The idea of offshore drilling is on everyone's mind, but are President Bush and John McCain's calls to start drilling off the coast of Florida and in wildlife reserves in Alaska going to help us save at the pump?

Stephen Colbert said on his show the other night: "When I first started paying $4/gallon for gas, I didn't mind, I thought I was just getting better gas." Being the king of satire, Colbert 'sided' with the offshore drilling proponents, mostly because he hates bears.

But all kidding aside, the plan will not lower gas prices for at least 15 - 30 years. Even if both coasts, including every offshore site in California, New Jersey, and Virginia were also opened up to the oil companies, we wouldn't see 'cheaper oil' anytime soon. So why do they keep proposing it as the money saving venture we need to do?

I don't want to delve too much into conspiracy theories or political rants, but many people are left wondering if these 'offshore proposals' are meant to appease oil companies eager to get more sites before Bush peaces out for good.

The honest truth of the matter can be explained succinctly by Brian Kennedy, Senior Vice President at the Institute for Energy Research, a not-for-profit organization based in Washington, D.C. In an interview with MainStreet he says increased domestic oil drilling is a long way off from lowering our gas prices. Even if it does happen, we may only see a few cents dropped off the price of a gallon. And that's not for at least a few decades, imagine what the prices will be at that point.

One NY Times editorial even attempts to explain how the oil companies already have 68 billion acres of land with oil that they just aren't using, including other drill-able areas in the Gulf of Mexico and in the non-wildlife protected zones of Alaska.

The only clear solution, which Obama has been trumpeting, is to put the money into non-oil based technologies like greener alternatives and larger electricity grids for electric cars. But as eloquent and pro-active as Obama is, we still won't be able to shake the oil habit anytime soon. High gas prices are for Americans have become the new reality. But if you think we're complaining, take a look over at Europe.

Can McCain come up with some feasible options besides do-nothing gas tax holidays and ineffective domestic drilling proposals? I hope so.

Everyone loves a good old fashioned WallStreetFighter 'gas and oil prices' post. Show your love/hate in the comments section. As if you need to be told to...

MainStreet: Drilling OffShore, June 20, 2008
Care2: Lowering Oil Prices?, June 19, 2008
AP: Obama criticizes McCain on Offshore Drilling, June 21, 2008

The price of gasoline will continue to increase this summer, and I dare you to find me one person in this country who is happy about it. People who live in the wilderness and don't interact with society? Gas thieves? Gas cap lock manufacturers? Ok, maybe them.

You might think that gas station owners and big oil companies are loving these record high prices. But you would be wrong. We've all heard that these high gas prices are conversely affected by the sale of gasoline, because it is lowering the demand for the fuel in the market. The less people who can afford the high prices, the less that is sold.

FiveCentNickel, an interesting money blog, took a look at the Department of Energy's most recent fuel update numbers and did some crunching.

Here is the latest breakdown of what goes into the price of gas:

73% - Crude oil
11% - Federal and state taxes
10% - Refining costs and profits
6% - Distribution and marketing

For some of you, this might be obvious, but it's still an interesting breakdown to examine. The big number that gets your attention is the price of crude oil. In spite of today's announcement that Saudi Arabia will be increasing oil production, prices continue to hover around the $135 - $140 mark.

But in further detail, take a look at that 6% distribution and marketing. That percentage includes the cost of what it takes to get the gas to market plus the gas station's profits.

So as you can see your local Shell and BP aren't really the well-endowed bandits you might think they are. With the cost of trucking and shipping the gasoline to stations rising because of high gas prices (being the fixed proportional numbers they are), the gas companies are biting a similar bullet.

My solution? Well if drilling in Alaska and off the coast of Florida are frowned upon by all those environmental conservatives (polar bears like Coca-Cola, but they don't like oil?), why not get some drills and roughnecks up to the Moon. How much you wanna bet there is more oil floating in the middle of the moon (next to all the dinosaur bones) than in Saudi Arabia?

FiveCentNickel: What Goes Into Gas Prices, June 13, 2008

A lot of people would have thought with record-high gas prices in the U.S., all the oil companies would be making a killing. At least for one oil giant, that isn't the case.

According to a report in today's New York Times:

Exxon, the world’s largest publicly traded oil company, said it would sell the roughly 2,220 service stations it owned across the United States, including about 820 that it also operated.

The company will maintain the Exxon and Mobil brands, an Exxon spokeswoman, Prem Nair, said.

Of the 12,000 or so Exxon Mobil-branded stations in the United States, about 75 percent are already owned by others.

Exxon cites "very challenging" business conditions as the cause for selling off its retail gas business in the U.S. Apparently, in spite of gas prices being 31% higher than last year, the gas station business is still not a big money maker.

The company says the profit margins inherent in its business model are not feasible. Looks like they see more money right now in selling these stations to independent owners.

Does this mean the low demand for gas is finally hurting the gas companies? It was only a matter of time before people began to realize they couldn't afford to fill up with a gallon costing more than $4.

Congratulations, everyone! Keep those gas cap locks fastened tightly and don't stop burning down your local fill up spots! I think all those half-baked schemes might actually be working. No. Not really. Driving this summer will continue to suck.

NYT: Exxon Plans To Sell Its Gas Stations, June 13, 2008

Today was a wild day on the Street. With jobless claims, record-breaking oil and a stock sell-off - it was one hell of a Friday.

