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Dollar Drops Further -- Oil Prices Soaring
Sounds more like 'equalization' than anything else.
A gallon of gas for $4.05 ????
Where do I line up? I filled up the car last night on my way to dinner with the little lady, I paid (including US / CDN exchange) $5.25 a gallon for premium, the regular was selling for $4.80 a gallon.
My family in Ireland says gas prices currently are nearly $8.00 a gallon and I have friends who just got back from the south of Europe (France, Portugal & Spain) they said gas was above $8.00 a gallon everywhere they went, and in one spot it was above $9.00 a gallon.
Despite the fact that I'm a raging capitalist, I think we've been a little too spoiled for too long when it comes to things like gasoline, water and food.
The US uses, on average, 1,635.2 liters of gasoline per person, per year. In contrast to other countries, that is something like 6 times the European average consumption, and more than double that of all other "high income developed countries. It's even 36% higher than it is up here in Canada.
Sounds like it's belt-tightening time.
Best of luck.
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Dollar Drops Further -- Oil Prices Soaring
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The sudden increase in oil prices -- from about 45 dollars per barrel during Clinton's terms in office, to now over 135 dollars per barrel, just 10 years later -- is mostly due to the SHARP drop in the value of the U.S. Dollar. Oil, throughout the world, is sold in U.S. Dollars.The Dollar is the basis for the price of oil, world-over.However, the Euro recently took off.The Dollar is now weaker than the Euro by a WIDE margin....and it continues to fall.Due to the higher value of the Euro, oil producing nations are demanding more U.S. Dollars in order to make up the difference.
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Joel, with all due respect, you're a little off the mark here.
First off, if you look at the price of oil & the US $ / Euro exchange rate over the last few years it looks like this;
2001 - US$/Eur. = 1.11691 (100%)
2002 - US$/Eur. = 1.06106 (94.99%)
2003 - US$/Eur. = 0.88540 (79.27%)
2004 - US$/Eur. = 0.80510 (72.08%)
2005 - US$/Eur. = 0.80443 (72.02%)
2006 - US$/Eur. = 0.79714 (71.37%)
2007 - US$/Eur. = 0.73096 (65.44%)
2008 - US$/Eur. = 0.65533 (58.67%)
The US$ is worth 58.67% of what it was worth against the Euro in 2001. so it has lost 41.33% of it's relative value.
The price of oil over the same period (in US$ as annual averages for West Texas Inter. crude) has been;
2001 - $25.98
2002 - $26.18
2003 - $31.08
2004 - $41.51
2005 - $56.64
2006 - $66.05
2007 - $72.34
2008 - $132.30 (as of today)
So, as of today, the price of oil is up some 509% over the 2001 average, while the dollar has only lost 41.33% of it's relative value against the Euro., or less than 1/12th of the increase in the price of oil.
Further, I think you're confused about one small point, oil is QUOTED in US$, but there is no correlation between the value of one and the other. It is merely a common denominator, sort of like speaking English as a common business language. The price of oil is determined by an auction if you will on the world market, the price people are willing to pay, now (spot) and in the future (futures) determine the sale price.
Currently many factors, not the least of which is the sub-prime mortgage problems, and associated massive, losses are pushing institutional investors to buy heavily in the oil sector.
BTW, it's not just oil that's up either, the price of gold has gone from ~US$275/oz in 2001 to over US$1000/oz this spring, although it's eased back to ~US$875/oz now. That's well over a 300% increase also.
Best of luck.
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Dollar Drops Further -- Oil Prices Soaring
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During these past 8 years, world-wide oil consumption has increased by a substantial margin.This fact, alone, would account for about half of the increase in price of a barrel of oil.The other (roughly) half of the increase can be accounted for with the drop in value of our purchasing power......a worthless U.S. Dollar.
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That's not correct either.
Global oil consumption has been almost perfectly steady at about 4.1 barrels per person, per year (give or take 0.25 barrels per year) since 1971. The population has been rising though, and that means total consumption did too, at a rate of about 1.275% a year in an exponential manner.
You also cannot take a single currency like the Euro and say this is what happened. For example, since 2001 the US$ has only lost about 3% when compared to the Japanese Yen, and about 28% compared to the British Pound.
Can you explain your math please, how could a 40% drop in the value of the dollar account for half of a 500% increase in the price of oil? 40% = 250%? I don't think so.
Finally, again, I say, the price is QUOTED in US $, it is NOT FIXED to the US $. There is a world of difference.
If a Russian speaks English it doesn't mean he stops being Russian.
Best of luck.
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Dollar Drops Further -- Oil Prices Soaring
Chief, I like 'speckled hoolapoppers', I have really good luck catching bucket mouth bass on them, especially around dusk, makes them crazy. Don't know if it's the skirt or the popping sound but they sure like them. 
Mark, I liked it better before the edit. 
Best of luck.
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Dollar Drops Further -- Oil Prices Soaring
Hey, I'm the last guy to get between someone and a good rant, as they used to say "carry on men!".
I completely sympathize with what you're saying too!
Many years back when I was burning my share of Uncle Sam's money for him, we had a really funny episode, speaking of the speckled hoolapoppers.
One of the things we used to practice (nearly incessantly) was hitting the beach fast and low to exploit the near invisibility of all things near the surface of the water because of the heat rising off the oceans surface. Mostly this was done over a 'practice area' consisting of several deserted islands and cays in the Bahamas, part of the old WWII-era coastal defense system.
That was until a bunch of dolphin huggers caused a fuss about us disrupting the Bottlenose Dolphins in the area.
After much fuss, and study, and likely no small sum of money, a very learned professor declared, not only were we NOT bothering the dolphins, but in fact we were HELPING them!! That's why they were congregating there in the first place! It turns out, the sonic booms and loud noises were not bothering them in the least, but it was screwing up the small fish in the shallows on which they fed, making them easier prey for the dolphins!
The funny part?
A pair of high-ranking elected US Gobbermint officials (wink) arrived to speak to the local goobermint along with the US Ambassador to assure them we weren't destroying their country after all. After the meetings they went fishing, while drinking some local rum, and were charged with several things including fishing out of season and taking more than their limit even if it had been in season. The charges were later dropped as a 'technical oversight'.......
Best of luck.
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06-11-2008, 14:26 
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