Drilling wont help.
The falling dollar is the cause.
A weak dollar helps our manufacturing however.
It is called Supply and Demand. Drilling most certainly will help. Even a big reserve find like the one they found under the Gulf of Mexico off Texas last year will help a lot.
####Drilling wont help.
The falling dollar is the cause.
A weak dollar helps our manufacturing however.####
Surprising more people (the media) do not make that cause and effect connection.
How many EURO’s or Pound Sterling does it take to buy a barrel of oil? It puts it in perspective real fast.
I am not sure the boost in manufacturing is more than a blip on the screen at this point. The price I am paying at the pump, food market, and home heating oil seems like a lot to pay for that blip. Not worth it IMHO
Your context is a little off. Drilling by itself won't necessarily or drastically affect oil prices. The price of a barrel and the price at the pump are not directly and/or completely related.
But adding supply to offset demand will certainly drive prices down. Supply has to be supplemented with refinement capabilities and right now, America doesn't have the infrastructure to refine much more than we already do. We don't build refineries anymore.
Now, if there was a market to refine more oil, there would be a bigger push to build refineries. To do that, the cost of the assets would have to be offset by the potential profits. And what is the most expensive and restrictive part of "drilling for oil" or "refining" it? Land, legal and EPA standards, processes, procedures, red tape, etc.
We could bring a lot more oil into this country and drive prices way down in 5 years if we were as committed to it as we were to get a man on the moon.
Sure it would.
1. Supply increase —price drop.
2. A large portion of the current price is “fear” driven -— countries/companies buying and hoarding, so to speak. No one fears the Eskimoes will turn into nuclear-armed thugs, cutting off the supply.
3. Increased domestic production — less imports, better balance of trade -— more expensive (I hate the word “stronger” in this context) dollars.
Even more reason to open up domestic drilling. We have a $750 billion trade deficit and 1/3 of that is for foreign oil imports. Reduce the flow of dollars out of the country and the dollar will gain some strength.
At this point though...is the dollar the cause of oil prices, or are oil prices partly responsible for the dollar’s decline?