one explanation of gas prices

This is a commentary from an "expert" from MSNBC. It mentions the
commodities market as a large factor in the gas prices.
http://www.msnbc.msn.com/id/14891597/

Could be right as I have suspected, or it could be pure bull.

morticide wrote:

> This is a commentary from an "expert" from MSNBC. It mentions the
> commodities market as a large factor in the gas prices.
> http://www.msnbc.msn.com/id/14891597/
>
> Could be right as I have suspected, or it could be pure bull.

You mean the American media have just discovered the impact of futures market
and that worldwide prices aren't set by the USA ?

Graham

An article in the Wall Street Journal from several months ago surprised
me by treating the commodities-market-driven nature of petroleum prices
as a fairly new thing. In other words, the concerns of the trading
pit, rather than direct supply-and-demand issues, dominate its price
trends. I'd have guessed that to be true for a long time, but
apparently not. They seemed to nod with approval at this development,
considering it to be another market reaching some new level of business
maturity.

--Joe

Ad absurdum per aspera wrote:

> An article in the Wall Street Journal from several months ago surprised
> me by treating the commodities-market-driven nature of petroleum prices
> as a fairly new thing. In other words, the concerns of the trading
> pit, rather than direct supply-and-demand issues, dominate its price
> trends. I'd have guessed that to be true for a long time, but
> apparently not. They seemed to nod with approval at this development,
> considering it to be another market reaching some new level of business
> maturity.

Oil futures do possibly take some of the strain but at the end of the day the
long term supply and demand situation will prevail of course.

Graham

In article >,
Eeyore > wrote:
>
>
>morticide wrote:
>
>> This is a commentary from an "expert" from MSNBC. It mentions the
>> commodities market as a large factor in the gas prices.
>> http://www.msnbc.msn.com/id/14891597/
>>
>> Could be right as I have suspected, or it could be pure bull.
>
>You mean the American media have just discovered the impact of futures market
>and that worldwide prices aren't set by the USA ?

Why don't you just go hang out at alt.nuke.the.USA?

The column (which clearly you haven't read) is not by an expert from
MSNBC, but rather by one of their senior producers. It's an attempt
to debunk the conspiracy theory that Bush is making gas prices go down
to influence the November elections. It's written in a rather
patronizing tone, implying about those who believe that about what you
imply about the media.

Matthew Russotto wrote:

> Eeyore > wrote:
> >morticide wrote:
> >
> >> This is a commentary from an "expert" from MSNBC. It mentions the
> >> commodities market as a large factor in the gas prices.
> >> http://www.msnbc.msn.com/id/14891597/
> >>
> >> Could be right as I have suspected, or it could be pure bull.
> >
> >You mean the American media have just discovered the impact of futures market
> >and that worldwide prices aren't set by the USA ?
>
> Why don't you just go hang out at alt.nuke.the.USA?
>
> The column (which clearly you haven't read)

I did read it in fact.

Graham

Eeyore wrote:
>
> Ad absurdum per aspera wrote:
>
>> An article in the Wall Street Journal from several months ago surprised
>> me by treating the commodities-market-driven nature of petroleum prices
>> as a fairly new thing. In other words, the concerns of the trading
>> pit, rather than direct supply-and-demand issues, dominate its price
>> trends. I'd have guessed that to be true for a long time, but
>> apparently not. They seemed to nod with approval at this development,
>> considering it to be another market reaching some new level of business
>> maturity.
>
> Oil futures do possibly take some of the strain but at the end of the day the
> long term supply and demand situation will prevail of course.
>
> Graham
>
Once the speculators move on it will.

jcr wrote:

> Eeyore wrote:
> > Ad absurdum per aspera wrote:
> >
> >> An article in the Wall Street Journal from several months ago surprised
> >> me by treating the commodities-market-driven nature of petroleum prices
> >> as a fairly new thing. In other words, the concerns of the trading
> >> pit, rather than direct supply-and-demand issues, dominate its price
> >> trends. I'd have guessed that to be true for a long time, but
> >> apparently not. They seemed to nod with approval at this development,
> >> considering it to be another market reaching some new level of business
> >> maturity.
> >
> > Oil futures do possibly take some of the strain but at the end of the day the
> > long term supply and demand situation will prevail of course.
> >
> > Graham
>
> Once the speculators move on it will.

That depends on the length of their options for one. They won't exercise them if
they'll make a loss.

Graham

Matthew Russotto wrote:
> In article >,
> Eeyore > wrote:
> >
> >
> >morticide wrote:
> >
> >> This is a commentary from an "expert" from MSNBC. It mentions the
> >> commodities market as a large factor in the gas prices.
> >> http://www.msnbc.msn.com/id/14891597/
> >>
> >> Could be right as I have suspected, or it could be pure bull.
> >
> >You mean the American media have just discovered the impact of futures market
> >and that worldwide prices aren't set by the USA ?
>
> Why don't you just go hang out at alt.nuke.the.USA?
>
> The column (which clearly you haven't read) is not by an expert from
> MSNBC, but rather by one of their senior producers. It's an attempt
> to debunk the conspiracy theory that Bush is making gas prices go down
> to influence the November elections. It's written in a rather
> patronizing tone, implying about those who believe that about what you
> imply about the media.

I'm curious - if you are of the opinion that retail gasoline prices can
be manipulated by the executive branch of the US government can you
explain using economics how this is done?

If not, then can you provide an alternative explanation to what is
described in the article?

js

In article .com>,
js > wrote:
>
>Matthew Russotto wrote:
>>
>> The column (which clearly you haven't read) is not by an expert from
>> MSNBC, but rather by one of their senior producers. It's an attempt
>> to debunk the conspiracy theory that Bush is making gas prices go down
>> to influence the November elections. It's written in a rather
>> patronizing tone, implying about those who believe that about what you
>> imply about the media.
>
>I'm curious - if you are of the opinion that retail gasoline prices can
>be manipulated by the executive branch of the US government can you
>explain using economics how this is done?

The most direct and aboveboard way is through petroleum purchases into
and/or release by the Strategic Petroleum Reserve. However, sneaky
ways abound. Stricter interpretations or changes of regulations
relating to gasoline volatility and contents. Inspections of
pipelines using somewhat harsher criteria than normal. Or just a
whisper in the ear of oil company executives that they'll find the
government a lot friendlier in the future if they take a certain
actions now.

Heavy-handed ways including refusing to allow supertankers to dock,
shutting down offshore platforms on some pretext, imposing an embargo
on an unfriendly oil-exporting country, etc.
--
There's no such thing as a free lunch, but certain accounting practices can
result in a fully-depreciated one.