Conspiracy Heaven
I was sitting on the couch watching Fox business and CNBC this morning and the overwhelming winner in the news was the gas prices. As always they had their assortment of bobblehead drones, each of which were just as PO’d as the next that they weren’t getting their opinion heard. There were some great arguments from both sides of the coin, but there were two that intrigued me the most.
First off, “Our gas is cheap!” I really can’t agree to that when you look at the gas prices around the world. Ten years ago the gas prices in Europe were crazy high, so if you look at the pricing today in other countries…we have cheap gas. The other was, “The oil companies are colluding to raise the price of oil and thus the gas prices.” I can see that happening, especially with the way the futures market is traded. It is entirely feasible that the oil prices would be open to that type of manipulation. I thought about this as joe blow market analyst 1 battled with joe shmoe analyst 2, and I had conflicting ideas that evetually left me in the conspiracy theorist realm.
Ok, on the first idea, gas prices are cheap and we have to agree when you look at it from the global pricing angle. However, there is a big difference in the way the countries are set up. Over in Europe, the cities are rather compact and most everything is accessible by their Tram systems. The cars over there are for the most part smaller and so the costs per person is lower. Generally, people walk more over there and therfore have less dependency on gas. Over here, we have suburbia and different cities with different suburbs. Everything is more spread out, partly because we have more space, but nonetheless we are more spread out. Here in Georgia, the city of Atlanta encompasses several cities. In fact, if I were to go on an interview at a company in “downtown” Atlanta, I might end up in Sandy Springs which is 15+ miles outside of Atlanta. So, in that respect gas isn’t that cheap. We haven’t developed as a nation on the concept of keeping things close, for the most part.
Also, families are a lot more spread out than in some of these countries. Families are closer in Europe, or at least in my experiences, and that alone lowers the need for these 8 hour trips on holidays. Once again, because we travel longer distances for work and play, you can’t really say that the gas is cheap. Saying that without weighing the many other factors is just dumb.
On the second idea, collusion is a possiblity. Now I am not a wall street wiz kid at all, in fact I am really getting my feet wet in the whole system. From what I have been learning about futures trading, you are basically making bets on the future price of things to secure those prices and the pricing of today. That idea alone invites the concept of dirving prices up on purpose and with ease. If someone who knows more about it can interject some light I would be appreciative. One of the “Green” debaters kept harping on the other methods of fuel while the obvious pro oil folks shot down his ideas as hurtful to the economy.
I have to agree about some of the bio fuels that they are trying to get put through. Let’s be honest here, they are going to have to grow a ridiculous amount of those plants to generate the fuel quantities this country needs. Does that mean we are going to stop developing land for residential use and instead use it for the growth of the plants? Personally, I would say that companies will just start bringing down forrests and such to plant their crops, which will just add to the problem.
Anyway, I am starting to ramble. Here is where the conspiracy started, and I pose the question to anyone who cares. Do you think that the oil companies, and the power that be who are invested in oil, have started to raise the oil futures and thus our gas prices in order to bring offshore and protected area drilling to the US? It would be a pretty slick plan if it were true, and it is totally feasible. What do you guys think?
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