Why Gas Prices Rise as the Dollar Falls

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I found this to be one of most straightforward explanations of this topic I have ever seen. That said, it seems reasonable that the problem of rising gas prices ( not necessarily the price of oil as it is 40% cheaper than it was during the 2008 mess) must be solved in the short run by supply and demand and in the long run, sustained by fixing the weakness of the dollar against our trading partners. It also seems reasonable the only thing to accomplish that would be to eliminate the income tax and focus on taxing consumption, not production. Twenty trillion dollars in American investments (ie, jobs) would coming running home, prices would fall, employment would soar and the economy, once the envy of the entire world would gear back up into the economic miracle it is. I find it pathetically comical and dishonest that now our government, the biggest manipulator of prices has announced they are investigating the oil speculators and traders as the responsible party for high gas prices.

Ron of IN 8:07AM April 24, 2011

Sounds like a simple "supply and demand" issue. Time to start drilling our own oil!

A.E of CA 2:58PM March 24, 2011

Seems as though there is no regulation what so ever to this never ending saga.The working personel tries to manage and survive in an already weaken economy and the price continues to rise, is there no end in sight?? The lesser a barrel of oil cost the more the price at the pump rises, so who benefits?certainly not the consumer.Have we as a great nation become so dependent on other countries that we are slowly but surely heading down the wrong path.Have we as a country collected on the debts owed to the United States by other countries. Until we can come together as one body in our Government and not bargin on one bill to pass if you pass another we will never regain our true face as a nation.We are not standing together and are definitely falling.

Carl of TX 6:02PM January 20, 2011

i hardly understand this.im only 12.could someone please explain this...im working on a social studies project about it.im not putting my real email cuz i dont want any stalkers.:))

Audrey of GA 10:08AM October 08, 2009

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Idlpsadw of CT 5:43AM July 15, 2009

last report i saw both bush Jr. and Sr. have a lot to loose if oil prices go down. when is enough enough you greedy bastards!! Hasnt anyone seen the pictures of both former Bush's smiling and have a photo taken with some arabian prince/oil barron. Oh but I'm sure there just friends(cough gag spit puke) Formert president G.W. Bush is out thank God now lets leave him to his stinkin ranch, and keep him out of the public eye. Just looking at that greedy bastard makes me sick. Why you ask? BECAUSE I AM ONE OF THOUSANDS THAT HAS LOST A JOB DUE TO OUTSORCING TO CHINA, AND ALONG WITH MY JOB WENT MY HOME!! Thanks a lot G.greedy W.worthless Bush. and now as every summer up go the gas prices. How do you sleep at night you slime ball?

jeff klein of WI 12:12AM March 30, 2009

Who in there right mind would invite former president G. W. Bush to speak on the economy or fuel costs. does he not have a big stake in oil?, is he not the moron that let this country fall. the G stand for Greedy the W stands for worthless. of which he is both! That moron should be deported to his home country, (that would not be america) He should have been empeached for stupidity and greed. That sorry sack of crap should go into hiding and never show that greedy double face again. He is the definition of Greed in this country, along with AIG and all the other greedy morons that like to live on the tax payers dime. Times should change why cant we as the people that make up this country live on there dime? Why is it Bush filled nafta with loop holes? so employers can start there slave labor camps in countries that dont have the sfatey and health standards we do. Look at the Crap thats come from China over the last few years, Poison toys, poison baby formula. and if any one watched the olympics, did you notice every one in China was wearing dust masks, probably because there are so many american companies over there polluting the place. LOWER GAS PRICES AND BRING OUR JOBS BACK YOU SLIME BALL TRADER!!

Jeffrey E Klein of WI 11:59PM March 29, 2009

If we say that the oil demand incresses as the dollar goes weak. but lookinat it from supply and demand: when the oil demand increses there is an increase in the demand of dollar. hence the dollar shud strenghthen with increaes in oil. But that is not a case seen in the present scenario. if some one could explain me why we have the same cycle of oil prices goin high and dollar weakning or in present scenario oil prices weakning and dollar is on a up hill ride.

Faiza 3:41AM March 04, 2009

It's late February, 2009. Nearly a year after this article was written. The Fed is continuing to pump hundreds of billions into our now anemic body of our currency. The world is pouring currency into their soveign nations as a slow-motion solution to the chaos of economic decline. Housing foreclosures must stop but little acknowldegement seems apparent with this issue. Oil and most all commodies are cheap but oil simmers ever slightly higher. Just as we think we might lift ourselves out of this depression, banks and investors await to ambush oppotunities just at the right moment. The side-lined hundreds of billions will then pour into the economy. Like buzzards waiting for the body to quit life, investors will nearly at once elbow like jackels for profitable morsels. Oil and all comododies will jump. The feeding frenzy will present its own chos which will swell into a tidal wave of inflation. And this, not fully undestood, is what many are hoping for. Opt for a little home on a nice piece of land in the country, just as a hedge.

Thomas of OR 1:56AM February 28, 2009

I think that the oil companies are completly and totally scaming us because just 10-20 years ago gas was just shy of a dollar and now it is almost 5 dollars and it shouldn't be that high, exxon alone made over five billion dollars in prophet, over 5 bilion in the past year!

of 1:31PM September 23, 2008