Posted on 03/16/2008 10:35:28 PM PDT by big bad easter bunny
The last time strategic oil reserves were released was in 2000 by Clinton and oil was at around $27 per barrel. With the overall psychological effect of high gas prices, what could be better than finally crashing oil prices? The price of oil is not justified by any economic variable, even the president of Chevron has said there is no oil shortage, there are no lines at any gas station, usage overall is down!
This market is being manipulated, by hedge funds and tyrants. Can anyone give me a reason not to use this tool?
Yes; same reason why so many are not thrilled by the reduction in the discount rate for interest - you’re showing a panic. If he announced he’d release some from the reserves on July 1st, it’d maybe have some calming effect, but you have billions upon billions fleeing currencies, pouring into oil, gold and commodities. Everyone has an investment account right now - we’ve got so much money in the market, that is looking for an investment, that anywhere it goes inflates the price. It’s the dot-com situation all over again.
‘Can anyone give me a reason not to use this tool?’
Because the reserve would be used up in a couple of days.
From http://www.freerepublic.com/focus/fr/1251017/posts , a 2004 post about George Soros manipulating the oil market. I’m wondering if it were true then and if it’s true now.
The price of oil hasn’t changed much. The value of the dollar, however, isn’t what it used to be. Since we buy oil in dollars, we pay more of those dollars to get the same amount of oil. Releasing oil from the strategic reserve won’t change the value of the dollar.
Yes. WHEN, not if, Israel or the US or both, bomb Iran's nukes, we will need every single drop of our reserves to keep oil from going to $200.
That story folds like a cheap suit when you compare the percentage increase of the price of oil to the percentage decrease in the value of the dollar.
Woopee. The reserve will last a couple of days. It’s only symbolic at best.
Thank you! Somebody else gets it. There is an inverse relationship between the price of oil and the dollar. Releasing oil from the strategic reserves wouldn't do diddly squat to lower the price of gasoline at the pump. We need additional refining capacity and a strong dollar to lower gasoline prices. Releasing oil from the strategic reserves isn't going to add anything to our refining capacity, nor will it help the sagging dollar. All it would do is empty the reserves that we might need if Iran needs a thumpin'......
This statement is blantantly false! Your chart is worthless without the price components. Crude oil has TRIPLED in price from the start of 2003 (~ about $32). The dollar has not lost two thirds of it's value since then.
Because having politicians having another tool to manipulate the oil market would be even worse than today.
But most importantly, it is a strategic asset. Would you sell of Air Craft Carriers and Nuclear Subs to lower national debt?
Rename it the “Tactical Oil Reserve” because that’s what it is. Then rename ANWR the “Strategic Oil Reserve” and implement the necessary steps to make it available.
It would be more effective to stop allowing margin trading on oil futures.
Outlawing the trading in the States will not stop trading, just move it completely out of the US. Oil is a global commodity and most of it is produced and consumed elsewhere.
I would amend your post at only one point. We need domestic sources of oil more than a “strong dollar”. Drilling at ANWAR is a start, but we also need more drilling in existing fields, such as off of the California and Florida coasts.
It's beyond time to USE our expertise and knowledge.
Your nuts.
” We need domestic sources of oil more than a “strong dollar”. Drilling at ANWAR is a start, but we also need more drilling in existing fields, such as off of the California and Florida coasts.’
Exactly.
AMEN! (From the balcony, of course)
I wonder when the folks in Florida and Kalifornia are going to realize that their state's policy towards energy production are part of the problem? New Mexico and Colorado sure don't have any problem drilling for oil. The wife and I were just out there a couple of weeks ago and it was apparent that the oil biz is booming in those areas.....
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