One of the funny things about Wall Street and the stock market is that dozens of well-intentioned analysts could be screaming about 'overreactions' and 'throwing out the baby with the bathwater', but once momentum picks up on negative thinking, it's hard to stop it.

Many investors gauge the health of the economy on the unemployment percentage in the country. Today that percentage jumped from 5.1 to 5.5, a 22-year high. Investors took this as a sign the economy was weakening and recession symptoms would continue. As a manifestation of that collective fear, the Dow Jones industrial average fell 365 points by the end of the day. Investors wanted out.

According to an article from CNBC, contrary to what investors feared about the economy weakening,

many economists said the rise in unemployment was attributable mostly to more unemployed people trying to get back in the jobs market and college and high school students looking for summer work.

They really should keep the 'High School Kid Saving Up For New iPods' employment rate as a separate figure from the 'Dad Got Fired And We're Losing The House' employment rate. Then these kind of mix-ups probably wouldn't happen.

But there was a whole separate story that freaked a lot of people out today. Oil.

Crude oil prices jumped up past $138 a barrel, after sitting at monthly-lows only a few days ago (An $11 jump in one day). The sudden jump in oil prices is largely being reported as 'speculator driven', meaning these are market games meant to drive prices and make profits from trading oil. Speculator driven sell-offs or run-ups usually don't sustain those prices.

However, there is a report circulating that gives legitimacy to the claim that we will soon see $150 barrels of oil. If that 'prophesy' comes true, expect to see significantly higher gas prices. $6 a gallon as the norm maybe?

This all came as quite a surprise to many on the Street because Thursday was such a fun-loving happy day. Yesterday's market scored its biggest single day gain in almost 2 months. I heard one commenter on CNBC likening it to "when someone is about to commit suicide, they usually act happier than normal."

Probably in poor taste to make that kind of comparison, but gets the point across I guess.

What will next week bring?

CNBC: Stock Selloff Offers Good Chance To See Bargains, June 6, 2008

CNN Money: Dow Tumbles 395 Points On Oil Spike, June 6, 2008

Maybe you're saying 'duh' to that headline, but few people realize what all these oil worries look like in number form.

Let's take a look at some of the travel statistics facing us this Memorial Day weekend:

• In the U.S., national gas prices rose today for the 17th straight day.

• The average price of a gallon of gasoline rose from $3.831 yesterday to $3.875 today.

• Last year at this time, the average was $3.23 per gallon.

• Gas stations in Alaska, Connecticut, Illinois, New York, California, Hawaii and Michigan each average over $4 per gallon.

• Wyoming and Arizona are the only states averaging less than $3.70 a gallon.
  

• According to a Deloitte & Touche (one of the Big Four auditors) survey, 12% of Americans surveyed said they are completely canceling their Memorial Day plans due to high travel costs...

• In spite of the costs, it is estimated the average American traveler will drive 91 miles this holiday weekend.

• According to the US Environmental Protection Agency, the average car on the American roads gets only 20.2 miles per gallon.

• Only 11% of Deloitte's surveyed American plan to use air travel this weekend.

• Due to oil prices and fuel surcharge fees, the average plane ticket will cost 8% more this year.

Not that we don't completely trust a big accounting firm like Deloitte to tell us what America is doing, but let us know in the comments section what your weekend plans are. Will you be changing your annual routine?

Be sure to note if you are "rich as hell" and "couldn't give a crap about oil prices", as that may affect how we view your opinion.

CNN Money: Memorial Day Travelers face headwinds, May 23, 2008

Desperate to avoid gas price riots, Congress voted yesterday to stop filling the national oil reserve.

According to today's NYT article, the 'Strategic Petroleum Reserve' is already 97% full and yet we continue to purchase and fill it with over 70,000 barrels a day. With oil prices hovering around $125/barrel, it's becoming increasingly expensive to keep doing so.

The reserve is designed to act as an emergency backup in the event of a fuel shortage.

Speaker of the House - Nancy Pelosi said, after speaking to analysts, that this act may decrease the cost of gasoline by 5 to 24 cents a gallon.

There are plenty of naysayers, and in the spirit of ever-increasing partisanship most of them are members of the opposing party. Like this guy, who doesn't sound at all like a jerk:

But Representative Joe L. Barton of Texas (R) said the measure was meaningless. “If all the members of the House would go out onto the steps and clap our hands three times and say, ‘Down prices, down prices,’ that would have as much impact as passing this bill,” he said.

Well Joe, that plan really doesn't seem too far fetched when you think of how any other verbalization of policy effects market and oil prices. Even the utterance of the name of some Third World country and the word 'pipeline' in the same sentence is enough to make prices go up a few dollars a barrel.

Pretty much everyone agrees, that the McCain-Clinton 'gas tax holiday' was merely pandering without a beneficial solution. But is this one really any better?

Although it makes a lot of sense to stop filling the reserve when it's already 97% full, it makes even more sense to quit while it costs so much to keep filling.

This measure was passed by both the House and the Senate by a margin of 385 to 25 and 97 to 1. It also looks good on the Bush end of things. The President is unlikely to veto this measure.

In the coming weeks this plan should be put into action and then we will see if those prices tick down a bit. Right around that time, hopefully there won't be some massive pipeline news that makes us wish we had that extra 3% in the reserve. Fingers crossed!

NYT: Congress Votes To Stop Stockpiling Oil, May 14, 2008