Forcing Up Gas Prices to Cost Obama Re-election

Superhuman effots by congressional repugs haven't been enough to stop the economic recovery, much less tank it completely. So what's left? Spiking gas prices, of course. That will bring the recovery to a screeching halt and piss off voters at the same time - it's a win-win!

Zandar doesn't say it in so many words but I will: the same people who are bankrolling Mitt Romney and the repug Super Pacs are speculating in the oil markets to force up gas prices this summer and thus sabotage President Obama's re-election campaign.

Good ol' West Texas Intermediate has been hanging around the $100 a barrel mark for quite some time now, but the real issue is gasoline prices have hit the $3.50 average well before the summer driving season. What's driving the price up? It sure as hell isn't demand.

Strangely, the current run-up in prices comes despite sinking demand in the U.S. “Petrol demand is as low as it’s been since April 1997,” says Tom Kloza, chief oil analyst for the Oil Price Information Service. “People are properly puzzled by the fact that we’re using less gas than we have in years, yet we’re paying more.”

Kloza believes much of the increase is due to speculative money that’s flowed into gasoline futures contracts since the beginning of the year, mostly from hedge funds and large money managers. “We’ve seen about $11 billion of speculative money come in on the long side of gas futures,” he says. “Each of the last three weeks we’ve seen a record net long position being taken.”

Somebody's making huge bets that gas prices are going to be through the roof, so much so that hey, gas prices are going through the roof. Record long futures this early in the year when demand is at a 15-year low seems like a lousy bet on paper, but a lot of people are betting a lot of money that the country will have to deal with $4.50 a gallon soon. And lo and behold, up goes both crude and gas as the long money becomes a self-fulfilling prophecy. All canoodling aside in the Straits of Hormuz, this is very much looking like what happened in 2008.

Funny how that works.

President Obama and the Democratic Party need to get out in front of this right now: expose the speculators, explain what they're trying to do, condemn them and then take whatever executive action is possible to thwart them.

Today.