It might have started a couple months earlier, but this is eerily similar to the summer of 2008 when gas prices were at record highs, which is around $4 per gallon. Back then, congress proposed a bill to regulate oil speculation, but nothing came of it. It was shelved when people fought back by driving less and using alternative methods of transportation, lowering gas prices to the point where it no longer became an issue.
As recent as last April when gas prices reached near all-time highs again, Barack Obama put the Justice Department on oil speculators. Again, nothing much happened. No significant laws were passed, and I didn’t see any news on speculators being put behind bars. People just stayed home instead of traveled. By late June, gas prices have eased a bit and eventually became a non-issue again.
Well, it’s April, and guess what? Gas prices are going up and reaching $4 a gallon. It’s election year and time for another attempt by Obama to end oil speculation. This time, he’s pitching a $52M plan that’ll put “more cops on the street” to catch speculators who bet on oil and drive up their price.
I hope this time, it’s for real. But you know what? I suspect like the years before, nothing much will come of it. People will just drive less and use other forms of transportation that’s not reliant on gas - like walking, biking, and using public transportation. Demand for gas will decrease, oil speculators will get scared and stop betting on oil. Gas prices will go down, and the whole process will start all over again next year.
I’ve noticed that there’s a relatively close correlation between the price of gas and the economy. When there are good economic reports, gas prices will go up a week or so later. It’s no accident we’re seeing higher gas prices recently because the economy has improved recently. Speculators are probably betting that people will drive more when they earn more or have a job.
