Newt's Despicable Gasoline Price Promise

Newt Gingrich imagines he can command the law of supply and demand.

Former House Speaker and current Republican presidential hopeful Newt Gingrich has promised voters that gasoline will be $2.50 per gallon after he becomes president. In fact, Gingrich thinks he may even be able to get the price down to $1.20 per gallon. "His promise to go the moon is easier to achieve," says Michael Lynch, president of the oil consultancy Strategic Energy and Economic Research. "We may see $2.50 per gallon gas again, but not because of anything that any president does." Gingrich’s pitch is attractive to consumers who are confronting pump prices that average $3.83 per gallon and which are expected to go even higher later this year. Why doesn’t Gingrich promise free daily ice cream and cake for everybody while he’s at it?

Sadly, Gingrich has apparently gotten some traction among voters with his specious promise. After all, who does not hate high gas prices? A recent Washington Post/ABC News poll reports that two-thirds of Americans disapprove of how President Barack Obama is handling the gasoline situation. In addition, only 38 percent approve of his energy policies, down from 55 percent in August 2009.

Why are gasoline prices going up? It’s simple—because oil prices are going up. The price of crude oil accounts for about three-quarters of the price of a gallon of gasoline. Taxes account for another 12 percent or so; refining is about 6 percent; and transportation and distribution is another 6 percent. So what accounts for the higher price of petroleum? Again, it's simple: demand and supply.

Gingrich and others point out that actual U.S. consumption of gasoline is down by 7 percent since 2008. Cars are more efficient and people are driving less due to the slack economy. In addition, domestic crude oil production is up and gasoline inventories are ample. So why are prices still going up? 

Since the impersonal forces of demand and supply are not sufficiently evil, consumers and their politician enablers cast about seeking malefactors to blame for their pump pain. Enter the speculators. Taking a page out of the usual playbook, President Obama ordered the U.S. Justice Department to “reconstitute” the Oil and Gas Price Fraud Working Group to look into possible criminal behavior and misconduct in oil markets.

Of course, this is the same working group that the president established last spring to investigate the role of speculative malfeasance in higher gasoline prices at that time. Gas prices later dropped over the summer and the working group never issued any reports. It’s all a bit of policy theater designed to distract the plebes and deflect blame from the administration. As it happens, a report by the Federal Trade Commission issued in September of last year noted that while there has certainly been a huge increase in speculative interest [PDF] in oil futures, the FTC could find no clear link between a bigger futures market and higher oil prices.  

While Obama engages in another round of policy theater, would-be President Gingrich says that he can cut the price of gasoline by opening more federal lands and offshore areas to drilling; allowing the construction of the Keystone pipeline from Canada; and popping the speculative bubble by releasing crude from the Strategic Petroleum Reserve.

While it is true that the Obama administration has ruled out drilling on vast areas of the federal estate, the number of oil and gas rigs operating in the U.S. has nonetheless increased markedly in recent years. Indeed, it is not surprising that as the price of petroleum soared so too did the number of drilling rigs. The oil and gas rig count has increased to more than 1,900, up from around 700 [PDF] in 2000. As an historical note, the total number of U.S. oil and gas rigs peaked at more the 4,500 [PDF] in 1981.

The president was also a step ahead of the former House speaker since he opened the spigot to release 30 million barrels of crude from the Strategic Oil Reserve last summer in an effort to drive down gasoline prices. However, the price of gasoline had already begun falling from its peak in May. It's true that last year Obama blocked construction of the Keystone pipeline, which would have begun transporting in 2013 more than 400,000 barrels of oil per day derived from Canadian oil sands. Adding more supply certainly tends to put pressure on prices, but this still would have only increased daily global supplies by less than one half of 1 percent.

Gingrich has also argued, “We've seen an explosion of opportunity in natural gas through drilling. The result is the price of natural gas has dropped from $8 per 1,000 cubic feet to under $3 per 1,000 cubic feet.” He then reaches the conclusion: “You apply that same principle to oil—you would actually lower the price of gasoline below $2.50. I would be very cautious at $2.50. It would be down in the $1.20 range.”

