf coast. A judge has ruled that Obama had better get his hands off those rigs in the gulf. Yet prices are rising.

I paid $3.43 today for the cheapest off-brand crap I could find. That’s up from $3.35 a few days ago. At one point last week, the price rose almost 10 cents in a day. This, despite the fact that oil prices are dropping-in fact, crude prices on NYMEX are at its lowest point in three weeks. Not only that, there is a gasoline glut in the country.You saw that right, a glut. The Energy Department is reporting gasoline supplies are at more than 236 million barrels, the biggest glut since 1993. In other words, there is no shortage of fuel. Yet the price rises.

We can speculate with the speculators at what is driving the price spike. Unrest in the Middle East has spread, but even with that, it wouldn’t justify such a price hike. Besides, even though we get way too much oil from the Middle East, the majority of it comes from Canada and Mexico. Keep in mind, analysts have been predicting these kinds of prices for months. That brings us to Barack Obama. The illegal drilling moratorium has no doubt cost oil companies millions of dollars in potential revenues, and like any company, they will look to recoup those losses anywhere they can. Speculators see that, and it drives the price of gas up. Keep in mind that most of these oil giants are also in the gas selling business. Then we have Obama’s budget proposal. He wants to eliminate tax incentives for the oil companies. Like I said, any company will look to recoup those losses, and oil companies are no exception. Oil companies are no angels, but they aren’t idiots either.

Then we have the production side. Limited refining capacity will in and of itself drive up fuel prices. We also have a glut in raw crude. It’s being shipped down from Canada, but the companies don’t have the logistics or the facilities in place to do anything with it. They probably have no plans to do so either. After all, they can only speculate themselves what Obama will do next. It makes no sense for them to invest millions in refining capabilities, only to have Barack Obama tell them they can’t use those facilities.

Domestic drilling and expanded refining capacity will bring down the price at the pump. Obama doesn’t want either one of those things though. As long as this guy is in office, the only way gas will come down is if people stop driving. And isn’t that the plan? Unfortunately for America, these high prices will cost jobs. Companies will have to factor rising prices into their expenses, and if that means paring off jobs in order to stay relevant, then that’s what will happen.

Gas prices are artificially high. We have plenty, and we have the opportunity to produce more. There are plenty of factors that go into the price of oil, but what we are currently experiencing are high gas prices. It doesn’t reflect the current oil prices. Who can we blame for that? I just gave you my theory.