6 Myths About Oil Speculators

Speculators can push any market around. But the trend in oil prices is going to be up, speculators or not. Yeah, they all may panic out, causing a temporary dip, but with China, India, and a bit later Africa all heading for oil addiction, the prices are going to stay up long-term. It's a limited resource. I doubt we'll ever see $1/gallon again.

Think about it: 1.3 billion Chinese and 1 billion Indians are just entering the auto/industrial/manufacturing age. Not only is auto usage skyrocketing, but use of petroleum products in all types of goods (just walk down the aisle at Wal-mart) is way up, too.

Stop outsourcing our jobs and the Indians won't have so much money. Stop buying anything marked made in China and we can have some input there also. Is there anything left to buy that doesn't say made in CHina? There are ways for the American public (the new poor)to have some say in this nefarious game of big money and greedy politicians.

Nonetheless, there are niches that American entrepreneurs have filled, like specialty furniture, high-quality tech services, organic farmers, etc. Americans could buy American, but they largely have chosen to go for the low-priced (generally crappy) products made in China and sold by Wal-mart. They have voted with their wallets.

While it is hard to argue with people saving money, Americans can't shirk all responsibility for the loss of manufacturing. For example, an unholy alliance of union workers and auto industry managers saw to the loss of quality in American cars and ascendance of Japanese and other imports.

Destroy Florida's beautiful beaches and ANWR, one of the last untouched wilderness areas on Earth -- for a couple year's worth of oil? No thanks. It the Arctic National Wildlife Refuge (ANWR), and there is a lot more there than caribou (birds/fowl/insects summer there; rare plant species; the endangered Dall Sheep; untouched mountain vistas; blue skies). Anwar (Sadat) was the Egyptian president who made peace with Israel.

Let me "reframe:" Why is driving everywhere, commuting 3 hours a day, road rage, stress, less time with family, pollution, global-warming, habitat destruction, etc., all so important? Why has the car become the center of our society? Would it be that awful for people to take a bus, ride a train, walk, bike, work from home, recycle, and buy locally-made products?

Another thing: People want to get mad about oil prices, but it is all their driving that is enriching Exxon-Mobil and the Saudis, and is helping to push up oil prices.

I think a lot of people would be happy to take public transportation. In San Francisco, which I just left, public transportation was good, not too expensive, and well used. The same can be said for certain transportation systems in LA, Chicago, Boston and New York.

But try getting from most suburbs to most urban work-places. Try moving around in Houston on public transportation.

Developing good public transportation has not been on the burner of either of the main two parties... and certainly doesn't seem to generate a lot of votes.

As for the car-owners who drive too much? Those who do have public transportation alternatives need to get on the stick.

I don't deny that some people, e.g., suburbanites, have limited options in some cities. But now's the time to start the change, before driving becomes so expensive that people get stranded, home prices fall, and cars end up being worth very little.

Communities can organize and influence how their tax dollars are spent -- e.g., in mass transit instead of another $50 million project to fix 10 miles of highway.

This is a nice idea but at this point, there's no money to spend. The community of which I am still a part in Northern California just cut 84 jobs from its high school which is already badly underfunded. The state took away money from fire-towers... within a month over 100M was wasted on a fire a person in a closed tower would have spotted when it was less than half an acre... The specific area will probably lose its hospital... The county cannot add new personal and is suffering a hiring freeze...

This is not unique to this area of California which, itself, is struggling to put together a viable budget (the governor, recently, proposed across the board cuts "to be fair").

While I agree that the feds still waste money, and I can give real examples happening last week, it doesn't change the equation--where there is no adequate public transportation--not just for suburbanites but also for people in large cities like Houston and many middle sized cities... people have no choice and there is nothing that is going to create a proper public transportation system anytime soon... even if politicians had such foresight.

OK. So there's no public transport in some places and you're saying there's no money to pay for it. Gas prices will probably keep going up. What's going to happen to these communities? If people can't afford to pay for driving, and can't get to their jobs, we're looking at a potential catastrophe. We may end up needing something like the Civilian Conservation Corps or TVA -- the whole country chipping in.

Absolutely. The Oilgarchy (Bush, Cheney, Rice, et al) encouraged us down this path... there will be no easy solution if we can even solve it at all.

One thing the U.S. could do is to insist that no new cars be sold that get less than amazingly good gas mileage--the kind that many cars in the EU currently get. (Not the big fancy cars that the heroes and villains have in movies, but the tiny cars that are very efficient on gasoline.)

And don't forget about the falling dollar.

There's a real confluence of events that's hurting peoples' wallets.

Remember that there's a lot of Mid East uncertainty priced into oil: Iran's nuclear ambitions, the uncertainty in Iraq, the political upheavals in Pakistan, Hezbollah's takeover of Lebanon...

This stuff scares the hell out of traders, leading to a "buy-it-now-before-something-happens" mentality.

The falling dollar is a reason--and partly too why speculators buy commodities like gold and oil.

But I am currently in an EU country and gas prices are rising here too, so it's not just the dollar.

Why not ban speculators? Why not say that anyone who purchases a future on oil cannot resell that future but has to take delivery?

Here's an interested read: European Gas Prices: And You Thought $3.50 Was A Lot...

Yes, but I wanted to show people what Europeans are paying. They pay much higher gas taxes. So the difference in what we pay and what they pay is more than just the currency conversion.

We put restrictions on futures trading in oil--like the one I suggested above (the futures cannot be re-sold but the buyer has to take delivery).

All markets are regulated--so either you want complete deregulation or we are talking about the different possible regulations.

As for letting oil prices control our lives--I agree we should be focusing, not only individually but in national public policy, on alternatives... which is not yet happening under the Oilgarchy.