Obama drives oil prices down with threat of

[ben_meyers]

windfall profits tax. I guess the big oil bastards were listening!

Obama shelves oil company tax after price fall

CHICAGO/WASHINGTON (Reuters) - President-elect Barack Obama is not planning to implement a windfall profit tax on oil companies because prices have dropped below $80 a barrel, an aide said on Tuesday.

"President-elect Obama announced the policy during the campaign because oil prices were above $80 per barrel," an aide on Obama's transition team said. "They are currently below that now and expected to stay below that."

Oil prices have fallen from a record $147 a barrel in July to under $50 this week.

Obama, who signaled early in his campaign for the White House that he would take an active approach to oil markets as president, had planned to use the revenue from a windfall profits tax to fund a tax rebate for low- and middle-income families struggling with high energy prices.

But the aide said Obama's presidential campaign had already taken the price drop into account six weeks ago. When Obama laid out his economic plan for the middle class in mid-October, revenue from a windfall profit tax was not included because of the price change, he said.

Thats how you jawbone down the prices!

http://www.reuters.com/article/vcCandidateFeed2/idUSTRE4B206W20081203

[Spider Jerusalem]

1. Sorry, but you're wrong about the reason for the decline in prices.

It has a lot more to do with global economic instability, reduced demand and decreased speculation on fears of a potential economic depression than it does with any political action.

[yurbud]

4. speculation might have decreased because they were afraid Obama would change the rules of the game.

[Spider Jerusalem]

6. I think that's a ridiculous and utterly absurd assumption.

Have you ben paying attention at all to the economic news in the past few months?

[sandnsea]

7. But I bet tax increases

depress investments, right?

[Spider Jerusalem]

8. Grasping at straws?

There is no logical reason to ascribe the decline in per-barrel cost of oil on world markets to the proposed actions of the future Obama administration when the decline is explained quite well by reduction in demand, economic growth going negative, and investor fears of a far-ranging economic recession that may deepen into depression.

[sandnsea]

11. I asked a question

why no answer?

[Spider Jerusalem]

13. Taxes haven't increased, have they?

If the political side were responsible then you'd see as much profit-taking as possible now, since any tax increase won't take effect until the next tax year, not THIS one.

[sandnsea]

15. So taxes affect investors' behavior

Why won't you just admit it.

[Spider Jerusalem]

18. You're arguing for something that hasn't happened yet and wouldn't affect short-term investment.

Which you seem incapable of admitting.

[sandnsea]

19. I'm not arguing "for" anything

I'm simply stating the obvious. The same people who insist the oil prices couldn't possibly have anything to do with a windfall tax are the ones who always insist taxes hurt investments. So which is it?

[Spider Jerusalem]

20. There is no tax as yet, is there?

And that taxation would be placed on oil companies and not on indivudual investors and speculators, would it not? Your conclusion is nonsensical, as the decline in oil prices is more than adequately explained by several other and much more present factors than the possibility of a future tax which would not take effect until at least a year from now.

[sandnsea]

21. I haven't stated any conclusion

I am simply asking you whether you believe taxes affect investors, and their view of the profitability of the company they're invested in. It's a simple question really, that you won't answer.

[Spider Jerusalem]

22. It's not a relevant question to the topic at hand.

Not when talking about investment and speculation in a *commodity* which is broadly traded on a global market, and investment in which is external to any investment in a particular oil company. This is very basic and very straightforward.

[uponit7771]

10. Unnn, I would've thought the same but after 4 consecutive days of market ups after Obama spoke then

...it's not far fetched...reaching but not far fetched.

An argument can be made that Obama supporting Tesla motors and GM and getting their products on an SUV platform along with a mid sized one and getting the cars AFFORDABLE and maintainable would for ever screw big oil in THIS country.

I have yet to here Obama's support for Tesla or GM's Volt yet though but I have confidence he'll point us closer to oil independence than Bush did.

[Spider Jerusalem]

14. I don't know that Tesla or Volt are the answer.

Something I think WOULD be to an extent a partial answer: make the Big Three jointly commit to increased production of commuter buses as part of a 'greener economy' effort of rebuilding and strengthening public transit; make increased transit incentives a priority (which will help municipal governments through job creation at a time when municipalities and states are also hurting), and push for greater investment in biodiesel technology in addition to hybrid electric (biodiesel won't replace oil, not totally, but it's a good start, and probably a better use of corn surplus crops than corn-based ethanol; electric isn't really a long-term 'green' solution anyway, considering that 50% of our generating capacity is from coal-fired power plants).

[uponit7771]

17. +1, very pratical and it's also VERY VERY now!!! Don't have to wait 2 years or 2 days

[Occam Bandage]

2. Er, that would more likely be "collapsing demand as result of global economic downturn

drives down oil prices."

[mikiturner]

3. Not shocking

Hard to go after them for windfall profits when prices are cratering.

[BrklynLiberal]

5. They have already made their windfall profit. They should still be taxed.

I think the idea of the oil companies bailing out the auto industry is perfect!!

[uponit7771]

12. If Obama's team is still taking phone calls you should give them one :-)...good idea!!!!

[niceypoo]

9. Banks wont loan money to speculate with

They would rather just keep it for themselves

And the execs know hearings are coming, under OATH!

[ecstatic]

16. 50 should be the cutoff number, not 80!! nt

[dbmk]

23. From 147 to 50 - just because Obama mentioned windfall profit tax?

Not likely.

When you have the prices we have had over the summer combined with a general downturn in the economy, demand drops drastically - so stocks start piling up. At some point someone looses their nerve and starts selling.

Unless Obama has the power to tax foreign oil producers, this has little bearing on reality.

[DemocratSinceBirth]

24. If The Recession Deepens Enough We Might See 99 Cents A Gallon Gas And 20 Dollars A Barrel Prices !