Strengthening Constitutional Self-Government

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Gas Prices Still Rising

Despite President Obama's decision to tap into our strategic petroleum reserves, which I took issue with here and in the Los Angeles Times a few weeks ago, the price of gas has continued to rise. On June 23rd, when the president made this decision, the average price of gas was $3.61 a gallon for regular unleaded. Today the nationwide average is $3.70 a gallon. Meanwhile, one-third of our offshore drilling fleet has left the Gulf of Mexico since President Obama issued a moratorium on drilling and there are over 70% fewer drilling permits being given today than in previous years. The administration's misguided energy policies have depleted our emergency reserves and caused the price of fuel to increase, and they need to change.
Categories > Economy

Discussions - 2 Comments

Still an unusual and hard to understand decision on the petroleum reserves. I think the decision was perhaps wanted by the CTFC to gather data and see how speculators would respond.

On a note related to the deficit, some folks talked about selling off these reserves, maybe even opening up fort Knox, dumping gold. No doubt that it is a deflationary move, and not really a great idea.

Like taxes it is deflationary because the gov. soaks up dollars, but it is even more deflationary because product is put on the market. The amount of reserves they dumped were more or less inconsequential, but the analytic effect was down. So you have causality running in the opposite direction.

Also that did do something strange to my gasoline model anyways, it has been off and at least in Ohio I have been predicting higher prices than the average at the pump. So prices at the pump in Ohio and to an extent I think nationwide (I haven't yet built out all the states) have actually been bellow NYMEX RBOB+taxes+transport+franchisee guaranteed profit(modeling BP agreement).

The whole debt ceilling debacle and the austerity that we are taking on in terms of budget cuts is also deflationary.

Folks always say the "economy is good" or the "economy is bad"...but in truth a bad economy is good for lower gas prices. Anything that has an inelastic demand curve like gasoline does really drops in price when demand falls.

I more or less believe congress and the president made an unforced error on this whole debt ceilling deal, but perhaps 9% unemployment was good enough and they wanted to get a jump on the inflation problem.

In any case as it relates to gasoline a 9 cent jump in gasoline from 3.61 to 3.70 is so so. In fact I am willing to call the national average down to 3.61 this weekend.

So national average gasoline price hits 3.61 on Aug 6-7...

The answer isn't complicated - let the economy heal. How to do that? Lower taxes, drop regulations, maybe fiddle with certain tariffs, and let 'er rip. Reform those stupid commodities markets for oil. And for God's sake stop worrying about "income inequality" and/or "social justice." There are no such things as "equality" or "social justice." at least nothing objective that could be agreed upon.

Or, if you want pithy, "Nobama in 2012"

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