The real reason gas prices are soaring

[Random.Capital]

Quote from RiceRocket:

On top of that you didn't mention the motherload in Alaska...

That "motherlode" is good for at best a few months of global supply.

Then what?

 

[Random.Capital]

Quote from olias:

I don't think that's correct

There is an indirect argument for it. The recession killed a lot of demand and prices fell dramatically. QE was an attempt to restore business as usual, which has worked to some degree. Unfortunately that means demand has shot back up as well, so here we are with highly elevated petro prices again, about to repeat the cycle.

Last go round there were food riots - this time there has been actual regime change.

Life is about to get a whole lot more interesting.

 

[jd7419]

Quote from misterno:

If only commercials could trade in, then there would be no hedgers because there will be no need for hedgers.

Allow only spot trading and oil will trade less than $40/barrel overnight. Possibly much lower

Sure because these commercials are so much more honest than the speculators. Why $40, how about 10$? Less participants in the market equals a much higher chance of collusion, this would not be helpful to end users.

 

[thriftybob]

What makes you think gas prices went up, anyway?

When I was a little kid, when Kennedy was president, I remember the sign at the pump said 17.9 cents per gallon. That would be 1.8 silver dimes. 1.8 silver dimes is worth close to 3.50 today, and guess what the pumps say?

The price of gas didn't go up, folks. The price of confetti paper printed by the Fed has just gone down a lot over the years.

 

[number22]

I think big part of oil price is for government taxes, revenue generating for government around the world. There are no other commodities can replace oil to substitute this schemes beside water and grains, which can lead to people revolutions easier than oil price.