Gas could fall to $2 if Congress acts, analysts say

[red states rule]

Maybe this is why Dems oppose new drilling - they want the price of gas to keep going higher just in time for the election



Gas could fall to $2 if Congress acts, analysts say
Limiting speculation would push prices to fundamental level, lawmakers told

WASHINGTON (MarketWatch) -- The price of retail gasoline could fall by half, to around $2 a gallon, within 30 days of passage of a law to limit speculation in energy-futures markets, four energy analysts told Congress on Monday.

Testifying to the House Energy and Commerce Committee, Michael Masters of Masters Capital Management said that the price of oil would quickly drop closer to its marginal cost of around $65 to $75 a barrel, about half the current $135.
Fadel Gheit of Oppenheimer & Co., Edward Krapels of Energy Security Analysis and Roger Diwan of PFC Energy Consultants agreed with Masters' assessment at a hearing on proposed legislation to limit speculation in futures markets.
Krapels said that it wouldn't even take 30 days to drive prices lower, as fund managers quickly liquidated their positions in futures markets.


http://www.thenewsvault.com/cgi/xtra.pl?go=12143058978

[5stringJeff]

Wrong, wrong, and more wrong. "Speculation," or futures trading, is the most efficient pricing mechanism there is. Every buyer and every seller is a voluntary participant, and every transaction is a reflection of current market conditions.

The only thing a limitation of futures trading would accomplish is the replacement of New York as the world's financial capital. Futures traders would move somewhere else, like London, Dubai, or Singapore.

[red states rule]

Wrong, wrong, and more wrong. "Speculation," or futures trading, is the most efficient pricing mechanism there is. Every buyer and every seller is a voluntary participant, and every transaction is a reflection of current market conditions.

The only thing a limitation of futures trading would accomplish is the replacement of New York as the world's financial capital. Futures traders would move somewhere else, like London, Dubai, or Singapore.

If the US sends the message we are serious about tapping all the oil we have within our own country - the futures will drop

[glockmail]

I agree with Jeffie on this one. Leave the markets alone. Congress should act to allow drilling on coasts and in ANWR, as well as promote nuclear power and natural gas. The "evil speculators" would respond immeadiately to drive the cost of oil back down.

[5stringJeff]

I agree with Jeffie on this one. Leave the markets alone. Congress should act to allow drilling on coasts and in ANWR, as well as promote nuclear power and natural gas. The "evil speculators" would respond immeadiately to drive the cost of oil back down.

Indeed.

[glockmail]

Indeed.
This doesn't mean that we'll be taking long hot showers together.

[red states rule]

Instead of doing the obvious, Dems are out to punish the oil companies.

Here is what Dems wasted their time on today


House fails to move gas pump price gouging bill

By H. JOSEF HEBERT, Associated Press Writer
19 minutes ago

WASHINGTON - House Democrats failed Tuesday to resurrect a bill to punish price gouging at the gas pump, while maneuvering to block Republican attempts to expand offshore drilling, an idea gaining in popularity amid $4-a-gallon gas prices.

Action on legislation that would assure continuation of the ban on oil and natural gas drilling in most of the country's coastal waters was put off until later this summer after it became increasingly clear that Republican lawmakers may have the votes to lift the drilling moratorium.

As Democrats prepared a string of energy proposals before lawmakers depart for the July 4 holiday recess, Republicans charged that they were being blocked from getting a vote on whether to end the ban on offshore oil and gas drilling.

Last week GOP presidential candidate John McCain as well as President Bush called for ending the blanket prohibition on energy development over 80 percent of the country's offshore waters. Republicans contend that the offshore bans should be ended to allow for more domestic oil and gas production, an argument that has gained support with $130-a-barrel oil raising the cost of everything from food to air travel.

The House Appropriations Committee has postponed consideration of an Interior Department spending bill that included continuation of the offshore drilling ban. Republicans had prepared a proposal that would have ended the ban and allowed oil and gas development 50 miles from shore in all U.S. coastal waters.

http://news.yahoo.com/s/ap/20080624/ap_on_go_co/congress_gasoline

[Yurt]

isn't this a backdoor attempt at "capping" gasoline prices? if the US capped the prices, wouldn't that also be a hinderance to speculation trading?

[red states rule]

isn't this a backdoor attempt at "capping" gasoline prices? if the US capped the prices, wouldn't that also be a hinderance to speculation trading?

