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8 Νοε 2013 (πριν από 3 χρόνια και 11 μήνες)

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By: David Radich

Gas Prices

APUSH period 4

Gas prices are rising due to inflation, high
demand rates in the United States, and
currently because the Obama
administration is putting restrictions on
drilling.

Statement

First Cause of Gas Price Increase


The value of the United
States Dollar is declining
and that is causing the
prices of gas to increase.


“A decline in the value of
the U.S. dollar to its lowest
in three years, combined
with an unexpected drop
in crude stocks, pushed
the national average price
of fuel last week to nearly
a dollar per gallon higher
than it was a year ago.”
(Dothan Eagle)


Oil is purchased and sold with
dollars in the market. So when
there is inflation, there are more
dollars needed to buy oil. Part of
the inflation in the united states is
because there is to much money
being circulated. There is to much
being printed. This means that
more dollars are needed at the gas
pump to purchase oil.

Inflation rate and Gasoline prices from
1918 till present time

Second Cause to Rising Gas Prices


Obama administration is canceling permits.
Obama feels that oil is a cause of global
warming and he wants to fight against that.
He wants to use other sources of energy.


However the United States needs oil to
survive. Oil is like air and if oil is cut off
from the United States it will make it much
harder to prosper and live


Obama administration


They ban offshore drilling.


His administration didn’t want oil drilling
which adds up to less supply for people in the
United States.


He also pushed for taxes on American energy

Obama administration


Obama posed an embargo on oil drilling after
what he had seen occurred in the Gulf of
Mexico with the huge oil spill.


The administration banned offshore drilling
for six months.


This caused many drillers to move to other
parts of the world .

Low Supply

Technically, the United States is
not low on supply.

We have much more oil
available to us than what OPEC
has. It is just a matter of drilling
for it.

We are being restricted on
drilling for oil on the offshore.
This is what is causing the price
of a barrel to be much more
than what it should be if we
actually drilled for oil.

Third Cause of why Gas prices are
rising


There are conflicts between the
middle eastern countries over oil.


There are civil unrests within the
OPEC countries that purchased oil.
There is a sense of uncertainty of
what is going to happen to the
countries so the demand for oil is
high with the European countries
involved.



There is a high demand from the
Europeans for oil which creates a
high demand from the United
States as well to purchase oil. This
high demand and competition
causes gas prices to increase.

Nixon’s change in the gold standard
by ending it and then fixing the value
of the dollar. This is connected with
how nowadays the dollar is used with
trading oil, and it has a big impact on
why the prices of gas is raising. Nixon
lowers the value of the dollar which is
what is occurring now where the
value of the dollar is dropping. It just
ended up in hurting the economy.
Look what is happening today, our
economy is not doing so well.


Connection with Nixon’s presidency

Oil crisis of 1973

A war was occurring during the time
between Israel and Egypt and Syria.
Middle Eastern Arab states stopped
exporting oil to the United States and
increased the cost of oil exported to
western Israel to get the support of
them. The speed limit was lowered
and energy was conserved. The
rising oil prices benefited OPEC and
hurt the United States. At the time
known as stagflation was a period of
stagnant economic growth and
inflation.


Effects of the Oil Crisis

“The immediate results of the Oil Crisis were
dramatic. Prices of gasoline quadrupled, rising
from just 25 cents to over a dollar in just a few
months. The American Automobile Association
recorded that up to twenty percent of the
country’s gas stations had no fuel one week
during the crisis. In some places drivers were
forced to wait in line for two to three hours to get
gas (
Frum
, p.320). The total consumption of oil in
the U.S. dropped twenty percent. This was due to
the effort of the public to conserve oil and money.
There was an instant drop in the number of
homes created with gas heat, because other
forms of energy were more affordable at this time
(Arab Oil Embargo of 1073
-
74).” (Sarah Horton)


So What are three main causes to the
increase in gas prices currently?


Gas prices are increasing in price due to inflation, high
demand rates in the United States because of competition
with OPEC countries, and because the Obama administration
is putting restrictions on drilling offshore.


Do you think Obama’s administration
is doing good by preventing the United
States from drilling oil on the shore?

In my opinion, I feel that by stopping the
drilling to the offshore where we can get a
lot of oil is a bad idea. Obama says he
wants to use other energy to help out the
economy because oil is a cause of global
warming (Well global warming hasn’t been
proven). Oil is needed in the United States
for things to flow and work. The United
States highly depends on it and it would
help the economy money wise as well. Gas
would go down and more money would be
spent on oil because the prices go down
thus making the regulation of money much
better. So I feel that banning offshore
drilling is a bad idea.

What did Nixon do in thinking that he
would be able to “promote exports by
making American good cheaper
overseas” which ended up hurting the
economy?

While Nixon is president he decides to lower the value
of the dollar. He thinks this will help export more
goods, make more money, and help the economy.
However this hurts the United States economy because
the US hits a period of stagflation where there is
inflation in the dollar and also stagnant growth in the
economy.

How did Rising oil price hurt the
economy during the 1970’s?

Rising Oil prices hurt the United States economy
because it was a factor that contributed to
stagflation. The misery index at the time was at
10.8 which is not good. There was high
unemployment and high inflation rates. As the
prices on gas rose more people went from cars that
used up a lot of gas to smaller cars that didn’t use
up as much gas. Oil in itself hurt the economy
because there was not much being exported to the
United States, and there was a high demand for oil
because of the cars and factories.

Primary Sources That help Give Insight

The picture to the left is a photo of the
time period when the oil crisis was
occurring. This picture helps develop a
sense of what it looked like in the past
and how gas was being treated at the
time. This gives me a better visual as to
how gas was being limited to people in
the United States.


My dad also acts as a primary source. He
lived during the time and he was able to
tell me what is was like during the time of
the oil crisis in 1973. I got a better
understanding of the problems the
economy was facing and the ideas that
the Middle Eastern Arab countries had in
mind in banning the export of oil to the
United States. It made it much more
easier to relate to what is happening
nowadays with gas prices rising.

Bibliography


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