The Real Cost of American Oil
Americans tend to act like a group of addicts when it comes to certain things. We are never going to give up our massive addiction to fatty foods, as seen by protests against trans-fat bans in major cities. We are always going to want lower taxes and more freedom, as seen in the Tea Party demonstrations, even though we don't really know the cost of it. We are also working more than most of the other countries on the planet, and often getting less accomplished while we are there.
But the biggest addiction we face as a nation has to be our reliance on automobiles and the internal combustion chamber. We have always had an unhealthy relationship with our personal transportation devices, but the obsession has grown to staggering new heights. The aftermarket car parts industry accounts for $257 billion of our economy, which comes after the initial vehicle purchases. While the automotive industry makes great money, the oil industry profits from continuous fuel-injections.
When we think of the skyrocketing prices of oil in America, it is easy to conjure up images of terrorists and unstable dictators in the Middle-East. While the media tells us that people like Muammar Gadaffi and Saddam Hussein needed to be killed in order to tap into their strategic oil reserves, about 36 percent of our oil is produced domestically. Texas, California, Oklahoma, the Gulf of Mexico, and even North Dakota are some of the largest producers of oil in the US.
While a good portion of our oil comes from domestic sources, you would think that there is still 64 percent that must come from the Middle-East. Think again. Most of our foreign oil comes from places like Mexico, Russia, and our neighbor to the north, Canada. Only about 11 percent of our foreign oil comes from OPEC countries.
The price of oil is so high in this country because of the simple law of supply and demand. We are craving the product so badly that the oil companies have more reason to exploit the need and collect profit from it. We rely on the black stuff for just about everything. Getting to and from work is just the tip of the iceberg that gasoline keeps frozen. All of the shipping, delivery systems, and lawn and construction equipment we use relies on it as well. If we took it out of our economy, America would fall straight on its face.
Another reason the prices of oil are so high in America is because of corrupt speculators on Wall Street. CNN reports that a group of five oil speculators were charged with manipulating the price of oil futures contracts and making a profit of $50 million. These investors place their money on oil in hopes that it will continue to raise in price, while they simultaneously manipulate the markets in their favor.
The next time you are complaining about President Obama not keeping the price of oil down because he wants to pull out of Iraq, you should reconsider your criticism. Instead, draw your attention to those protesting the bailouts of big banks who get us into this trouble to begin with.