In the spin-room after yesterday’s debate, Rick Perry declared that if you started to see Newt Gingrich climb in the polls, then the price of oil around the world would drop,
The reason: Newt Gingrich’s aggressive energy policies would signal to the market that more supply was coming, this dampening the price.
This is a GOP fantasy: That energy policy choices could influence the market like this.
In the long-term it seems obvious that energy policy could expand supply and reduce price. In the short and probably even medium term, this is hogwash.
So for Rick Perry or Newt or anyone else confused, here’s a few charts from Barclays’ “Oil Sketches” report, which get at some reasons for the high prices.
They’re all mostly self-explanatory but the gist is: Tight supplies, low inventories, and growing demand.
Add it all up, throw in some Iranian and Syrian fears, and voila! Pain at the pump.
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