I did not make myself clear Yurt - my fault

Dems (and RINO'S) need to let the market work, and get the hell out of the way. Let the oil companies do what they do best - find, drill, pump, refine, and ship the finished product

I do believe Dems want gas prices to keep going up, and they do want to hinder the oil companies from solving the problem
All for political gain

[Yurt]

I did not make myself clear Yurt - my fault

Dems (and RINO'S) need to let the market work, and get the hell out of the way. Let the oil companies do what they do best - find, drill, pump, refine, and ship the finished product

I do believe Dems want gas prices to keep going up, and they do want to hinder the oil companies from solving the problem
All for political gain

oh, i did misunderstand, no worries...

don't you find it dishonest that the dems are out there blaming the oil companies, wanting to tax their so-called windfall profits and "now" saying that it is the oil speculators and that to fix this we must fix that...are the dems going to recant about the evil oil companies? nah, that would be tellign the truth

[red states rule]

oh, i did misunderstand, no worries...

don't you find it dishonest that the dems are out there blaming the oil companies, wanting to tax their so-called windfall profits and "now" saying that it is the oil speculators and that to fix this we must fix that...are the dems going to recant about the evil oil companies? nah, that would be tellign the truth

Again it was my fault for not m aking myself clear

Pres Peanut did it in the last 70's and it failed. Now Dems and Obama want to do it again thinking the results wil be different

Dems never saw a tax increase they did not fall in love with, and they never will change

[midcan5]

Gas could fall to $2 if Congress acts, analysts say

Red, thanks, by the way for the down payment on the beach front property in Montana. I'm sure you'll love it.

[red states rule]

Red, thanks, by the way for the down payment on the beach front property in Montana. I'm sure you'll love it.

Democrats do not want the price of gasoline to go down. They are doing their best to hit $5/gal gas before the election then force people to use public transportation. Then they will thump theior chests and say how we are reducing greenhouse gasses to combat the myth of global warming

[midcan5]

Huh! wishing is now a part of economics, who woulda thunked it.

[red states rule]

Huh! wishing is now a part of economics, who woulda thunked it.

Are the democrats coming up with a plan to lower global oil prices? What happened to the Pelosi promise 2 years ago to lower gas prices using common sense approaches? That was when gas was $2.50. I would like an update.

[Hagbard Celine]

It will take a decade to see any change from any new oil drilling off our coasts. I think we'd see a marginal shift in price from the initial news, but it would go right back up again after a couple of days.

[Yurt]

It will take a decade to see any change from any new oil drilling off our coasts. I think we'd see a marginal shift in price from the initial news, but it would go right back up again after a couple of days.

so i guess you don't believe in saving for retirement either

[red states rule]

It will take a decade to see any change from any new oil drilling off our coasts. I think we'd see a marginal shift in price from the initial news, but it would go right back up again after a couple of days.

and how long before the libs "alternative energy sources" kick in?

If we would have started drilling in ANWAR in 2000, like Pres Bush wanted, we would have over a million barrels a day flowing

Not to mention all the other oil that would be flowing from other drill sites

[avatar4321]

Huh! wishing is now a part of economics, who woulda thunked it.

And since when do you know anything about economics?

[avatar4321]

It will take a decade to see any change from any new oil drilling off our coasts. I think we'd see a marginal shift in price from the initial news, but it would go right back up again after a couple of days.

I bet price would change alot faster than you realize.

Besides, if we don't start now what the heck is the price going to be in a decade?

[red states rule]

And since when do you know anything about economics?

Given his posts, his knowledge of economics would fit in a thimble

[Dilloduck]

Renewable energy moguls are pushing gas prices to the point where Americans will angrily turn to them for sustenance !

( I just made that one up ) :laugh2:

[red states rule]

Renewable energy moguls are pushing gas prices to the point where Americans will angrily turn to them for sustenance !

( I just made that one up ) :laugh2:

The problem is easily solved. Dems need to shut up and get out of the way of the oil companies from doing their job

[PostmodernProphet]

the conundrum......oil drilling in ANWR is essential because gas is $4.....the OP argues that if we start drilling gas will go to $2.....if gas goes to $2 we don't need to drill in ANWR.....

[red states rule]

the conundrum......oil drilling in ANWR is essential because gas is $4.....the OP argues that if we start drilling gas will go to $2.....if gas goes to $2 we don't need to drill in ANWR.....

We need all the oil we can get. Now if McCain would smarten up and suppoort drilling in ANWAR he might get more support

[walkertom]

The key to lowering gas prices is to strengthen the dollar and hopefully drive the speculators out of Oil Futures Markets. I lieu of that...Congress could act.

[red states rule]

The key to lowering gas prices is to strengthen the dollar and hopefully drive the speculators out of Oil Futures Markets. I lieu of that...Congress could act.

It is a small part of the answer

Strengthening the dollar will not bring a single additional barrel of oil to market. We have to start tapping into our own oil and build refineries

[Hagbard Celine]

I bet price would change alot faster than you realize.

Besides, if we don't start now what the heck is the price going to be in a decade?

