Posted by
Andrews on Friday, August 15, 2008 3:23:54 PM
I think I have figured out why many will not accept the truth about rising oil prices, it doesn't give them a villain with whom they can be angry. It doesn't even give them a nonhuman antagonist against which we can "struggle". And we always seem to want someone or something to "blame". We may sometimes accept that it is simply nature against which we struggle, and we declare "war" on cancer or AIDS, but we can't stand it when a "problem" has no easy villain.
And that is the problem with the rising oil prices. It looks like a "crisis", people are upset, but the explanation is that demand rose quickly while supply has been largely stagnant. Worse yet, while we can blame to some degree the laws in the US that prevent new drilling, for the most part the lack of supply has no one to blame. Oil fields in Iraq still need repairs, Mexico's fields are aging and corruption is taking its toll, Venezuela is suffering the usual post-socialism decline, but for the most part, the fact is that oil is in short supply because it takes time to get new wells producing, so we will not see increased supply for a while.
But, with such a boring explanation, without a clear villain, people naturally feel a bit disappointed. They just can't accept that oil prices just are high, and may go higher, and that the only cure is time. That doesn't sound right, it gives them no one and nothing against which to rail, so they invent "speculators" and "Big Oil" conspiracies, whatever they can make up to explain the rise in oil.
It doesn't make sense, but without a villain, people simply will not accept the truth.
POSTSCRIPT
Here, for your convenience, is a partial list of my most recent posts on energy:
G-d Save Us From Simple Solutions
Absurdities on Oil
Those Darn Speculators
Economic Illiteracy
Obama's (Lack of an) Energy Policy
One Specific Idiocy
A Thought on Solar Energy
Oil Logic
Solving High Food Prices
Several Convenient Untruths
It's Not An Energy Policy
A Question for Those Supporting Green Energy
There are many older posts, but I think this hits all the highlights.
POSTSCRIPT II
And, to address those who will mention "speculators", yes, as prices are likely to rise more before they fall, speculators are buying oil. And when it looks like oil will fall, speculators will sell, lowering prices. That is what speculators do, flatten out spikes in prices. But while they get blamed for price increases, they never seem to get credit for lowering prices as the peak nears. But, if you think logically, how else dot hey make money? Just buying and holding oil will not make anyone rich. Only by buying then selling do you make money, and the efforts of speculators, while increasing prices in troughs, also lower prices during spikes. That is hardly a sinister purpose.
Unfortunately, as prices are rising, speculators make an easy scapegoat for those seeking a human villain to blame. But I would point out that, though speculators do cause prices to rise somewhat, do not in themselves start movement. Speculators follow trends, they do not create them. At least successful speculators do. Those who try to start their own trends tend not to be speculators for long, just ask the Hunt Brothers.