Below are two charts that blast a gaping hole in the Energy Independence Storyline being peddled to the willfully ignorant masses by the MSM and government drones. Please notice that gasoline usage in 2013 is at the same level as 2002. This is not due to more efficient cars. Over 70% of all vehicles sold over the last 10 years are pickups, SUVs, Minivans, and large luxury vehicles that get 20 mpg or less. That storyline is complete and utter bullshit. We are using less gasoline because our economy continues to be in a recession. We are using 10% less gasoline than we were at the housing bubble peak.
When I took Econ 101 the law of supply and demand was pretty clear. If demand is down and supply is up, the price will go down. Pretty simple. Even an idiot like Paul Krugman or Barack Obama would agree.
But let’s look what happened in the real world. Remember the good old days of 2002 before George W. launched his War on Terror? Oil was selling for $25 per barrel and you were paying $1.35 for a gallon of gas. Recall from the above chart that gasoline usage was exactly the same as today. The neo-cons and now the Obamanistas claim our war on Middle East terror has been a huge success. Iraq is a Democracy. Right? We’ve liberated Libya. Right? We’re going to declare victory in Afghanistan and leave next year. Right? OPEC is supposedly pumping record amounts of oil.
And everyone knows the Bakken oil shale is the new Saudi Arabia. The US is now producing more oil than it has in years. The pundits tell me we’ll be exporting oil in the near future, even though we import over 8 million barrels per day. Obama says we have 100 years of oil under our feet. Glory be to God. With all this supply and demand at 2002 levels, I can’t wait to pull up to the pump tonight and pay $1.50 per gallon.
But wait. If I pull up to the pump tonight I’ll be paying $3.60 per gallon??? WTF.
Is it those dreaded speculators?
Is it the dreaded oil companies that don’t control the oil?
Bernanke tells me inflation is well contained, so I’m sure his money printing has nothing to do with it. My friends at the BLS tell me that inflation is ONLY up 29% since 2002. That would account for a price of $1.75 today.
I’m baffled. Of course, if inflation has really been three times higher than what the drones at the BLS have reported, the price would be $2.50 per gallon. And if the storyline about abundant supply was adjusted to the truth that we reached peak worldwide oil production in 2006, that would account for the additional $1.10 in price. But that couldn’t be true because the people on TEE VEE tell me differently.
I sure am glad I have experts, TV talking heads and government drones to keep me informed about why I’m paying $3.60 per gallon of gas when usage is at 2002 levels when prices were $1.35 per gallon.