Until recently the prices of natural gas and oil have moved in tandem, but fracking shale gas has so increased the supply of natural gas that the result is a dramatically lower price. Once sold on long-term contracts linked to the price of oil, more and more natural gas is purchased in spot markets. However, this delinking of natural gas from oil prices occurred in the U.S. largely because natural gas can be transported largely to the domestic market. Gingrich ignores the fact that oil is traded and its price set in the global marketplace. So unlike natural gas, the relevant supply and demand situation is international, not domestic.

While Gingrich is right that domestic demand for oil is down, global demand is up. In addition, global crude prices start rising when global spare production capacity begins to drop below the threshold of 3 million barrels per day. Spare capacity prevents and cushions price shocks. During the 2008 price run-up to $147 per barrel, global spare oil production capacity fell to as low as 1 million barrels per day. 

If Gingrich wants to lower oil prices, perhaps he should stop his saber-rattling against Iran. “If there’s an effective diplomatic outreach here that pushes back the prospect of a military confrontation with Tehran, we probably have something on order of $20-$30 a barrel geopolitical risk premium that could drop out of the oil price very dramatically,” wrote Tim Evans, energy analyst at Citi Futures Perspective in New York in the Financial Times. Oil consultant Lynch agreed. "The recent run up the price of oil is almost completely the result of concerns about losing Iranian oil or Iran attacking shipments in the Strait of Hormuz," he says.

The coordinated boycott of Iranian oil being spearheaded by the United States is increasing uncertainty in the global oil market. An attack on Iran to stop its nuclear program would clearly disrupt oil supplies. There is not enough current spare global production capacity to make up for the loss of Iran’s 3.5 million daily barrels of oil. Lynch believes that as the Iranian situation drags on, crisis fatigue will set in among oil traders. He also points out that global production capacity is increasing. Thus Lynch predicts that the price of crude will likely drop back to $90 per barrel and the price of gasoline to around $3.25 per gallon by the end of the summer. 

Lying to voters about his power to command the law of supply and demand is as close to despicable as anything I can imagine. Well, actually not. But it's still pretty despicable. 

Ronald Bailey is Reason's science correspondent. His book Liberation Biology: The Scientific and Moral Case for the Biotech Revolution is now available from Prometheus Books.

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  • Sevo||

    "Newt Gingrich has promised voters that gasoline will be $2.50 per gallon after he becomes president."

    And TWO chickens in every pot, dammit!

  • ||

    The key to this statement is understanding that Gingrich will never be president.

  • Sevo||

    The sad part is that one of several others who should be on the list *will* become president. And offer the similar lies.

  • ||

    He knows he can't bring gas prices down; he's using it to hammer Obama because prices are high right now. I'm ok with that if it hurts Obama.

  • ||

    I wonder if gas would be cheaper if we just annexed a couple of oil-producing nations? Maybe that's what he has in mind.

  • ||

    He could start with North Dakota.

  • ||

    They're pretty tough, and they have nukes.

  • ||

    Nobody said it would be easy. It would almost be easier to ride your bike instead.

  • Realist||

    Actually they do.

  • ||

    Apparently, there are nitwits who will say dumb things like "we cant get lower gas prices" (even though we could if we opened up more oil supply) because they deep down want to help out Obama.

    These are the nitwits who oppose ANWR drilling but are fine with flushing billions down the drain for Solyndra-like boondoggles.

  • Chupacabra||

    Who cares about chickens?

    Two mistresses in every bed!

  • Ron Paul||

    United States Virgin Islands Republican caucuses, 2012
    Candidate Votes Percentage Unbound Delegates Delegates
    Ron Paul 112[3] 29.2% 1 1
    Mitt Romney 101 26.3% 6 7
    Rick Santorum 23 6.0% 0 0
    Newt Gingrich 18 4.7% 0 0
    Uncommitted 130 33.9% 2 1
    Unprojected delegates:[4] 0 0
    Total: 384 100% 9 9

  • Thomas Sowell||

    Well, Gingrich could bring the price of gas to $2.50 with price controls. Reducing the cost of gas is the hard part.

  • Richard Nixon||

    Price controls?

    I like that idea!

  • Jimmy Carter||

    Me too!

  • Tony||

    Me too!

  • Harry Truman||

    Me three!

