Today along with the slump in the economy, Americans are also faced with the rise of gasoline prices. A gallon of gas today costs $4.09, whereas twenty years ago a gallon cost $1.13.
Many Americans think that this intense rise in gas prices is a way for the government to be in control and govern the types of vehicles people drive. The rise in price is that the government continues to purchase oil from other countries that are not stable, Wall Street Speculators continue to buy future contracts to protect themselves, and the government will not release any oil held in US Reserves is the reason for high gas prices. The Government has little or no control over the price of gasoline. The people themselves are causing the high prices because of supply and demand. The United States buys oil from other countries such as Saudi Arabia and Iran. President Obama has put sanctions on Iran that has made Saudi Arabia and other countries produce more oil. Many believe that Saudi Arabia will not be able to supply the amount of oil needed to cover Iranian gaps. “Instead of reflecting on this pending crisis, many are hoping inventories prove to be more plentiful than believed, or that producers will magically get their acts together in time to fill the gaps” (Hulbert, 2012). President Obama stated over Iran “that there is sufficient supply of petroleum and petroleum products from other countries” that the United States will remain tough (Hulbert, 2012. This has caused shortages, which is one reason why gas prices are high. Investors are getting rich from the oil market. Wall Street Speculators artificially manipulate the market by buying up oil creating the perception of a shortage, which drives the prices up and then selling the oil for profit for themselves (Persaud, 2012). Years ago in oil trading the speculators made up about 30%, and the producers were about 70% in the commodity markets, today it is reversed. Speculators force the supply and demand to go up, which causes the prices to go up. There are many opinions regarding if the government should release oil from the U.S. Strategic Petroleum Reserve (SPR). Releasing the oil would not fix the problem permanently. Before the United States could release the oil,