“Then there’s the fact of increasing supply: According to recent estimates from the API, “an estimated 4,577 new U.S. oil wells have been completed in the first quarter of 2008, up 12% from 2007, the largest increase since 1986.” In addition, huge new supplies of oil are being discovered off the coast of Brazil, elsewhere in the United States, the Caribbean, and Asia that will greatly contribute to increasing world and U.S. supplies. And finally, world surplus oil production capacity has gone from a very tight 1.5 million barrels per day a couple of years ago to more than 3 million barrels today, said petroleum economist Michael Lynch in March 2008.”
While yes the devaluing of the dollar has had an effect on oil/gas prices this is a bit miss leading. Investor speculation has really been the driving point for years now… first the “terror tax”/supply tax etc… which still hasn’t lifted. We now have “global warming taxes” popping up all across the western world added to that global warming fear mongering and the global warming crusade/anti-oil crusade. While many of these thing have had very little direct market effect they have heavily effected one area… speculation… every time a bomb goes off, a global warming nuts speaks you can map that to rising prices. The reason prices have “slowed” recently is the investor speculators have pretty much fear mongered the market as far as they can at the speed they were able to and thus in turn max out the “fear mongering” “taxes”. I would expect as things settle in iraq/mideast(at least from the speculators point of view because iraq and the middle east could explode but as long as the speculators thinks its all good the price will go down at least in the short term), global warming myth is busted, and mass drilling for oil(or at least saying their will be mass drilling) will in the short term reduce prices(or more reduce the fear taxes).
