Oil prices plunge for second straight day
HOUSTON — Oil prices headed in an unusual direction — down — for the second consecutive day on Tuesday, leaving energy experts to wonder whether the drop is the beginning of a lasting trend or just a brief pause before another surge.
Oil settled at $136.04 a barrel, a drop of $5.33, or 3.8 percent. Analysts said the immediate causes included the strengthening of the dollar in recent days and the apparent veering northward of Bertha, the first hurricane of the 2008 hurricane season, meaning it was likely to miss the oil and natural gas facilities in the Gulf of Mexico.
We live in a global economy where the price of commodities like oil is controlled in the world market by thousands of traders who are "betting" on the future price. In a scenario like this, more/less production of oil is almost irrelevant. So John McCain's plan to drill for more oil ultimately won't matter in terms of the price of oil because no matter what the vast majority of the oil on the world market will be foreign, and subject to world-wide market events.
The solution to our energy needs is to create other markets in different fuels that we control here at home. Americans need to have the pricing power, and the ability to increase and decrease supply in a meaningful way.