  • Matt Tanous||

    The other lie is that the price of oil is going up. In anything but fiat currency, it's been going down. A silver dime a few years ago would buy four gallons, now it buys eleven. The inflation caused by the Fed (which conveniently ignores energy costs) is a large reason why gas prices aren't just "up a bit" now, but up nearly 10% year-over-year.

  • ||

    I think you meant a silver eagle, not a silver dime.

  • Mike M.||

    But the government, Alfred E. Krugman, and the lefties keep telling us that we have deflation, not inflation.

  • The Derider||

    Not in "anything but a fiat currency" by a long shot. In 1990, a ton of wheat would buy about 145 gallons of gas. Today a ton of wheat buys about 73. Wheat has lost half its purchasing power. Why? Because demand has increased for oil more than it has for wheat, and it's harder to increase production of oil than wheat.

    The reason silver buys more gas today than a few years ago is that the price of silver has risen versus everything, not just the dollar.

  • Taoist||

    Okay. Now lets talk about the fact that ANWR is projected to be able to provide 20% of our oil needs for the next 30 years. Or the fact that China and Russia are currently allowed to drill closer to our coasts than U.S. companies - thanks to Cuba - and are doing so solely because we're not. Or the shale oil revolutions going on - through as much impedance as the Obama administration can provide - throughout much of the midwest?

    If you're not simply trying to smear Newt Gingrich and run interference on behalf of Obama or the other GOP candidates, why don't you actually listen to his message where he details all of the sources of oil we're not allowed to tap, as well as energy professionals who project that we could be energy independent within 10 years? At least learn the facts before you go trying to lie about them.

  • The Derider||

    Because no matter what, US energy production can only marginally affect the global price of oil. If we drill ANWR, the oil will get exported if the price is higher on the international market.

  • ||

    We live life in the margins. Oil price is high because of tight supply/demand balance. Newt's approach could double US production in 5-10 years, which would change supply/demand and cut OPEC off at the knees. This would cut the price and drastically cut our oil imports.

    As for Taoist's thorough and utter debunking of Bailey's Probama drivel - BRAVO!

    There is an oil and gas revolution in the making, and the main thing standing in our way is ... Obama and those like him who hate cheap enery.

  • ||

    Daily oil production in the U.S. is currently just under 6 million barrels per day. Iranian production is around 3.5 million barrels per day. If it's all about supply & demand, if we were to put a strategy in place that increased U.S. oil production by 50% in the shortest possible time, wouldn't that negate Iran's ability to impact oil prices based on their withholding supply (other than the threat to the Straights of Hormuz, of course)? Why is that not sound energy policy that could be enacted by any politician, Gingrich or Obama?

  • ||

    The answer is : YES. Had we opened up ANWR back when Obama was in the Senate and voting against opening up ANWR, we'd have another .5 to 1 million barrels helping improve our trade balance and keep oil prices lower.

    the price of oil is high because anti-energy politicians like Obama have made it so.

    "Newt Gingrich imagines he can command the law of supply and demand."

    Bailey's article is despicable because he imagines that politicians passing laws forbidding the use of 80 billion barrels of US oil have no impact on supply.

    How much of an overeducated nitwit do you have to be to pretend that our government hasnt drastically impacted oil supply via its taxes, regulation and prohibitions on drilling in so many places? (Including the entire offshore pacific)?

  • ||

    Newt Gingrich imagines he can command the law of supply and demand.

    Let's be fair. It's possible that he imagines that he could reduce the taxes on gas once in office. *reads article, yeah, nevermind*

    Why doesn’t Gingrich promise free daily ice cream and cake for everybody while he’s at it?

    Because of the predator drone that the current 1st lady would shove up his ass?

  • wareagle||

    no, he can't effect demand but supply is another matter. The Obama folks crow about the increase in drilling, ignoring that it is from permits 1) on private property that 2) were issued prior to their taking office.

    I am losing sympathy for a country that has an obscene amount of resources under its feet but is governed by nitwits who steadfastly refuse to use them.

  • The Derider||

    US energy production cannot influence the global price of oil in any significant way, and gas prices are determined mostly by the international price of oil.

  • ||

    Well hell then lets just sit back and do nothing. Every time supply has increased prices have gone down world wide simple fact. Now if your worried about our oil being shipped out of this country then why don't we tax only the oil that leaves this country. Make the rest of the world pay for our debts just like we've paid OPEC for all their debt by buying their oil, we can do the same. Simple solution to a not so complicated problem.

