Steve Forbes is predicting oil prices being down to $35 to $40 a barrel in the next year. He says, “This is sheer bubble speculation.” And “speculators know now that no matter what happens to the price of oil Uncle Sam is there buying almost every day. Stop the buying and in fact throw some of that oil on the open market, boy that would throw it in turmoil and send the price down.”
Jos and I were talking about this last night and agree. Prices are going to continue to climb until more and more people are unwilling to buy contracts on increasing future prices.
Not a speculator but you want to do your part to fix the problem? You have two options change demand or change supply.
Change your demand and vote for lower gas prices. When you make a purchase you are voting. You are voting that you like the prices. This is a poll where you can vote as often as you like. The more often you say you like the increasing prices the quicker the gas companies will know you like it. So, stop voting if you want gas prices to go down. You really do not need to change you driving patterns that much for everyone to have an aggregate affect on the market. Maybe you vote to only drive to work. Maybe you vote to car pool. Maybe you vote to go to work and to the movies and shopping and visit every drive through in the area. No matter what you do, you are choosing to pay for as much gas as you are willing to pay for.
You might ask, “How can I change supply?” Many people are blaming the short supply on a lack of oil refineries and restrictions on exploration. First, you can invest in refining and exploration companies. Investing is voting that you want to company to do what it is doing very well and give you some of the profits. Also, you can call up the oil refining companies and ask them to buy your land to build an oil refinery. Both of these options will probably be hampered buy existing law that depresses (sometimes killing) the incentive for these companies to do what they do here in America. So, call all your elected officials and tell them that you want to do your part to help the economy, but cannot because they have passed laws that prevent it.