FairMind: Yes indeed, the demand for gas will constantly increase and, like you said, the supply of oil will peak, which is what I mention in the Peak Oil happening. In the long run it'll be indeed an increase of demand and a decrease of supply that will drive prices up. However the economics community at this point has concluded that 70% of the price of oil is due to speculation and it won't change anytime soon since speculators are indeed driving prices up and up for their own benefits and it's a situation that will indeed keep on going for a long, long time, pressuring demand all the way. In the long run we do hope the speculators will give gas a break but if there wasn't any speculation on the gas prices then the prices would have been up due to the demand and supply, as you correctly mentioned, but not at the levels that they are today.
Take care.
Alguém
JoinedPosts by Alguém
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Now Witnesses saying "Gas Prices" show we are in the Tribulation!!
by Witness 007 inyes it's not offical but witnesses here are saying that gas prices and increased cost of living show that armagedon is sooooo close.....haven't they heard of world war 1 and 2 when people didn't have sugar, gas, coffee or anything?
armagedon didn't come....we bounced back.
china in the 1920's and ukraine during the war people "hunted" children to eat!
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Alguém
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24
Now Witnesses saying "Gas Prices" show we are in the Tribulation!!
by Witness 007 inyes it's not offical but witnesses here are saying that gas prices and increased cost of living show that armagedon is sooooo close.....haven't they heard of world war 1 and 2 when people didn't have sugar, gas, coffee or anything?
armagedon didn't come....we bounced back.
china in the 1920's and ukraine during the war people "hunted" children to eat!
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Alguém
Actually, being an economist, the reason of the inflated gas prices is simple.
Human greed.
Allow me to explain. The supply of Gas remains but the aggregate demand has increased. That is due to the emergent economies like China and India seeking out more and more gas. However that is not the main reason of gas prices being high.
Speculation is. Investors are buying what Americans call Futures. Those futures consist, amongst other things, of oil. Futures allow investors to buy commodities. Now they are buying lots of oil, pressuring demand and making oil a scarcer commodity. Being scarce and with demand rocketing above supply the Law of Supply and Demand gets into effect and oil prices increase in order to meet a balance point between demand and supply. The problem here is that the investors keep buying the futures because they know that if they keep buying the prices will keep increasing and they can sell them at a higher profit margin.
Basically human greed. At its worst. Armageddon? Nope, not really, just plain human nature showing its face again.
However here's something funny. Economists do have an Armageddon event, so to speak. It is called Peak Oil. I urge everyone to research it. Some in our community of scholars believe we are heading towards a Peak Oil situation. I hope not but my experience and rationality warns me that we may indeed be heading towards it if the speculators aren't stopped soon.
Anyway if a JW comes and says, "Gas prices mean Armageddon, come with us if you want to live." tell them the above about supply, demand and futures. Nothing like a calm, rational explanation in the face of blind fear and hysteria to break the spell, even if for a brief moment.