  • hk||

    Um no protectionism sucks.

  • shrike||

    Great article, Bailey. I sincerely hope you scored some tail while in Florida last week. You deserve it.

    Newt is completely full of shit once again. Why are we subjected to liars like this?

    And for the OWS idiots who yell SPECULATION! - gas is selling for less than $3 a gallon for November 2012 delivery now.

    Buy it!

    Speculation is not easy.

  • Jeffersonian||

  • shrike||

    Yes, political bi-whoring is for real. Both sides do it.

    I am looking at Alex Wagner and I want to stuff a red-hot boner somewhere into her smoking self.

  • fish||

    Alex Wagner?

    Who's he?

  • Newt||

    "gas is selling for less than $3 a gallon for November 2012 delivery now."

    Hmmm.
    Wonder if this has something to do with the market betting on gov't manipulation of prices just in time for an election.
    Naah.

  • Oil Tycoon||

    According to basically every idiot, speculators are causing prices to rise. Well if its so easy why don't these idiots buy some WTI and profit handsomely? They could use their new found wealth to fund OWS or teacher pensions or whatever BS they care about.

  • me not you||

    Do I get to pick the kind of cake and ice cream I receive? Also is that a single slice or a whole cake? If I pick do I get to eat it too?

  • Newt||

    me not you|3.13.12 @ 6:30PM|#
    "Do I get to pick the kind of cake and ice cream I receive?"
    No, the FDoICCD has decreed fruit cake and Neapolitan ice cream.

    "Also is that a single slice or a whole cake?"
    Hey, if you can swallow it, have all you want!

    "If I pick do I get to eat it too?"
    See above.
    Best regards.

  • jasno||

    Well, duh - Moon gas!

  • ||

    AKA "bare ass fart"

  • yogi||

    Delivered from his moon colony to Earth through a long hose I presume. But how does he plan to keep the bucket under the hose as the Earth rotates?

  • ||

    Didn't Michelle Bachmann make a similay promise just before her campaign went downhill.

  • ||

    Yes. It's sad when Newt's channeling Bachmann.

  • e||

    We need to cut public transportation, it's what's driving up the cost of gas. Buses and trains are extremely wasteful in the amount of gas that they use, especially trains. Compare a diesel locomotive or a bus to even a big car like an SUV - a locomotive uses far more.

  • ||

    Locomotives are best used shipping freight, not people. Buses are a huge fucking waste of labor, fuel, and materials.

  • Jerryskids||

    Newt Gingrich imagines he can command the law of supply and demand.

    That's only true if you believe that Newt believes what he says. If he believes what he says, he's bat-shit insane. I believe he's just flat-out desperately making shit up.

  • Realist||

    "Newt Gingrich imagines he can command the law of supply and demand."
    That's almost as dumb as thinking you can control climate!

  • ||

    ... and about as 1% as dumb as thinking you can create American jobs by spending money borrowed from teh Chinese on Government graft corruption and boondoggles!

    Viva la stimulus!

  • ||

    While the premise of the article is indeed correct, you can't simultaneously say that a million barrels of American oil will have absolutely no effect on global supply, and then pin the price of oil and the entire global supply entirely on the 3 million barrels of Iranian oil that *might* be at risk *if* there was any indication of a war in Iran, in the very next sentence.

    (continued...)

  • ||

    But even if we indulge that line of reasoning:

    Since Iran is ostensibly not an existential security risk to the USA and we consequently should not be concerning ourselves with their nuclear ambitions, let us assume that America was entirely out of the picture and that Saudi Arabia and Israel were allowed to take action unilaterally based upon their own interests? The risk is still there - in fact, it's magnified. Right now America is the only moderating force preventing a strike on Iran tomorrow. So blaming the saber-rattling of an as-yet-unelected presidential candidate whose poll numbers are tenuous at best for putting 3 million barrels of global oil supply at risk and single-handedly influencing the cost of oil, and consequently gasoline, is at least as retarded, if not more so, than suggesting that one's policies as president will reduce the price of gasoline by a buck a gallon.

  • ||

    In other words, don't ruin your credibility by making claims as outrageous as the ones you're denouncing - even though you're right.

