Does Obama Bear Responsibility for the Increased Gasoline Price?

Isreali-Iran saber rattling would alone make oil traders nervous, so the question is the marginal contributions of Obama’s (and Romney’s, etc.) comments on subjective expectations of a conflict and the effects of a conflict on oil flows.

My not too careful guess is that we’re down into the noise of daily price movements – less than a nickel a gallon – and that isn’t big enough to be driving current political debates on gasoline prices.

The conservative base, along with the extreme right wing base of the Republican political party and its members of the House and Senate, repeatedly claim President Obama is timid or weak in his public and private messages and position on Iran especially his preference for encouraging negotiation; I respectfully submit that your informative article, arrives a priori; flawed; rendering you sadly, among the many feathered tails wagging right along with misrepresentation of overall causal facts regarding gas prices, by the saber rattling GOP.

Leaving politics aside, as far as we can with a question like this one, it seems to me that there are a few facts which would be enlightening (which I don’t have at the tip of my fingers right now, but maybe someone reading this thread does).

First, what is Iran’s oil output today and what are its total recoverable reserves? Both absolute numbers and as fractions of U.S. and non-Iran nations’ numbers would be interesting.

What is the current U.S.+non-Iran output, and how much could it be increased in a free market given a set of policies, such as those advocated by the Republicans, which would promote that increase? I’m talking about a return to the normal permitting process in the Gulf of Mexico, opening up drilling in Alaska, green-lighting the Keystone pipeline, getting a sensible and predictable regulatory framework for ‘fracking’ in place, etc. There are also effects from restrictions on other energy sources which partly substitute for oil (e.g., coal) but my guess is that they’re not the main issue.

If Iran’s output is not much larger than the drop in current U.S. production, measured relative to what it would likely had been if the Republicans had been controlling the relevant policies starting in January 2009, then it strikes me as reasonable to assign most of the blame for the current high price to Obama and his domestic production policies. Otherwise, one could plausibly argue that the current tensions between Iran and the West might be an important factor in the price rise.

Reasonable?

@Judith Gomez,
You actually read my post in which I, like you, blamed three Republican presidential candidates for saber rattling, right? I think Obama is timid, but not in the way those three say. He should have told them to take a hike and he shouldn’t be kissy-face with Bibi. If he did that, prices would fall.

Would a rational market really respond to saber rattling? Seems more likely they would assess the President’s probable actions based on a variety of characteristics, especially the political dynamic, regardless of what the President said. The Iran effect would seem to be more about the political dynamic, rather than Obama himself. I.e., the same result would come from any politician seeking reelection and popularity

Oil is traded in USD. I would assume that policies that lead to a weak dollar also would lead to higher oil prices in US dollars.

I remember around 2008 when the Israeli Tourism Minister did some freelance saber-rattling about war with Iran and the price of oil shot up about $10. The next day the Israeli Foreign Ministry renounced everything he said — he’s just the Tourism minister, for heaven’s sake! — and the price went back down.

But I wonder how much money you could make in a few hours if you knew some idiot politician was going to say something stupid, for example, because you put the idea in his head.

Steve Sailer:
My congressman is John Dingell. He has been in congress for decades, was not remotely rich when first elected, usually says stupid things, has complete control of when he says them, and is very rich!

While I’m no fan of unnecessary saber-rattling, isn’t really the truth that the price of oil is so high because most of the non-Western producers have undemocratic and either highly socialist or crony capitalist governments?