Remember Hurricane Katrina? Remember how oil prices spiked dramatically afterward? Fast forward to today… Oil prices dropped below $100-a-barrel for the first time since April 2, more than 5 months ago. Interestingly, this low coincides with some rather interesting news events.
- The recent Russian invasion of Georgia (Russia is a major producer of oil), causing strained U.S. relations, and threats of war.
- Hurricane Gustav which caused the shut-down and evacuation of oil-rigs and refining operations in the Gulf of Mexico and surrounding areas.
- Hurricane Ike which is today pounding the Texas coast, and has once again, caused the shut-down and evacuation of oil drilling and refining operations in the Gulf.
And yet, oil prices are falling. Say what?! How is this happening?
Well, one thing is for certain. High gasoline prices have resulted in a drop in gasoline sales. If you couple this with optimism over increasing future supplies, you’ll have a price drop.
Okay, I’ll get to my point. John McCain has recieved a huge popularity boost as a result of selecting Alaska Governer, Sarah Palin as his vice presidential running mate. Both Governer Palin, and Senator McCain are in favor of expanding domestic oil and natural gas exploration and production. At the same time, presidential hopeful Senator Barack Obama wants to focus on taxing oil companies, and bribing Americans with free money in the form of Energy Rebates while he scrambles to achieve energy independence through alternative green energy technology.
Okay, so McCain/Palin is for increasing oil supplies, and Barack/Biden is against it. McCain/Palin is ahead in the polls, and might end up being the next presidential administration, while Barack repeatedly shoots himself in the political foot every time he opens his mouth. (I saw him on TV and it looked like he was wearing lipstick! What’s up with that?)
For those who might not know, oil prices nationwide are set on the futures market. Suppliers and distributors buy and sell contracts for given quantities of oil. The prices are negotiated according to what they believe they will be able to sell that oil for at some point in the future. If it is believed that oil will be readily available, and inventories high, the price of those contracts (sold today) will have to be lower.
Could the prospect of cheap future oil be driving down the oil futures market prices today? Absolutely! Now, given all that’s been going on, what reason would oil futures traders have for being optimistic about oil prices in the future?
Could it possibly be the success of McCain/Pailin?
I wonder.
A well informed post. I wonder too.
Though McCain, is not a constitutionalist, and I don’t love him, I think he chose well.
Heaven help us, if the Barako gets elected.
I know I can’t afford it.
Lisa M, I agree. Sarah Palin is the only candidate in this election that doesn’t believe that the role of government is to be a babysitter to the people. Unfortunately, Obama and McCain both see the constitution, and it’s Bill of Rights, as an obstacle, and we the people, as idiots who need to be managed, and controlled for our own good. I don’t much care for McCain, but Sarah Palin was a brilliant pick! Obama, on the other hand, is obsessed with disarming American and wants to create a huge national police state. Truly, I have never seen a person so hostile towards liberty, and the American way, as Barack Obama. Of course, the whole concept of a free society kind of throws a wrench into the works when your goal is to control everyone and every thing. It’s pretty astonishing that so many people have bought into his “hope and change” mantra, and support him with passion, and yet have no concept of what his actual policies are. He makes everything sound wonderful, until you realize that it’s all fluff, and that he hates you, and everything you do.
I SO hope so! I would really love to have McCain/Palin win! Great post!
Me too melissa c! I hope Sarah Palin becomes the President some day. Actually, I think the ultimate ticket would be Sarah Palin and Senator Kay Bailey Hutchison from Texas. They’re both awesome!
I liked this post a ton but am commenting here with a suggestion…. I want your take on this Hurricane Ike thing, have you noticed that the people who stayed behind with Hurricane Katrina were victims that the govt. did not help and now the people in Texas are idiots who ignored the warning and evacuation orders. Do you think this was because Katrina hit a democratic area and Ike hit a republican one??? My husband posed this question to me yesterday and I have been thinking about it but would love to hear you put my thoughts into the words I can’t come up with>>>
Hey Pea! Ahh, you give me too much credit. I know I’m not qualified to represent your thoughts, but I take it as a big complement that you think I could! It’s funny you should ask about hurricane Ike vs. Katrina, because I just got through reading a book on the New Orleans / Katrina disaster from a civil rights perspective (“The Great New Orleans Gun Grab”, very eye opening book!). I’ll think about this, and see if I can come up with a new post or something. Oh, and THANK YOU THANK YOU for the suggestion! I’m totally new to this blogging thing, and I have a hard time thinking of what to write about. Awesome!
I am a Sarah Palin Support and this wouldn’t surprise me about her at all. I really enjoy reading your blog, Paul, You are very good at expressing yourself through writing.