  • There's||

  • a 900||

  • character limit||

  • for a reason||

    tl;dr

  • ||

    While the premise of the article is indeed correct, you can't simultaneously say that a million barrels of American oil will have absolutely no effect on global supply, and then pin the price of oil and the entire global supply entirely on the 3 million barrels of Iranian oil that *might* be at risk *if* there was any indication of a war in Iran, in the very next sentence.

    It's not just Iran's exports, but the possibility of rocket attacks on Saudi Arabia and the closing of the Straits of Hormuz. That's a quarter to a third of the world's oil production.

  • Talkin' My Book||

    "After all, who does not hate high gas prices?"

    More dividends and cap gains. Light Sweet Crude - I like 'em big time.

  • Darwin||

    I'm a little confused about Bailey's point here. Getting the exact numbers is hard, of course, but Newt is suggesting several policies that he could enact if President and would lower the cost of gasoline, right?

    1. Opening up federal lands for more drilling would increase supply and lower prices. Same for the pipeline.
    2. These imminent falling prices would cause speculators to stop buying up supply and sell it on the current market, lowering prices.
    3. Removing governmental barriers to natural gas would generate more supply of energy and lower prices...

    One can argue that these wouldn't bring it all the way down to $2.5, but an article saying Newt has a plan for three things to lower prices that would work but he's still despicable because they might not work that well is something I would expect on the Huffington Post, but not here.

  • Sevo||

    "1. Opening up federal lands for more drilling would increase supply and lower prices."
    Yes, that would increase world production.

    "Same for the pipeline."
    No. That oil is a given regardless of where it goes for refining.

  • ||

    The Keystone pipeline is vital for lower gas prices, because wellhead prices are low in north contintental US. Cushing oil is $20 cheaper per barrel than Brent crude, but Louisiana refineries pay brent price. I bet you didnt know that.
    Pipeline would directly lower prices at the pump.

    That Obama would oppose the much-needed keystone pipeline then turn around and open up the SPOR at a time when we not in a crisis situation wrt oil is..... oh, despicable, that's a good word for it.

  • ||

    It's despicable because he should be saying that cheap gasoline is not an American birthright. Put those proposals out there, and leave it at that.

  • wareagle||

    Bailey is ignoring, either purposely or through oversight, that when Bush simply announced a lifting of the moratorium on drilling, prices took a big tumble. So, it's not beyond the realm of possibility that action to increase domestic production can impact prices.

  • ||

    The left who WANT higher oil prices are deliberate in their ignorance.

    We have 80 billion barrels offshore and in place like ANWR that are currently offlimits. We have 1 TRILLION barrels worth of oil in the oil shale reserves in Green River area inthe Rockies. Shell Oil has technology that can extract that oil at $30-40/bbl. Obama admin has SHUT DOWN oil shale exploration, stops drilling in ANWR and elsewhere, and now proposes regs that will cut production of oil and gas.

    The same technologies that have created a renaissance in gas production can be applied to oil - if we let it happen.

    If Newt was in charge, yes, we would have $2.50 oil down the road, because we wouldnt have govt block the way due to mis-guided do-nothing flat-earther anti-fracking luddite drill-nowhere ideology.

  • Maxxx||

    One can argue that these wouldn't bring it all the way down to $2.5, but an article saying Newt has a plan for three things to lower prices that would work but he's still despicable because they might not work that well is something I would expect on the Huffington Post, but not here.

    This article is a sign of cosmo libtard hatred for all things Gingrich.

    Even, especially, when he is proposing freer market options to lower the price of gas.

    As a point of comparison, how many article have the reason-douches done ridiculing Obama's Algae Solution to high gas prices?

  • ||

    Reason has a number of liberals masquerading as libertarians.

    Mr. Bailey is one of them.

  • Almanian||

    Ronald - do not dount The Newcular Titties! Do. Not. DOUBT.

  • ||

    It doesn't matter what Newt says anymore...it looks like he is gonna lose the two southern state primaries tonight.

  • Almanian||

    Ohhhhhhhhh.......good!

  • Woof||

    Forget gas, when are these candidates going to address the skyrocketing cocaine prices.

  • Texas Death Rail||

    Open the Strategic Llello Reserve!

  • Woof||

    Shay hello to my leetle friend.

