Bryan Kautzman

Who's Kidding Whom on Gas Prices?

I love it when people attack the parts of the industry that have the smallest profit margins and blame them for the high prices we pay at the pump. Of course, I'm talking about the refiners and the retailers.

Watch for Yourself: 60 Minutes Oil Story Was Spot On

Would you care to expand upon this?


On Jan 14 12:26 PM Geoff Considine wrote:

> This article and the following discussion shows how much misinformation
> is floating around about what drives commodity prices. Perhaps the
> saddest thing is how many people weight in on commodities markets
> without really understanding them--including politicians. As is so
> often the case, the dialog/comments are even more interesting than
> the article.

Watch for Yourself: 60 Minutes Oil Story Was Spot On

What most people don't understand is that when oil hit $147, bailout checks were being mailed and the conomy was still, on a day to day basis, fundamentally sound. If the market hadn't crashed, the price might still be rising. However, it might also be noted that the rising price contributed to the crash. It was one of those perpetual circles where something had to give.

The price of oil will recover with the economy. The bigger problem, as I see it, is that the entire energy sector collapsed with oil.

Oil Price Economics the 60 Minutes Way

Of course, everyone is mad that gas was selling for $4 a gallon last summer. Americans believe that they have been endowed by their Creator with the unalienable right to drive, and that the oil they use to fill their tanks should be cheap. Of course, as the price of oil went up, up, and up, smart investors were taking advantage of it. And when the price started getting close to $150 a barrel, smart investors started to take their gains. So, from the sounds of it, that Sixty Minutes quote, unquote "expose" was stopping just short of calling me a criminal.

I just wish I had been smart enough to short oil when I took most of my money out in July.