I don't think we'll still be haggling about this in a decade. When the price gets too high, we'll start using other fuel sources. It's already started. I think further drilling will just prolong the current state of things. The question is what to do in the immediate days to come in order to ease the pain--before necessity literally becomes the mother of invention.

[red states rule]

I don't think we'll still be haggling about this in a decade. When the price gets too high, we'll start using other fuel sources. It's already started. I think further drilling will just prolong the current state of things. The question is what to do in the immediate days to come in order to ease the pain--before necessity literally becomes the mother of invention.

No, we need to start the drilling. Why should we beg other coun tries to increase production when we have oil sitting in the ground within our own shores?

[glockmail]

The key to lowering gas prices is to strengthen the dollar and hopefully drive the speculators out of Oil Futures Markets. I lieu of that...Congress could act. Tapping US supplies will strengthen the dollar since we would be importing less products and thus exporting less dollars.

[glockmail]

I don't think we'll still be haggling about this in a decade. When the price gets too high, we'll start using other fuel sources. It's already started. I think further drilling will just prolong the current state of things. The question is what to do in the immediate days to come in order to ease the pain--before necessity literally becomes the mother of invention.
Like what?

[red states rule]

Like what?

Hag would be a great source of wind :laugh2:

[glockmail]

Hag would be a great source of wind :laugh2:
If you mean methane, that that is actually a good energy source. But the Democrats won't let us drill for it.

[Hobbit]

What's worse in this fuel mess is natural gas prices, which are also going up. Here's something that'll piss you off to the ends of the earth. Due to environmental lobbyists, it is illegal to ship natural gas through a pipeline (which could drive down prices). But wait, there's more. Ever hear of the Alaska Pipeline? Yeah, it was originally designed to pump both oil and natural gas, but when natural gas piping was outlawed, they had to cancel that plan. Natural gas comes out of most oil reserves, including the wells in Alaska. Due to the terrain and climate, they can't get it out of there and still make a profit, so they pump it right back into the well. That's billions of cubit feet of natural gas just sitting there, already ready to tap, but we can't get at it because of congress.

Another thing congress won't tell you is how the Democrats led the market to this futures nightmare, which, in fact, does contribute quite a bit to the price above and beyond what a typical market would. Because of the nature of futures, it used to be legal to buy futures on margin only up to 50% of the shares you actually bought. The Democrats allowed that provision to expire, and never made an effort to correct it. Now, you can buy futures at 90% on margin, meaning that there are a lot of people buying a lot more futures than they can really afford. If oil ever does drop suddenly in price, there are going to be a lot of floundering mutual funds, but if this regulation is put back into play they'll bail out before that happens.

[glockmail]

.... it is illegal to ship natural gas through a pipeline .... Wh-wh-what?

http://www.eia.doe.gov/pub/oil_gas/natural_gas/analysis_publications/ngpipeline/images/ngpipelines_map.gif

http://www.eia.doe.gov/pub/oil_gas/natural_gas/analysis_publications/ngpipeline/

[theHawk]

It will take a decade to see any change from any new oil drilling off our coasts. I think we'd see a marginal shift in price from the initial news, but it would go right back up again after a couple of days.

Even if that was true(which its not, drilling in offshore can get us oil in a year to three years, only worst case scenarios would it take up to 10) why would we not do it anyway? What ever happened to investing in the future? We send kids to school everyday, why? We won't see the results tomorrow or even in a few years. If you're saying if an investment that takes ten years is not worth it, then why support any type of education?

[5stringJeff]

Strengthening the dollar will not bring a single additional barrel of oil to market. We have to start tapping into our own oil and build refineries

I certainly think we should begin drilling more domestically, but a stronger dollar will lower the price of oil, which would actually allow us to buy more of it.

[red states rule]

I certainly think we should begin drilling more domestically, but a stronger dollar will lower the price of oil, which would actually allow us to buy more of it.

If we turn the oil companies loose to drill (and increase refinery capacity) the price of oil (and gas) will drop, the economy will strengthen, and the value of the dollar will increase

[midcan5]

And since when do you know anything about economics?

Maybe I could wish I did. :laugh2:

[gabosaurus]

The original hypothesis, taken by RSR from an extreme right-wing source, is complete and total bullshit.
My husband is an economic adviser and analyst. He would laugh at all the inaccuracies in that statement. Who came up with this tripe?

[red states rule]

The original hypothesis, taken by RSR from an extreme right-wing source, is complete and total bullshit.
My husband is an economic adviser and analyst. He would laugh at all the inaccuracies in that statement. Who came up with this tripe?

So Marketwatch is a right wing source?

Perhaps you missed the point of the thread Gabby - I disagreed with caps and government interference to solve the issue of high oil prices

The free market can correct the high oil prices, if both parties will get out of the way