This means that ‘demand’ is up… demand from investors, that is, and thus price goes up for us at the pump as a side effect. I am willing to bet that some of our ME ‘friends’ are part of the problem, but if you take a look at the data, you’ll find that a lot of the Oil buys that are whacking our gas prices come from Red-Blooded, Green-Pocketed American Investors. They’re trying to keep their capital safe and investments in companies right now doesn’t look great.

The best that the Feds could do, I think, is find a way to make the dollar an attractive investment again. Given the current state of things, I’m not sure how they could go about doing that. The sub-prime mess is still affecting investor thinking (and worse yet uneducated consumer thinking), and a lot of international investors that I’ve talked to are finding other places to sock their money. More than a few of them have decided that ‘something is not quite right’ (as a British friend put it) in our current US economic situation. Bernake and the gang need to figure out what that ‘something’ is (real or imagined) and fix it.

Then, maybe, the price of oil will drop again.

One of the things that has been blowing my mind is the complete disconnect that both the Dems and Reps show on this topic. Gas is not high because of shortages… therefore, drilling in ANWAR will not drop the price of Oil, it will just make more oil for investors to hide their capital in. ‘Green’ energy will not drop the price of Oil, because A) It doesn’t exist yet and even the most promising tech is a good 3-5 years away from mainstream and B) demand for ENERGY is not what is pushing the oil market, demand for safe investments are.

But, what the hell, most Americans don’t bother with the details, so why should our politicians? Vague policy statements, rhetorical political memes and good old fashioned Stump Lies will do fine to get someone elected.

Bleh.

I understand your point and you might well be right. But one thing I have noticed is that there are not any shortages. I am not sure this price hike is really being driven by any shortage of supply. If that is true increased production from the Gulf states might not have much impact.

In fact the other day it was reported that Brazil was going to start exploiting a huge reserve of oil off her coast and the markets did not even react.

Hi, TerryeL. I’m not sure he can do anything. That’s why I said “maybe.” On the other hand, the Gulf States are defense clients of ours. Remember Kuwait? They’re rich but weak, and it’s the U.S. that protects them against local predators like Saddam. That’s a pressure point for a President willing to play hardball, which is what the Arabs are playing with us by using their sovereign wealth funds to manipulate oil prices.

Additionally, a stronger dollar brings oil down. To that extent, our current monetary policy is killing us at the pump, and there may well be room for a new administration to do better.

I noticed just now that there are some thoughts on this subject up at the Hillary website. Her bullet points sound good, at least at a quick read. But the idea that so-called ‘energy independence’ has anything to do with this is absolute rubbish; as well, the Dems would do well to walk away from the Global Warming junk science burlesque while they still have a little dignity left. I’m lookin’ at you too, Barack.

What exactly can the president do about world oil prices? I mean really?

In fact if I remember correctly the Democrats ran for Congress promising to bring down gas prices and not only have they failed, prices have gone up more since they took over than they did before.

If you are not convinced just check what the ‘reverend’ believes about right / left, black / white brains.

Perhaps we should have a voter guide reflecting what side of the brain Obama will be reaching out from so as to avoid confusing Palm Beach voters yet again

The roaring oil boom of the last few months may be on its last legs as economic growth slows hard across the world and a clutch new refineries come into operation, Lehman Brothers has warned in a hard-hitting report.

“Supply is outpacing demand growth,” said Michael Waldron, the US bank’s oil strategist.

“Inventories have been building since the beginning of the year. We have pretty significant projects starting soon in Saudi Arabia, and large off-shore fields in Nigeria,” he said.

The Saudi Khursaniya field has just opened with 500,000 barrels a day (b/d) of production, and the new Khurais field will start next year with a further 1.2m b/d.

The Saudis have pledged to spend $90bn (£45bn) on their oil industry over the next five years, lifting capacity to 12.5m b/d by the end of 2009.