A Quick History of War, OPEC, and Gas Prices - Learn Liberty

We've all felt the pain at the gas pump as gas prices seem to rise overnight. What causes these dramatic shifts in the cost of gasoline? Prof. Art Carden explains that gas prices fluctuate based on supply and demand for oil. For example, international conflicts like the Iranian Revolution in 1979 and the political unrest in the Middle East in the past few years can lead to decreased supply, causing prices to increase. By contrast, innovation, new technologies, and new producers of oil can increase supply and lead to lower prices. Demand can change, too: the growing economies of China and India are contributing to increased global demand for oil, which brings prices up. The East Asian crises at the end of the 20th century led to lower demand for oil, and prices fell. Prof. Carden says that we don't need to worry about running out of oil, though. Prices, profits, and losses in relation to oil provide incentives for innovation and improvements.

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[Koreo-Kick]

What about the PetroDollar System? Why not teach everyone about how our currency is tied to that foreign oil? Thus our involvement in the Middle East and the underlying effects is has on inflation and gas prices.

[Ookoolicious]

TO EVERYONE BITCHING ABOUT THE CAR: Just listen to the video rather than watching it. Helped me a bunch.

[Nicolforest]

Yes, that is absolutely right, there is a spectrum of values, reflecting many different perspectives. In addition, value may be added (or subtracted) at many points along the value chain.
One of my main criticisms of standard economics is the difficulty it has with representing human values or measuring sustainability, wealth and happiness.

[Devincan]

maybe i am misunderstanding what your trying to say but the graph said prices were adjusted according to modern inflation, in other words, the prices you saw are the modern day equivalent not the actual prices.

[Loathomar]

The video clearly adjusted historical oil prices for inflation. Oil prices reached in all time high back in June 2008 both nominally and inflation adjusted $145.29. Inflation cause all prices and average wages to rise, but we can also adjusted for inflation easily.

[DouglasEdward]

A fair and correct point but Canada;s prices(while discounted) are still affected by the global price for oil.

[bryanthomas]

I really don't understand why the guy is in the car.

[electronsauce]

Does it? Google 'price of food graph' and compare it to the price of oil. S&P Index shows the same graph too

[RockJoeMTL]

The floating DeLorean gimmick might've worked better if the bobbing effect was more subtle. For instance, around 1:19, the left-right motion drags Carden's head across almost a quarter of the screen! That's insane! Less is more...

[NOLAMarathon]

In general, I like it very much. But I have four issues with it: (1) It doesn't adjust gas prices for inflation; (2) it doesn't discuss the declining price of gas as a proportion of a wage-earner's paycheck; (3) it doesn't discuss the chunk of government tax on on each gallon, which is higher than the service station's profit on each gallon; and (4) the video is NOT for those susceptible to motion sickness. Otherwise, it's good.

[rasetoi]

Hemp would be a form of solar energy capture. It does look interesting. Thanks for bring that to my attention, I haven't heard of it before.

[anacap]

Technically speaking, we will never run out of oil because whatever oil that isn't discovered will be too expensive to find. Another way of saying it is we will never know the last barrel of oil is really the last barrel.

[hybridmcgee]

I recommend understanding how washington works(for money), and perhaps an etiquette class or two. You can try to think in a restrictive economics bubble and get angry when someone penetrates it, but it doesn't change or address the factors that anchor these industries in the economy. The economy isn't some random thing at all when competition is contrived or prohibited.

[guinthehouse]

not the best video I have seen from tgis channel but still informative.

[stevemcgee]

Interesting idea with the car, travelling through time, etc. - but slow down at least. I think 45 more seconds - same content - would help us follow what you're presenting.

[jackmcslay]

Where does it say unlimited supply? It says that with increasing prices, other alternatives become cost-effective

[electronsauce]

As long as inflation stopped yeah it would even out and it is constantly evening out. I don't think speculation has any effect on the long term price of oil. Again, that'd be an example of price fluctuation. I'm sure there are other factors to the long term heightened price of oil, but I have a feeling inflation is the #1 reason

[Malthus]

Well doesn't inflation equal out across all goods and services in the long run? Unless you think that there is some other indirect factor such as speculators buying up oil in response to inflation or inflationary expectations.

[GregoryTheGrster]

I agree! I don't think that the hovering B2tF effect enhanced the lesson.

[Anonyminded]

OPEC rules oil reserves and its main indicator if there r enough oil reserves to survive next year, but looking on the amount of oil we spent last century Iam not sure OPEC is a way to go in the future...