Oil prices, seems like talking heads are spinning the low oil prices to put tariffs on imports. The tariffs will go to the government, who we dont trust and, will mean higher prices at the pump which we all will pay for. If we do believe in a free market, let the market set the prices. The vast majority of Americans will benefit from lower gas prices. A few weeks ago I wrote why oil prices were (are) dropping and, I will state part of that again. Russia, China and India agreed to not use the US dollar as the trade currency of the world, had they been able to relegate the dollar to a secondary currency, it would have been disastrous for us. Saudi Arabia uses the dollar to sell oil and, the above scenario would have crippled them as well as their oil wealth is measured in dollars. The economy world wide has slowed down and, at the same time world oil production has gone up. The last time this happened, Saudi Arabia cut production to keep up ( prop) oil prices. When they did this, all oil producers profited at Saudi Arabias move except Saudi Arabia, they lost market share,. The Saudis opted to not cut production and, maintain their market share. Had they cut oil production this time, the three country axis would have been strengthened and they would have been in a better position to topple the dollar, which in turn would have hurt the Saudis as well as us.
Posted on: Sat, 03 Jan 2015 03:35:33 +0000
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