  • ||

    I think politicians should have to wear uniforms.
    Perhaps that uniform could include long flowing robes and a tall pointy hat, all covered with stars and moons and suns. The more slick their bullshit, the more stars and moons and such they could have.

  • ||

    Apparently the author has never heard of inflation

  • ||

    Newt's got big plans!! He even said so.

  • ||

    A little more oil on the market and a different attitude in the White House would have a signifigant affect on the price. Maybe not down to 2.50 but certainly a nice jump in that direction. Gingrich is not so hot. But a little hyperbolae is forgivable.

  • ||

    The only other world leader who ever promised a specific price for gasoline is Hugo Chavez.

  • ||

    lol, same old song and dance, we have heard it ALL before and yet nothing EVER changes lol.

    www.World-Anon.tk

  • ||

    I strongly disagree with this essay. I think the writer is wrong and there is much the government can do to help. Instead we get Solyndra and all the rest.

    But one thing:

    "Why doesn’t Gingrich promise free daily ice cream and cake for everybody while he’s at it?"

    I very sure he's already done that. After all he is far and away the "transformational" figure in history for our time. Just ask him

  • GW||

    I think the writer is wrong and there is much the government can do to help

    Well I'm glad you backed that claim up with tons of solid evidence.

  • ||

    I'm tired of promises with no consequences; i want to hear "GAS will be X.XX by this date or i will resign. No Ifs ands or buts.

  • ||

    In 2008, in July, oil touched $147 a barrel. Gas, in the leftist paradise, San Francisco, California was $3.27.

    Today, oil is $106 a barrel....and gas...in the same place...is $4.29.

    Demand is down, supply is up....and gas is $4.29 a gallon.

    Does that make sense? The price seems artificial.

    I suspect the price could be brought down as easily as it was when Bush lifted the moratorium.

    So yes, Newt could get prices down. Of course, that means that Obama could just as easily. He just won't.

  • Gadianton||

    des·pi·ca·ble [des-pi-kuh-buhl, dih-spik-uh-]
    adjective
    deserving to be despised; contemptible:

    A politician making a promise he either won't have the power to keep or has no intention of keeping in order to get elected doesn't meet that bar.

  • ||

    STFU Lying Sack of Shit.

  • Josh S||

    The Fed should just print some more money so we'll all have enough to buy all the gasoline we need.

  • ||

    Written, by someone who doesn't have to worry about choosing between gas and food. Newt has a plan, it's better than, it won't work today so lets do nothing.

  • ||

    To my mind, Americans have an insatiable thirst for gasoline. Just look at the amount of traffic on roads and highways, and you'll see that a severe gas shortage would practically cripple the United States. Americans drive nearly 3 trillion miles per year, according to the Motor and Equipment Manufacturer's Association statistics. That's about 820 trips from the sun to Pluto and back….And I think the Obama’s formation of a task force to examine oil markets will hardly help here…

    http://cashadvancesus.com/

  • ||

    He may as well promise free health care! That would be a whopper!

  • ||

    Bailey you are full of shit. Anyone who observes the rise and fall of oil prices knows that oil is almost never in short supply. It is the perception of the speculators that drive the price variables of oil. If Newt were in the WH and he said to the world that the US would start a multi-pronged effort to exploit all forms of energy the perception around the world would drive the price down almost immediately. It has happened before on more modest scale just by announcing that the SPOR would be tapped. You may not like Newt and his ideas but at least be honest with your reader(s). It is nice to see someone running for the POTUS who actually enunciates ideas and policies that will/may have an effect on the many problems we have. As opposed to the "I am an extreme conservative" crap from Mitt and the "I'll wipe out internet porn" crap from Santorum. No need to mention the crazy uncle.

  • hk||

    Well you're crazy, global demand is UPUPUP and we put sanctions on potentially 25% of the world's oil supply.

    And Obama wants us to use even more expensive energy anyway, so he deserves the criticism.

  • ||

    Actually he can lower the price to 2.50 very easily. Completely open the gulf and artic to development....Executive order it and the price will drop .50 a gallon in a month....Get rid of the EPA....rebuild it from the ground up...Get rid of all the regulations that obummer has added.....and just watch

  • ||

    Great points, totally debunks Bailey screed.

    Another stupid Obama decision was to shut down Yucca mountain. Totally dumb election ploy to save Harry Reid, that screwed nuclear power industry.

