Who do we blame for falling oil/gas prices? (middle east, suspect, conspiracy)

[expgc]

A few short months ago the blame for oil/gas price escalation was due to a conspiracy and collaboration between Bush, Republicans, Evil oil company execs, equally evil oil futures speculators and any other greedy capitalist that could be found.

Now that prices have fallen dramatically who should we blame? Why is this happening? I'm worried because I have more money in my pocket.

[AaronK]

I blame you.

[saganista]

Well, let's see...US refining capacity remains essentially unchanged, so those who hung their hats on that ruse earlier in the year would now seem to be left holding them. As for the speculators, a little where were they then versus where are they now might be an interesting sort of exercise. Goldman Sachs, Morgan Stanley, JP Morgan Chase, all those free-wheeling hedge funds. What has changed for those folks over the past six months or so? It may be that the players whom the SEC and CFTC didn't oversee in the Spring simply aren't there anymore to be overseen in the Fall. That and the rest of the fallout precipitating from the credit crisis go a long way toward explaining $147/barrel to $65/barrel in fourteen weeks...

[kentuckydad95]

Economy falling apart=falling gas prices.

This is such a "no-duh" question to answer.

[Apolitical]

Oil prices spurted to almost $150 bbl last year because of the combination of physical demand and a huge increase in investment interest.

Speculation on oil futures contracts occurred because they believed that their investment would rise in value. That perception was based upon data from the oil companies that reflected ever tightening inventories. However there is now an ongoing investigation by the US Commodities Futures Trading Commission that inventory may have been falsified.

Can you imagine that....a corporation that would falsify data that would result in increased profitability? Inventory data was the spark that lit the fire under oil prices. The oil industry always purported that they could not affect oil prices, but their inventory data could.

Regulators probing oil supply data: report | U.S. | Reuters

Now we are seeing a reversal of this run-up and the action to the downside is caused by speculation also only it is from selling. Investors are selling their futures contracts on oil for two reasons. 1/ they believe there will be less physical demand in the future and 2/ they need liquidity, to cover margin calls on other investments.

[MiamiRob]

Americans also cut their driving by 15 billion miles so far this year alone. The lower demand makes a big difference. OPEC has now vowed to cut Oil production by 1.5 million barrels a day to keep the price from falling below $60 a barrel so basically the issue was never about the amount of Oil available.

[saganista]

It is a good thing overall, but US demand for oil has been falling for some time. The effect of that on global demand has however been offset by increases primarily out of India/China and the developing Middle East. Even though the US continues to be a large player, it is not necessarily dominant. Declines in US demand were not a significant factor either in the short-term run-up in oil prices or in their subsequent rapid decline.

OPEC is cutting production because they suspect that there is no one to buy it. They have no interest in pumping stuff out of the ground only to have it just sit there.

[burdell]

Place the blame squarely on two perpetrators: Supply & Demand

[kentuckydad95]

Plus it's election time. Fuel prices go down during that period.