The Price Of Oil - NYT Mystified By Cause & Effect

The price of oil is swinging violently and trending ever upwards. The NYT is at a loss to explain it:

The extreme volatility that has gripped oil markets for the last 18 months has shown no signs of slowing down, with oil prices more than doubling since the beginning of the year despite an exceptionally weak economy.

The instability of oil and gas prices is puzzling government officials and policy analysts, who fear it could jeopardize a global recovery. . . .

A wild run on the oil markets has occurred in the last 12 months. Last summer, prices surged to a record high above $145 a barrel, driving up gasoline prices to well over $4 a gallon. As the global economy faltered, oil tumbled to $33 a barrel in December. But oil has risen 55 percent since the beginning of the year, to $70 a barrel . . .

Read the entire article. The NYT goes on to quote speculation that the instability in Nigeria and Iran are playing a significant role in the rise in oil prices, but both of those are of recent vintage and do not account for the steady upward rise in oil prices since the beginning of the year.

Anyone who couldn't see this coming is not paying attention. I wrote a month ago, in the post "The Looming Crisis In Energy Costs," that we would soon face another energy crisis. None of the causes in demand that gave rise to $145 a barrel oil have disappeared permanently. Obama has refused to live up to his promise to allow expanded exploitation and exploration of our domestic oil resources - perhaps the only thing in the near and mid-term that could actually stabilize world oil prices. And on top of that, he has, with the cap and trade bill, declared war on our energy industry, particularly on coal which provides almost 50% of our energy. This is bound to increase demand for oil. Lastly, oil is priced in dollars. A weak dollar causes higher prices for oil - and Obama is in the process of destroying the value of the dollar.

As I wrote in the above referenced post, all of these factors are clear indicators that we can expect a real crisis in oil costs. There is no reason for the NYT to be mystified by the rise in prices over the past six months. Cause and effect are clear. The NYT just needs to start some honest reporting.

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McCain Passes Economics 101 With High Marks

Some time ago, McCain admitted that his weakness was economics. At the start of the semester / campaign season, he was pushing an economy busting cap and trade plan and refusing to allow drilling even in the face of our energy crisis. Today, cap and trade is dead, taxes are to be lowered, the dollar to be made stronger, and McCain has a sensible energy plan. Even Larry Kudlow's giving him a gold star. The Danes don't even think we need an election, from their viewpoint. I fully concur with their logic.
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On Monday at a town hall in Denver, John McCain laid out his "Jobs for America" plan that you can find here. You can also find an online briefing detailing the plan here. Then there is this from Larry Kudlow writing at NRO:

After writing favorably about Sen. McCain’s recent economics speeches, where he clearly shifted toward the supply-side both on tax cuts and producing more energy, I went back last evening and carefully read his 15-page policy pamphlet called “Jobs for America.” Here’s what I found:

There is no mention of cap-and-trade. None. Nada. There is a section about “Cheap, Clean, Secure Energy for America: The Lexington Project.” But that talks about expanded domestic production of oil and gas, as well as the need for more nuclear power and coal along with alternative sources. Then it has the $300 million battery and flex-fuel cars. But nope, no cap-and-trade. So I picked up the phone and dialed a senior McCain official to make sure these old eyes hadn’t missed it. Sure enough, on deep background, this senior McCain advisor told me I was correct: no cap-and-trade. In other words, this central-planning, regulatory, tax-and-spend disaster, which did not appear in Mac’s two recent speeches, has been eradicated entirely — even from the detailed policy document that hardly anybody will ever read. So then I asked this senior official if the campaign has taken cap-and-trade out behind the barn and shot it dead once and for all — buried it in history’s dustbin of bad ideas. The answer came back that they are interested in jobs right now — jobs for new energy production and jobs from lower taxes. At that point I became satisfied. . . .

. . . I might add that in this lengthy policy document there’s a strong statement about appreciating the value of the dollar. “John McCain’s policies will increase the value of the dollar and thus reduce the price of oil.”This is good. It’s not perfect. Neither is McCain’s tax plan and new energy plan. But it is excellent progress.

Read the entire post. (H/T Classical Values.) Now it would seem time for Econ 102.

This is all quite good news. Though even without these big strides, the worst McCain could do is far less than the far left who seem prepared to sing the requiem for capitalism and enact socialism in one fell swoop, shades of Britain in 1946.

Not surprisingly, there is a tremendous amount of interest in the U.S. general election overseas, though there is also some confusion as shown in this e-mail from some individuals in Denmark:

We in Denmark cannot figure out why you are even bothering to hold an election.

On one side, you have a bitch who is a lawyer, married to a lawyer, and a lawyer who is married to a bitch who is a lawyer.

On the other side, you have a true war hero married to a woman with a huge chest who owns a beer distributorship.

Is there a contest here?.

This joke cribbed, with great appreciation, from fellow Watcher's Council member The Colossus of Rhodey, with a hat tip to Soccer Dad.

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Interesting New From Around The Web

The NYT tells us today, in its lead article, that most of the foreign fighters in Iraq have been coming from Saudi Arabia and that these foreign fighter constitute 90% of the suicide bombers. I am not sure how any of that is news – we’ve known it for years. And than the NYT tells us that the bulk of the Sunni insurgents were Iraqi. Well, yes, we’ve known that too, just as we also know that, for a lot of the Sunni “insurgents,” their motive has been bin Franklin, not bin Laden, and that most of the bin Franklins have been flowing out of Saudi Arabia. How these facts justify a lead article has me a bit stumped. Am I missing something?

One of the world’s youngest democracies, Mongolia, has a new PM, Sanj Bayar.

In some really good news, that treacherous former French President, Jackques Chirac was placed under formal investigation Wednesday for allegedly embezzling public funds while he was mayor of Paris.

Iran is acting to push up the price of oil. Bomb them. Bomb them now.

“The situation in Iraq has improved so rapidly that Democrats now shun the topic as thoroughly as they shun our troops when the cameras aren't around.” Ralph Peters tells us the 5 reasons Iraq is now such a success.

Instapundit weighs in on the Supreme Court’s options in deciding the Heller 2nd Amendment case. None of the options seem palatable but for finding an individual right to own guns.

Rich Lowrey reviews "A Farewell to Alms: A Brief Economic History of the World," a book by Gregory Clark that covers just how important capitalism has been to the world’s development. Some of the observations are breathtaking.

Don Surber names names as he documents how the Dems passed judgement on the surge in days gone by.

The anti-gun crowd is spiraling up . . . but their claims are lacking more than a little in the veracity department. This from Volokh Conspiracy on some wild claims in the LA Times

The secret collaboration between CAIR and Representative John Conyers raises concerns over the lawmaker's support for "a group unambiguously proven to be part of the Muslim Brotherhood-Hamas infrastructure."

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