11.24.2008

I have a hunch

I filled our Suburban up for about $38 yesterday. Even as I did the happy dance, I know it can't last.

I have little more than intuition to peg this on, but mark my words - these gas prices are not here to stay. They may last a week or a month, and they may even go a little bit lower, but they're getting ready to skyrocket back where they were this summer or higher.

Helping form my conviction on this:

1) People have already assured Big Oil that we will pay $4+/gallon. Yes, we might drive a little less, but not half as much as we do at $2. They can sell less and make more at $4/gallon.

2) Very few people want to hear politicians talk about alternative energy. This dip in gas prices reassures people that we don't really need to worry about using anything other than oil, further diminishing their interest. The only thing we are burning faster than oil is time....time that should be spent on research but won't be, because gas is cheap again.

3) Markets are driven by speculation, not production. Look at the recent stock market activity. It swings wildly day to day - is that because the stocks intrinsic value fluctuates that fast? No it's because the number of people who bet that someone else is dumber than they are is skyrocketing. Oil will fluctuate just as quickly.

Fill your tanks, friends. And your barrels and your pitchers and your swimming pools. $4 gas will be back sooner than you think.

5 comments:

Joyful said...

Hey there!

I can't argue with your facts about the whole "lower the oil prices and the giant (body of seriously broke Americans) will be lulled back to sleep" proposition. You are right.

However, something happened to me last summer. I was leaning on a gas pump while I filled up the 'ol car and all of a sudden it happened. A wind of inspiration swept my heart away and I prophesied to pump #12 at my local COSTCO, "Gas prices are coming down!" Yep, I just publicly prophesied to a gas pump right there in front of God and everybody.

It wasn't until later that the email from a gal in Florida came around like a sword singing the same fighting words as it sliced through all the gloom.

Perhaps we need to prophesy to a few more parts of the 'oil industry' besides the gas pumps.

Esther Irwin said...

I scored big time today - I had a 10c/litre off coupon and petrol went down to $1.43/litre today!! So I only paid NZ$1.33/litre!!! YUS!

Of course I only got the 10c/litre off coupon b/c I bought more than $100 groceries - 2 turkeys at NZ$64.00 each. Sad that turkeys are so much over here. But they were really good and fed 50 people.

Grea0016 said...

I just received your thank you card in the mail from a donation I made a while back.

Thank you for the card. It meant a lot. I am glad the twins are doing great!

Happy Thanksgiving my friend!

-Ashley Greene
Jacksonville Beach, FL
Grea0016@unf.edu

Loose Arrow said...

You must see "Who Killed the Electric Car?" Just google it and have ye eyes opened! Or check out the trailer I have on my blog.

As for the gas prices, I am rejoicing at $1.46/gallon over on Holmes Rd.

My thoughts are rather than gas prices rising, what if, in the near future, the US dollar continues to fall and we can't even afford 99 cent gas?? Just a thought to get your gears spinning.

Scott said...

Actually, oil prices are driven by supply and demand. The rate of oil production compared to the rate of oil consumption.

Before our current "crisis" the oil producers were pumping at full speed and the world was burning it all.

Now the producers are cutting back production because people are driving less.

Someday soon the price will go back up: it will be when the demand matches or outstrips production. That time will probably be next summer (summer is peak use), or the first summer after we are out of this economic crisis.