    If we had a pro-energy President like Newt, the price of energy would definitely respond both in the short term and the long term.

  • hk||

    And how many more barrels of oil would we be producing per day?

    We don't control the world's oil supply get real.

    Newt is a fucking idiot when it comes to Economics too.

  • hk||

    i.e. he's a Socialist if you want to get into the details.

  • ||

    Obama's is gay he likes sweaty balls across his face.

  • ||

    A US president can affect the price of oil through energy policies. Drill what we have in the US, the kerogen shale in Wyoming and Colorado total 1-2 trillion barrels. Oil off the coast of Florida which the Chinese are srilling by "drinking our milkshake", NC, Ca, and Alaska. Fracking and ice barrier technology are enviro friendly. A policy to flood the market with US oil would most definately affect the price of oil as speculators would invest accordingly. We have more oil than the rest of the world combined, as well as natural gas. We will always need oil--the petrochemical polymers are used in nearly everything we make, like vinyls, meds, food, even the toothbrush you used this morning was made from them. Get a grip, every other country will drill their oil--they are not on a suicide mission to destroy their economy like Hussein is. Screech and cry all you want, but you are WRONG!

  • ||

    That's funny because I just heard Trump saying we could get it down to $2.00 really fast. If this was Bush, it would be all his fault. Please people, wake up before it's too late.

  • Yossi Gestetner||

    70 of Bushs 96 months in office (you know, when UR was 4-5 percent, which meant a strong economy) Gas was below 2.50; another 9M was below $3.00. Rest was bubble during recession; not demand. So Gas can indeed be now well below $3.00 even if the economy get really good.

  • hk||

    Oil is a global commodity. That means the world produces 90 million barrels a day, most of that is not on US soil.

    I'm not sure about your arguments.

  • ||

    Here is how we get to the equivalent of $ 2.50 a gallon of gas.

    Methanol can be made from natural gas or coal for way less than a dollar a gallon. Cars using methanol would need about twice the gallons to go the same distance, but even with taxes distrobution and profits the cost would be the same as $ 2.50 a gallon of gasoline. Then realize that the US owns huge amounts of coal and natural gas. Wow!

    In addition then factor in that to make metanol ready cars it only takes about $200 a car. Then burning methanol in cars is brillant.

  • ||

    Here is how we get to the equivalent of $ 2.50 a gallon of gas.

    Methanol can be made from natural gas or coal for way less than a dollar a gallon. Cars using methanol would need about twice the gallons to go the same distance, but even with taxes, distribution and profits the cost would be the same as $ 2.50 a gallon of gasoline. Then realize that the US owns huge amounts of coal and natural gas. Wow!

    In addition then factor in that to make methanol ready cars it only takes about $200 a car. Then burning methanol in cars is brilliant.

    Let's go for it!

  • hk||

    Building the infrastructure for this is probably not feasible, but in the long-run natural gas is something we should use, certainly.

    We're still not going to lower the price of oil with this stuff.

  • ||

    How come, the temporary loss of 2 million barrels a day of Libyan oil during the uprising raised oil and gasoline prices but Newt's proposal to permanently increase US production by 2.5 million barrels a day by making more areas open for drilling and allowing canadian oil to flow by pipeline to our southern refineries would not lower oil or gasoline prices in author's opinion. I suspect if Obama opens the strategic reserve it is because he believes that this would lower gasoline prices. How come oil from the reserve lowers prices but increased oil production does not? I think the answer is more found in political orientation than Science.

  • hk||

    I'm not sure that was just because of Libya. There was an oil futures crash which artificially lowered the price of gasoline.

    Although the President is partly responsible like the Article said.

  • ||

    It is good that the cost of a barrel of oil is mentioned. The same energy in a barrel of oil that costs $105 today is found in $ 13.11 worth of natural gas. Oil is such an old fashioned fuel. Time to wake up!

  • ||

    I disagree completely. Gas prices can be lowered with greater supply. Drill here, drill now, drill often. Problem solved. And that is what Mr. Newt is advocating.

  • ||

    "Why doesn’t Gingrich promise free daily ice cream and cake for everybody while he’s at it?"

    Leave something for October.

  • دردشه عراقية||

    Thanks

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