How low will oil prices fall when Obama is elected?
When Clinton left office, oil was $27/barrel...now it's 3 times that much. It peaked at well over $100/barrel under Bush. How far will it come back down now that the oil baron is leaving the White House?
- nuke_ben_ladenLv 41 decade agoFavourite answer
Oil prices are a function of the "value" of the US dollar. Think about it. What has really changed over the last 2-3 months?
Did you drive less? NO.
Did you use less enegy in your home or business? NO.
What has happened, was what happened before, that made oil expensive in the first place. The government allowed the dollar to fall off a cliff about 6-8 months age and boom, we had expensive gasoline. See the politicos saw the "credit crisis" thingy coming down the pike and they were trying to stop it by using cheaper dollars. That idea didn't deal with it and instead had unintended consequences ie... inflation.
The "credit crisis" really hit home, and wonder of wonders, the WORLD now wants US dollars in an unstable world economic environment. Demand is up and the dollar is now going north in a hurry and lo and behold gasoline (oil) is now falling because the pieces of paper with the little Presidents on them are intrinsically "percieved" by the WORLD as being worth more.
Adam Smith rules.
This is all really supply and demand 101 or supply and percieved demand.
- 1 decade ago
Hahahahahahahahahahahahhahahahahahaha LOL. Democrat, I love you. I really do.
Oil prices went up because:
1) Emerging economies in the world demanding a lot more energy (China and India among others). When demand is up, you have a lot more people that want your product so you can charge more for it and people will pay it.
2) The dollar has been going down in value compared to the Euro and some other currencies. I think this has a lot to do with our growing deficit causing people to lose some confidence in the dollar. For this Bush does deserve a good portion of the blame. I don't think the guy vetoed hardly any spending bills. Although a Republican, Bush is not much of a conservative fiscally speaking.
3) Natural disasters and international crises.
Theoretically the next president could reduce spending and/or increase taxes to reduce our deficits. This would probably boost the value of the dollar meaning we could get more oil for a dollar. On the flip side our exports would be more expensive for other countries to buy so we'd probably see our exports go down.
Obama does want to increase taxes, but he also wants to increase spending. By the way, i don't think bringing the troops home will save us $10 billion a month. I believe some of that money we would be spending anyway to maintain our military even in peace time. But I could be wrong about that.
Obama may see a better international climate and fewer natural disasters...but it might be worse. We'll see...if he wins, that is.
If you're really expecting gas under 2 or 2.50 a gallon in California, I wouldn't hold me breath. Remember, Obama actually likes high gas prices. High gas prices discourage use and help save the planet, in his mind (somebody better tell the Chinese though 'cause they'r polluting like there's no tomorrow...or maybe the earth knows it's not supposed to warm up from their greenhouse gases, only from ours).
- 1 decade ago
allimac: we have a lot of oil in the US We are just not allowed to drill for it. Sarah palin may have something to say about that. People in alaska are by in large pro drilling in anwar. Wouldn't the people who live there have a little more knowledge about the area than other people. Also all these clips of anwar you see with the wildlife that will be effected-- They're not really anwar!!! They're filmed in Juno; a place where no body wants to drill. Anwar is fairly deserted, as is much of the state. Compared to the state of alaska, anwar would be the size of a postage stamp on a football field. There is alot of oil there. Remember when people were worried about displacing carribu when they built the pipeline? The carribu love it now. They crowd around it because it is warm.
Bush had little to do with the price of oil skyrocketting. That was OPEC. The answer to driving down the cost is more domestic production and do something to ban speculation. Did you know it is not uncommon for a barrel of oil to change hands 60x before anyone actually takes delivery on it.
Obama wont be able to lower oil prices. Our economy is centered around oil. It will take decades to develop new efficient technologies AND transition everybody over. We need domestic drilling now!
- jdbaum42Lv 41 decade ago
It will almost certainly go back up. With no prospects for drilling or exploration on US soil under BO, the Saudis will drop production, the market will react and it'll jump right back up.
Look, Bush merely mentioned drilling and it's dropped 25% in a couple months. Coincidence? I think not. Plus, the oil companies will have to raise prices to compensate for the higher taxes under Obama. There's a fair chance the gas tax will go up as well, to pay for pay for ethanol subsidies or windmills. Welcome to the Obama-nation.
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- vilardiLv 44 years ago
Obama is offering the comparable tax nationally that Palin is using in Alaska, a providence revenue tax. i'm additionally against drilling, the oil wont pass to the U. S., it is going on the international industry. It wont "cut back" our dependence on distant places oil and it wont decrease the fee of costs lots if any. We in simple terms can not produce and drill adequate to compensate. gas costs larger with deregulation on the potential markets, oil risk-free there. humorous how costs sky-rocketed as quickly as we deregulated the industry huh? regulation isn't a undesirable ingredient, fairly while it includes potential. You decrease the fee of potential by ability of making an investment in competing products, no longer by ability of making it 10-15% extra low fee for them (take 15% of four.00, how lots is that quite saving you? $6 a tank). You rigidity the industry to diminish its call for. Oil isn't the answer.
- Anonymous1 decade ago
It only peaked after the democrats got control of Congress.
Under Obama, it will likely hit 3-400 a barrel as socialist countries try to keep their pathetic form of government afloat.
- 1 decade ago
obama being in office isn't going to make the price of oil fall...geez,
you think if he's elected money trees are going to spring up in your back yard, as well?
- 1 decade ago
When McCain is elected the price of oil will stabilize.
- khanLv 41 decade ago
Even being a Bush-hater, I cannot bring myself to blame him for oil prices.
This is the result of OPEC and those greedy people who, unfortunately, have a choke hold on the American economy.
Some buck cannot be passed to the President.
- Anonymous1 decade ago
Today a gas station in my area (connecticut ) was selling gas for $2.02 per gallon . I doubt it will stay down for long .. but I'll take it while I can.