Good job getting a handle on the fraud in the oil industry, chief.

by wfgodbold

Never fear, the president is on the job, and he’ll root out the cause of high gas prices!

That was last Thursday. Today, I look at the news and see:

EPA Rules Force Shell to Abandon Oil Drilling Plans

Yep. Those evil oil companies are defrauding the public again!

The media is complicit, willing to paint speculators and Big Oil alike with the blame.

Speculators in the oil market work just like in any other market; if one person is buying next year’s oil at $150/gal, that means someone else is selling it at that price. For every dollar a speculator makes, some other speculator loses a dollar.

I don’t begrudge the oil companies their profit; it’s a capital intensive industry (derricks, refineries, tankers, etc. aren’t free). I do find it ridiculous that the government is accusing Big Oil of profit gouging on the one hand and simultaneously causing them to waste billions of dollars by not allowing drilling. You want to know why the price of gas goes up? They have to make that money back somehow, and they’re not going to get any of it back by selling the oil they weren’t allowed to drill for.

You want to know why the price of gas (and oil, and damn near everything else) has doubled?

Inflation.

When the dollar is only worth half what it was, then of course it takes twice as many of them to buy the same stuff.

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