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I could not believe my eyes today, gas at $2.87!
I remember this summer I was driving home from the beach and noticed the rural (which is always lower than suburban) prices for gas were $4.07 and thought that was low.
So, we are all happy, but OPEC is not. Most OPEC nations lack diverse economics and rely heavily (sometimes 90$ of government revenue) on oil prices and in recent years have gotten used to high oil prices to finance their projects. But the recent economic crisis has lead to a decline in quantity demand, leading, of course, to a decline in oil prices. From July oil has dropped 50% in price from $147 to now less than $70.
To buck any further declines, OPEC has today held a meeting stating its commitment to cut production to at least prohibit any further declines if not re-raise the price of oil. But will it work? First, the two nations most worried about a decline in oil prices are Iran and Venezuela. They both need oil at $79 a barrel in order to meet government spending plans.
Saudi Arabia, in turn, only needs oil at $49. And because Iran and Venezuela cannot afford to make cuts on their own (thus forgoing revenue) they will need Saudi Arabia to do most of the cutting. Given that, so far, the Saudis are not too troubled by oil prices and that they probably want to see their rival Iran undermined, it is unlikely the Saudis will make any significant cuts. Further, the Saudi probably do not want to displease the United States by cutting production too much.
Finally, Adam Smith has a rule about cartels: greed will eventually break up any effort at price fixing. In the past OPEC countries have cheated production cuts in order to benefit from increased prices, once one nations finds the other has cheated, it then increases production, and so on and so forth until the entire reason d’etre of the production cuts collapses and oil production returns or exceeds its normal rate of productions. And, of course, the consumers win!
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Its soo funny All muslims try to preach the world Jews are evil because of their interstEarning/money lending. Heres a thought every bank ever major company in the US is working with borrowing money and then making profits with that money and paying back interest. So the jewish policy and workings of interest aren’t evil. For example lets say you dont know how to use a stove and you burn your hand; its not the stove maker who is evil, its your own stupidity that you don tknow how to use the stove to make a meal. Similarly every corporation even governments borrow money on interest and then return tha tmoney after making a profit.
Meanwhile most of these middle eastern states that produce oil; they know how important oil and gas is for human survival in todays day and age. But these countries always try to sell this gas at such a higher price to us non-muslim countries that we can’t afford to travel to work in some cases. The price of food goes up soo much when these freaking oil prices go up; we can’t buy things cause most of the money we are spending on this damn oil that these middleeaster countries have in abanduance (almost like water). In their own countries (middle eastern countries/ middle eastern states) oil is soooo cheap; i checked when i was in quwait to fill a tank costed $17 to fill the same tank here costed freaking $95. So who is the real blood sucker?? Atleast with jews giving us money on interest i can get my business growing; but the middle easter nations know that raising the prices is only going to put a choke on the lives of innocent people but they dont care.
I dont see jews to be the bloodsuckers.
Middle eastern countries dont have much vegetation but food their is cheap too because the food producing nations are very nice to the middle east and dont jack up the prices. I say if middle east jacks up price of gas for the world the world should get together and raise the price of food x10 on middle east and make them pay in oil instead of cash.