FOX News in 2008: President has no control over the price of oil

March 9, 2012 | By | 12 Replies More

Back in 2008, before Barack Obama was President, FOX News understood that no president has the power to affect the price of gasoline:

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Category: Economy, Energy

About the Author ()

Erich Vieth is an attorney focusing on consumer law litigation and appellate practice. He is also a working musician and a writer, having founded Dangerous Intersection in 2006. Erich lives in the Shaw Neighborhood of St. Louis, Missouri, where he lives half-time with his two extraordinary daughters.

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  1. Adam Herman says:

    The hypocrisy runs both ways. And then they try to go after “gougers” while not finding any because all that’s really going on is everyone pointing fingers at everyone else. Meanwhile, American drivers are whiners, paying the lowest prices in the West.

  2. Adam Herman says:

    The higher prices are having an impact though. I’m seeing fewer SUVs on the road than I saw 5-7 years ago. Around 2005, it appeared that every third car on the road was an SUV. Now it’s more like one out of eight.

  3. Adam Herman says:

    There will always be a market for them because the family station wagon no longer exists. That’s actually a regulatory failure, the station wagon went away because fuel efficiency standards for cars are lower than for trucks and sport utility vehicles. Putting station wagons in the truck category would probably reduce overall fuel usage. Although that ship might have sailed, given how unfashionable station wagons are now.

  4. Niklaus Pfirsig says:

    There is one thing that the lawmakers can do. Take action to reduce speculative trading in the commodities markets. The commodities market is where orders for raw materials and agricultural products are auctioned. These orders are known as futures contracts or simply futures.
    In 2000, the federal government deregulated commodities trading. this lead to an increase in commodities speculation.

    The basic idea of speculation is “buy low.sell high”, and the best way to sell high is to control the supply, metering out a little to create an artificial shortage. The shortage increases the demand, drives o[ the prices of the materials by effectively holding the materials hostage.

    The artificial shortages create huge profits for the speculators. Of couse the libertarian mindset says. “See, those nasty regulations kept people fom making money”, but they refuse to see the big picture. The speculators are not making money. They are taking money from someone else. They are creating toll bridges between the buyers and sellers.
    There are also upstream and downstream effects. In the case of oil, the oil producers make less profit, and the refineries can’t run at capacity due to the shortage created on the trading floor. Other industries that rely on oil are equally harmed, and are forced to up prices for petrochemicals use din the production of everything from plastics to medicines to even the ethylene gas used to ripen vegetables.

    Anyone who truly follows Ayn Rand’s philosophy should see that speculators are parasites of the worst kind. Likewise progressives and pro business conservatives should see the chilling effect speculation has on the economy.

  5. Adam Herman says:

    The speculation is only a minor problem. First, speculators can’t create shortages. That’s what OPEC is for, as well as foreign crises, since the oil regions tend to love having crises all the time. Second, speculators increase the short-term volatility of oil prices, but the long term trend is up and up because demand is increasing while supply is increasing only slowly and some say we may be near peak oil.

    There’s just no way around ever more expensive gas and I think that by trying to bring the price down we are acting at cross purposes. if the goal is to get us off oil, then oil prices must rise. If we bring them down, then consumers will stick with what they know.

  6. Niklaus Pfirsig says:

    Adam,

    Wrong.
    Read this and this.

    Or how about a different source or even Forbes .

    You say it’s OPEC?
    In 2011, we were getting about 37 percent of our crude oil from OPEC member nations, with Saudi Arabia as the largest OPEC supplier. The other 63 percent came from non-OPEC nations, mostly from Canada and Mexico.

    Do your homework Adam. I mean it. You’re connected to the Internet and can find the facts and figures in a few minutes. Remember, we can, as well.

  7. Adam Herman says:

    I don’t dispute your facts, only your interpretation of the facts. How much oil WE get from OPEC is irrelevant. It wouldn’t matter if we got none of our oil from OPEC. It’s a world market and OPEC is a cartel that has great power over prices, so long as they aren’t cheating on their quotas.

  8. Tim Hogan says:

    According to an Obama administration press release today, reported on NPR, the US imports only 43% of its oil, US oil production is at an eight year high and the producton of natural gas is off the charts.

    The folks at Faux News would like you to believe its Obama’s fault but, I say it’s the Republicans.

    The Dodd-Frank bill allows for the CFTC to regulate West Texas Intermediate Crude but, the regulations have been stymied by industry and Republican oppostion and threats of lawsuits. As a result, the UK and Dubai are still allowed to regulate some 25-35% of that market and subject the same to specualtion which some experts say accounts for 40% of the price per bbl. of oil.

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