Fuel prices

I'm curious to know how he can predict what the demand will be in one to two years....

 

Same way the idiots on Wall St. predict futures that never come to fruition and cause countries to panic, along with the citizens, whipping up this mass hysteria that is all for naught.

 

The price of fuel will largely be determined by the value of the dollar. As the dollar continues to fall, oil will continue to increase.
We have pumped nearly 2 trillion dollars into circulation in the last two years. This is what causes inflation.
Our annual inflation rate right now is in excess of 18%.
So depending on who you listen to, expect an annual inflation rate by this time next year of between 24% and 50%.
Prices lag behind inflation. Before a bunch of you post about the government CPI showing inflation at 3% or so, remember...the CPI is NOT the inflation rate. It is a government contrived index of 100 items the consumer buys indicating historical prices. Inflation is the relational index of cash in circulation vs GDP. As they continue to print money, they inflate the money supply, devaluing the cash on hand and resulting in price increases.
The CPI is manipulated by the government to hide inflation. An example is how they have changed some of the items on the list so we don't see actual price increases. This would include men's shoes. Originally the shoe listed was made in the US. Now they use a shoe made in the far east. There was a recent change in milk, and gasoline, but I can't remember the details.
So $5 gas in the next year is not unreasonable to expect.
This administration has said from before it's election, that we should be paying prices akin to the rest of the world.
That would put gas at somewhere between $8 and $10 on today's market.

 

His prediction for future demand may be a little off due to the following:

Outlook 2011: China Says No More Cars, Down Goes the Auto Industry

 

Because all those oil exec's get together in a luxury resort somewhere (overseas) and decide to raise prices.

Illegal yes ... but don't think it doesn't happen.

Not to mention the gazillionaire speculators who jump on oil commodities every time they think they can make a quick extra billion.

 

A falling dollar sure enough will help drive up prices, as it falls it will take more $ to buy the same amount of fuel. But an oil exec making a public statement about a dramatic price increase around the corner, IMO, is not too intelligient. This cannot help the economy. Wonder who the nutjobs will blame it on now since GW the "oil man" is gone lol.

 

What he doesn't figure into the equation is that as the price increases demand falls and the market will only bear what it will bear.
Last time when fuel prices spiked they were predicting $10 a gallon gas and it never got close because the market won't bear it.

We'll see what happens when it happens.

 

One thing the oil rich countries don't have much of is food. If they jack the price up on oil then we should double the cost of wheat, corn and other exports to them countries. What's good for the goose is good for the gander.

One reason our gov't is pushing for electric cars is they know what the future is on oil. We are way too dependant and are like a druggie looking for a crack rock. We just got to have it.

You can try to hide a depression, but it's inevitable the way things are going. We will see one in the near future and many won't be prepared for it. This last little deal was just a wake up call just like what happened a couple years prior to the great depression. The president pumped money into the economy and things started looking good then it happened. History is repeating itself.

 

Oil prices are pumped up by 1 thing, greedy traders on wall st plain and simple. We have had record oil levels for the last year put they keep saying supply and demand, bs the demand is no where near what it was a few years ago. And as far as oil running out we have more oil in this country than we know what to do with we just have to get it, but the tree huggers would rather the country go down the drain rather than drill for oil. Watched a show about oil last week and the guy they interviewed said oil is about $20 to $25 a barrel higher than it should be all because of speculation, if you got rid of oil speculation trading on wall st it would be around $65 a barrel.