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Originally Posted by rickholio
This is a bad analogy. Going to work isn't a consequence of starting the car. You can get to work by walking, biking, bussing, hitching a ride. The goal there is getting to work, not the means to the end (starting and driving the car). ...
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You're absolutely splitting hairs here. Enough said there, I think.
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Control over oil does more than affect prices. Control over oil gives you power over other nations. Currently, oil is treated as a commodity and is more or less equally available everywhere at a uniform cost... but in the future, when scarcity becomes an issue the game will change dramatically. The ultimate goal is power, and control over a nation's energy largely equates to control over that nation's sovereignty.
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I respect your opinion regarding control as a means of expanding hegemony, but there are more direct ways to to that as well.
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If the price of oil was the ultimate goal, there are myriad ways to affect price that are cheaper and more reliable (stockpiling, for example). I'm sure some sectors of the economy would love more expensive oil, just as others would love cheaper oil, but those factors likely matter little in the overall scheme of power and future supply security.
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I disagree. Stockpiling, while a good supply/demand solution to controlling price as long as other variables are stable, is much more difficult as primarily China, but other nations as well, continue to industrialize. This phenomenon has been occurring very rapidly over the past few years. In order to efficiently stockpile oil, price has to be low enough in a world where demand is increasing at an accelerating rate. As for 'sectors of the economy' &c., I think you're being a little specious. Overall, ower prices are far more conducive to realizing stable political and economic environments in the United States and other important nations who practice a semblance republican government. Therefore, in the emerging global economy, using stockpiling as a means of controlling oil prices is a less attractive option than first controlling price in order to stockpile.
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A factor that hasn't been mentioned which is germaine to the price of oil is the fact that most oil traded is priced in USD, and while the price of oil may be going up heavily against the USD, it's much more gentle against other world currencies... there's an average increase of 25% of other currencies vs the USD over the last 2 years (EUR, JPY, CAD etc) and around a 50% in the price of light crude/barrel. The 'increase' in oil prices seen is as much a reflection of the pisspoor performance of the greenback as a genuine slide up the supply/demand curve.
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Exactly. And has been mentioned on this board, Iran for one is looking at pricing in Euros. Therefore, controlling the oil is a means of controlling price when viewed through the paradigm of contemplating military action against Iran (a thread was posted on GFY about this, which is what prompted me to start this thread).
As I said, I think that overall you and I are simply arguing semantics in this thread. I might also add that the point of my initially posting this thread was simply to get a read on how realistic certain people on this board are when it comes to oil and its importance to the overall economic picture, and therefore how important price is. You've added an interesting dimension, but it's not really within the scope of the original post.
