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Tuesday, May 09, 2006

Oil at $100 per barrel prices...

Posted on MSNBC and Newsweek by Karen Lowery Miller

Karen Miller did up a great piece on the reasons why oil prices could hit $100 per barrel in the near future and she tapped on all the right points. The future for the world and this source of energy is looking rather bleak and all it takes is two idiots on the world block to fight a war and POW! The world goes into an energy crisis. There is so much turmoil in the world over oil that it is no longer funny. Everyone is out to get their piece of the action and whoever gets the most wins the game.

Throw in politics where one nation holds back the liquid gold from another to manipulate any situation and you have the potential for conflict. The Russians did just that with one of their own neighbors recently. Uncle Hugo Chavez down in Venezuela is using his state run oil as a political sword at an American Presidents throat by selling cheap oil to New England states this past winter. Iran, a country that sits on one of the worlds largest oil reservoirs is aggressively seeking nuclear power for what they say is for peaceful power generation purposes. I would just be assuming they don’t have the technology yet for oil fired power plants yet. All the countries around the world with the oil under their feet will become the school yard bullies poking and punching those of us that have the addiction for oil. The list can go on and on. Now add to it all that the Chinese people are becoming an energy using superpower in line with the United States of America.

Toss any situation you want into the scenario and futures traders are going to run the price up well over $100 per barrel into the $300 or $500 range. That is what they do. They gamble based on scenarios happening today around the world that the price for oil will go up. The traders will become millionaire’s, the oil company executive’s billionaires and the people sitting on the oil will have the last laugh as they turn the deserts of the world into cash beyond belief.

Human nature or should I say American nature is a funny trait to have. We take our punches from all the countries around the world because we believe in a free society which means we believe in free markets. We’ll take a jab in the side at the gas pump today. We’ll even take a kick in the shins paying the heating bill next winter. Eventually, somewhere in this great land of ours is a NASCAR fan that likes to play with carburetors that will find a way for it to get one hundred or two hundred extra miles per gallon out of it for his Chevy. He or she doesn’t care for jabs in the side or kicks in the shin. An immigrant from India living in this country will come up with a formula for Ethanol that will make oil no longer the gasoline of choice. He or she doesn’t care for jabs in the side or kicks in the shin. Some ingenious college egg heads that have two mortgages on each of their houses are working out of a garage will break the latest alternative energy barrier for powering your home. They too don’t care for jabs in the side or kicks in the shin. This list will go on and on and on. Americans hate to have a sword at their throat but they really despise someone holding them ransom at the pump. Was it Newton that said for every action there is a direct opposite reaction? We like to call it good old American ingenuity.


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2:30 AM  

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