08 July 2011

Oil Stimulus Drains Away.

I woulda never thought it...
The White House decision to sell 30 million barrels of oil from the Strategic Petroleum Reserve has failed to stop the upward march of oil prices, or to stimulate the economy.
 
 Prices for crude oil and gasoline dipped on the June 23 announcement, but have subsequently risen because expanding economies in Asia and South America are bidding up the market price, according to oil industry analysts. 
President Barack Obama’s sale “did not make a damn bit of difference,” said Dan Kish, vice president for policy at the Institute for Energy Research. Eight days after the announcement, “the price of oil was higher than it was the day he announced” the release of oil from the reserve, Kish said. 
Oil prices fell roughly $4 a barrel to roughly $91 a barrel when the announcement was made. Since then, prices have climbed up to near $100 a barrel, according to an (sic) July 7 AP news report. Gas prices rise and fall in line with oil prices, and the national average price nudged up 1.4 cents on Thursday to reach $3.58 a gallon, according to AAA and the Oil Price Information Service. That’s a price increase of 4.2 cents per gallon from a week ago. 
“Crude prices are back to where they were,” said Rayola Dougher, senior economic adviser at the American Petroleum Institute. “It was just a temporary blip.” 
Prices won’t come down, she said, until the federal government allows greater use of new energy resources being found in the United States and Canada. We need policymakers to face the facts, and make sure we have reliable, affordable supplies of fuel,” she said. 
The oil sale was another of the administration’s many regulatory and legislative efforts to jump-start the economy. These include the $787 billion economic stimulus in 2009, the ‘cash-for-clunkers” deal, the economic aid package given to General Motors and Chrysler and the “quantitative easing” money-creating policy adopted by the Federal Reserve. 
However, the economy remains stalled, and unemployment remains at 9.1 percent. In May only 36,000 new jobs were created, even as young people and immigrants boost the overall labor-force by roughly 100,000 people.
And that's what I would call a "well, duuuh" moment.

1 comment:

  1. As I pointed out previously: Just exactly what was adding <.1% to the World’s annual consumption supposed to do anyway? Is B.O. correct in his apparent assumption that we, collectively, are a bunch of fools?

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