Oil Is Laughing At Obama

Last week, when Obama announced his offshore drilling plan, the price of a barrel of oil was just below $82. Today, oil is at about $85.50 a barrel and looking to go higher; probably much higher. If the oil traders thought that what Obama had proposed in his offshore drilling plan would actually increase oil production and wean America off foreign oil, the price would have traded downward; or, at least sideways. But, the traders know that Obama's plan is nothing but political fluff with no real substance.

Obama and his Eco buddies don't really care if oil ends up being in extremely short supply and that the price per gallon of gasoline goes above $4 again. Even though that would hit us hard in our wallets and might even cripple our economy, high oil prices give them the opportunity to push those "green" alternatives that would hardly be cost effective alternatives to oil unless, of course, you limit oil production and, as a result, artificially force the price of oil to rise rapidly.

Last year, at the height of the recession and when oil usage was actually falling, I, as a contrarian, said oil would rise to $80; and, it did. I also predicted that oil would go to $120 a barrel this year and I still believe it will. My guess is that we will easily see $100 a barrel and $3/gallon for gasoline by the summer driving season. I would expect that by year's end, $3.50 a gallon will become the new normal for gasoline prices in this country. As a result, you can expect the prices for everything to rise because oil is essential to the production and delivery of almost every product we consume. Therefore, you can add high oil prices to all the other things that this President has done to make it more expensive to live in America.