Driving anywhere these days has become such a hassle in that the price for gas is rising higher than expected. Everyone is being effected by it and something needs to change. The republicans have the right idea but the democrats are holding everything back. Bush is currently trying to lift the moratorium his father set out that made it illegal for the US to drill for oil on our own land until 2012. That alone would make the price for gas drop.
The cost for one barrel of crude oil last year was about 70 dollars. This year it has gone up to 140 dollars. Has the cost to produce the oil gone up? No it hasn't. The reason the price is so high now is because of "gamblers". People that are buying and selling oil that they will never even touch in the futures market. Since people think the price of gas is going to go up, they are buying the oil futures which in turn causes the price to go up. These speculators are guessing about the future and that drives the price up.
If Bush were to drop the moratorium then all of that oil we haven't been able to drill would then become available. Since it is available, all the people who have futures in oil are going to think that the price for gas is going to go down. If they think its going down, they sell all of their futures and the price does go down.
All this being said, the rising gas prices might actually be a good thing. The SUV dealerships are unable to sell their gas guzzlers and electric car companies now have a reason to improve the making of their cars. I know the rising prices are a hassle and dropping te moratorium is an easy solution, at what price would it be worth it?
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4 comments:
When I wrote my blog on the soars of gas prices I only saw one point of view. I only talked about how manufactuers of cars need to reproduce cars faster so people can afford to live. That is really not the only issue and your post made me see that. The government has a huge role in deciding what should happen and I like how you mentioned the republicans and the democrats because that made me look at where the problem really falls.
Bush planning to drill for oil could have a huge deciding factor on whether gas prices are lowered or not. It could most definitely go either way.
I have thought about the manufacturing of new cars but then realized that gas prices need to lower before that even happens. People obviously cannot afford to go out and purchase a new car(even if it will save them money in the long run) it is not reality and I realize that now, after I posted my blog.
Your blog made me look at the complete other side and that is sometimes exactly what everyone needs.
I'm going to have to agree with you about the people buying up all the gas notes. I read an article saying that Congress "was going to investigate" the buyng of gas compainy shares. I'm sorry but instead of wasting their time investigating they should be finding solutions for the American families. The effects of gas prices are placing an even bigger strain on house holds. With rising gas prices come rising food prices, rising shipping, air flights, ect. Our country, if nothing is fixed, will see another depression. Right now we're fighting to stay above water but eventually more and more people are going to start to drown in the never ending gas price war.
I too would love to see production start in the coast but the fact that an alternative fuel or engine needs to be produced for the mass population to use because our supply of gasoline will one day run out and then where will we be?
President Bush, alongside with his Republican allies, seeks the approval of an off-shore oil and gas drilling proposal which the congressional Democrats continue to reject. The party’s opposition is reasonable given that Bush’s plans to drill for oil on U.S. federal lands will not affect the rising prices or the intensifying demand for oil quickly enough. The underlining issue is that the United States’ energy crisis is now. Off-shore drilling will not even begin to lower the sky-rocketing prices of gas today until many years (probably over a decade) from now. That is why there needs to be alternative gas and oil source, which the Democrats have proposed.
Another issue is that Congress is also wary of Bush and Cheney’s dealings with "Big Oil" companies. As Republican Chris Murphy stated, "The president should stop doing long-term planning for oil company profit-making and start doing short-term planning for American families," and agreed in the Congress’ decision to reject Bush’s oil plans. "For the president to call for new drilling on new and fragile lands when oil companies already do not use more than 75 percent of the acreage they currently have under lease is ludicrous," claimed Democratic Sen. Chris Dodd.
President Bush has not proposed anything new. Yet, this is exactly what America needs: New sources of renewable energy and methods for more efficient means of transportation. But, this too, will only come with time since the technological advancements are still lacking on developing alternative sources. Do we just keep waiting around for gas and oil prices to magically drop?
Well, oil futures (which have likely aided in the rising cost of gas and oil) can help our nation’s energy dilemma sooner. Barack Obama announced a four part plan which would “crackdown” on speculation in the oil futures market and to fully close the Enron loophole. His proposal calls for the regulation of U.S. oil futures and working with other nations to regulate the global oil futures trading market. Also, he proposes to eliminate the 30% of U.S.’s unregulated oil futures and to investigate price manipulation in the oil market. Obama's plan could be quite effective in solving atleast this issue.
So, there are options (none are necessarily right or wrong), but few which deliver the needed results in the shortest amount of time. I think that Congress is overlooking Bush's proposals not due to partisan reasons, but because there are still other options to consider. Yes, there may be some advantages from our nation's fuel shortage, the rising prices of gasoline are increasingly overshadowing them.
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