why is gas so cheap?

[hillary supporter]

why has gas dropped so much? im bewildered, can someone give me some insight?

[Keith-N-Jax]

Probably because of the holiday shopping season has approached. IMO. I dont believe this hype about the demand is down. Its always about money.

[MattnJax]

Because there's a global recession happening. Oil was so high because of speculation about demand in the future outweighing supply, so it drove up cost. Now that economies around the world are hurting, the demand for oil isn't as high. I just hope that we don't stray from trying to get off our dependence from oil now that the price is going down. We need to still develop alternative sources and do it fast. I believe Obama is the right man to get it done, but it's going to take all of us.

[Coolyfett]

Because there's a global recession happening. Oil was so high because of speculation about demand in the future outweighing supply, so it drove up cost. Now that economies around the world are hurting, the demand for oil isn't as high. I just hope that we don't stray from trying to get off our dependence from oil now that the price is going down. We need to still develop alternative sources and do it fast. I believe Obama is the right man to get it done, but it's going to take all of us.

MATT FOR PRESIDENT 2016!!!

Man I could not agree more, and people should not change their driving habits!!

The gas is down due that stock crash that happened a month ago. When all that stock dropped, the gas prices started going down like a 3 cents a day. in a month it went from 4.05 gal to 1.84 gal....IN A MONTH, people that invested in oil stocks lost a lot of money. They are trying to get that money back, so to get people buying gas again, they lower the price and hope that we will drive more and buy more gas. Many have taken the bait. And it sucks, because these dumb ass car companies won't make the giant sized power wheels they need to be making, they still want to build gas drinkers. no one is buying and now they want 25 BILLION from the government!!!! Its a friggin set up. Gas companies and car companies are in cahoots. Anyone on that side of the fence is totally against mass transit which was a topic that was red hot when gas prices were high, now its low and mass transit talk is going away. They are playing this game with all of us. Some of us are too dumb to see what it going on. Cars need to be electric and mass transit should be an alternative. These are needs for planet earth, not just America.

[Keith-N-Jax]

I agree with you both, but as long as there money to be made, things will not change.

[chipwich]

Gas is down because of a few reasons.

1.  Worldwide recession has caused global demand to drop below supply.  Economic rule:  When demand is higher than supply, the product goes to the next highest bidder.

2.  Banks are broke.  Most people don't actually buy physical oil, rather they contracts for oil in the future (usually 1-3 month forward contracts).  Banks are however broke and are unwilling or unable to lend investors, users, and hedge funds the margin funds needed to buy these contracts.

3.  The stock market crashes around the world has caused investors (chiefly US investors) to withdraw money from foreign markets and retrench them back into US bonds.  This has caused a hugh run on the dollar.  As the dollar has risen, the attractiveness of oil as a hedge against inflation has gone down.  So expensive dollar means cheaper oil.

Hope this helps.

[jaxnative]

This will be interesting.  For the consumer, the drop in gas prices has been one of few upsides of the current economic situation.  Fuel prices and energy costs will be important to any rebound in the economy.  Unfortunately, with this incoming administration combined with the merry band of idiots who now sit in Congress, I have a feeling we will be seeing calls for new energy taxes if prices remain low.  It will be part of a series of actions which will have the same effect as New Deal socialistic policies which prolonged the effects of the Great Depression throughout the 1930's. 

[Bostech]

Bush made it happen,he pulled his lever on side of his Lazyboy and prices of oil went down.

[BridgeTroll]

Bush made it happen,he pulled his lever on side of his Lazyboy and prices of oil went down.

Must be true... that is what you said when they went up...

[gatorback]

Whatever. This goes far beyond such agreements. BP, Exxon Mobil, Shell have reportedly secured rights of first refusal on 30-year production contracts in Iraq's vast oil reserves.  What this means, we found out, the Iraq war is largely about oil.  Now that we own these oil reserves there's less speculation and with less speculation there is the drop in prices.

[BridgeTroll]

ok...whatever

[gatorback]

that was for Bostech, you just posted between when I typed it and before I submitted it.

I think the gas tax in china is actually going to curb demand as well and push oil lower.

[BridgeTroll]

that was for Bostech, you just posted between when I typed it and before I submitted it.

I think the gas tax in china is actually going to curb demand as well and push oil lower.

Sorry

[I-10east]

Why is gas so cheap??__Who cares; I just hope that it stays that way for a good while. OPEC isn't done screwing with us yet, so don't get too happy; Screw you OPEC, with this see-saw game!! Americans NEED to find ways to get gas (alternate sources etc.) outta this country, instead of others.

[fsujax]

Maybe its just old fashoined economics at play here. Less demand=cheaper price?? just a thought.