As oil plunges not only do gas prices go down, but so will prices for the 1,000+ items made from petroleum. The other major benefit of this is pits like Iran, Russia and Venezuela, which rely on high oil prices, won;t do well at all with this lower price. The only thing that made Russia’s invasion of Georgia possible, as an example, was the profit from the oil boom.
All gone now. Let’s keep it that way.
Gasoline continues plunge; crude tumbles below $60
Retail gasoline prices dipped for a 17th week since July 4, falling below $2 a gallon in a number of states and approaching $1.50 at some service stations…Oil prices hit a 20-month low Tuesday as Wall Street offered yet more evidence that consumers have gone into hiding.
Retail gasoline prices fell overnight to a national average of $2.22 a gallon, dragged down by the falling price of crude, which now costs 60 percent less per barrel than it did in mid-July. The average price for regular unleaded gasoline has fallen nearly 32 percent in the last month.
The insane price of oil, and the ridiculous fast pace of its rise, should have been the biggest warning sign in the world that the economy was false and ready to tumble. Now we know.
Maynard comments:
People, always keep in mind the ebb and flow of history. In our panic, we tend to extrapolate every trend as if it never ends. That sort of thinking leads to mistakes. In dealing with the immediate crisis, try not to entirely lose sight of the big picture.
The crash in oil prices is a great relief; however the issues of our energy supply for the long term remain highly relevant.
Six months ago, when oil was at $140 a barrel, and I told people it would be at $50 or below by the end of the year, they looked at me like I had three heads.
Back then we heard about greedy oil companies and their “obscene profits.” How long now before we start hearing that with prices so low, Big Oil is the next industry in need of a “bailout”? Both thoughts are equally stupid.
Not so fast. Oil inventories are falling. Oil stocks and energy stocks in general are in the dumps. I’m buying. Buy! Buy! Buy! Unlike paper dollars, the Fed can’t print up barrels of oil.
Commodities follow a predictable pattern. As supply/ demand inches toward a 5% cushion, the prices are remarkably stable. As that cushion narrows, imbalances cause prices to gyrate and spike. We now have a good sized cushion in the supply/demand equation. Prices are down, and speculators got spanked. As the demand for oil creeps up, we will get another spike, when we cross the magic 5% mark. Oil will jump, and if the economy is pulling out of the recession, oil will do great. Look for oil service stocks that have been beat up. Good luck all.
While I’m enjoying the falling prices, I’m also doing all I can to conserve. We all should.
I know the left doesn’t excell at common sense, but we need to make fossil fuels obsolete. It’s bad for the environment and it makes us dependent on nations that hate us and love to prosper on our addiction. We can’t do away with oil right away but we can reduce our dependency on foreign oil now. I think by now, we all know the solution.
As a retired Coast Guardsman, I can tell you that when (if) we start to drill more, accidents will happen. The rewards, however, will be greater.
When an oil spill occurs, the left is going to start their usual b*tching, blaming it all on Sarah Palin and her “big oil connection” and so on. None the less, hard decisions need to be made.
Environmentalist have a stroke when “dispersants” are mentioned. Dispersants are like paint thinner. If oil remains in the water long enough, it will begin to thicken. It’s something we call “chocolate mousse”. It’s impossible to recover and will sink under oil containment booms due to the action tidal currents. Blobs of the thick oil will pop up outside the booms (which are sort of like curtains around a spill site) and head for shore.
Yes, I know you are spraying a chemical into the water, (environmentalists wet themselves at this point) but the oil has to be thin enough to recover. If stand around and wring your hands, you spend more money removing the contaminated sand on the beach and replacing it with new sand. Oh yes, this actually happens!
There’s more common sense prevention that leftists have a spasm over, but I’m assuming that we will drill more with the Dems in charge. Chances are things will just go on as they are now or perhaps, Oblahma and the gang will make drilling so restrictive, the oil companies would go bankrupt if they made the attempt.
I wish the gas prices here in Miami would come down to the same as other areas in S FL. Miami-Dade county has all these extra taxes on fuel that are just crazy. The lowest I have seen it here is $2.40.
Bitch and moan all you like, Larry: how quickly you forget it was well over a $4 three months ago. Prices I’ve seen here in Broward aren’t different from yours in Dade. Florida doesn’t have a state income tax, so sales taxes tend to be high.
Good caveat, Maynard. “..however the issues of our energy supply for the long term remain highly relevant…” is the one thing we must keep foremost in our minds.
I fear, greatly fear, that the element I call “Americana”, the same people who do “PC” for the moment only, will be running out getting super-charged SUV’s, exhalting in being saved from the abyss of pedestrians.
(On SUV’s: How much energy is consumed air-conditioning or heating all that cubic space as oppose to a coupe or a sedan?)
Oil prices will skyrocket as soon as Obama & the Lib’s agenda becomes clear. He has already said he would reinstate the off-shore drilling moratorium and seek to bankrupt the coal companies. These things all have effects that ripple through the economy that the dumbed-down schools have succeeded in keeping the public ignorant of. Get ready to lose everyone of the very temporary gains we made before the libs gave away the country. Now they (and we) will get exactly what they asked for. YIKES!