But obviously speculation plays a role in the price of oil.
In fact, since President Bush announced last Monday that he was lifting the executive prohibition on offshore drilling and urged Congress to lift its prohibition, the price of oil has dropped about $20.00 a barrel.

According to columnist Jack Kelly, writing for the Toledo Blade:

"On July 15, President Bush announced he was lifting the executive branch moratorium on offshore drilling. In the 24 hours that followed, crude oil futures plunged $9.26 (6.3 percent), the biggest oil price decline in 17 years."
"'Traders took a look at a feisty and aggressive George Bush and started selling the market well before a new drop of oil has been lifted,' said financial analyst Lawrence Kudlow. 'If Congress moves to seal the deal, oil prices will probably keep on falling. That's the way traders work. They discount the future. Psychology and expectations can turn on a dime.'"

That's unprecedented!  The price of oil went down approximately 15 percent in one week.  About half of that drop occurred in the first day! It should be FRONT PAGE NEWS... The presses should be stopping!
But the major media only gave fleeting mention to the price drop!
Why?

This quote by Senator McCain on the lifting of the Executive Ban on drilling by President Bush is in an article on wral.com, a television station in North Carolina.

Sen. John McCain, the presumptive Republican presidential nominee, called Bush's move "a very important signal" and prodded his Democratic rival, Sen. Barack Obama, to drop his opposition to offshore drilling. "If we can show that we have significant oil reserves off our coasts, that will clearly affect the futures market and affect the price of oil," McCain said.

It took all of 90 seconds to find an article on CNN Money that debunked the claim. The price of oil has definitely dropped in the last few days, but it isn't because of President Bush's proposal.

Select excerpts from an article on CNN Money:

Oil tumbles $4 on slumping demand

Inventory report shows higher-than-expected stockpiles of crude and gasoline, as demand for oil products slumps. Bearish Fed Beige Book worries traders that demand destruction will continue.

NEW YORK (CNNMoney.com) -- Oil prices continued to decline Wednesday, after a government report showed stronger-than-expected inventories and a Federal Reserve report showed a weakening economy.

Light, sweet crude for September delivery fell $3.98 to settle at $124.44 a barrel on the New York Mercantile Exchange.

Oil has tumbled nearly $23 since setting a record of $147.27 just eight trading days ago on July 11. Prices have not been this low since June 4.

Inventory report: In its weekly inventory report, the U.S. Energy Information Administration, a government agency, said crude stocks fell by 1.6 million barrels last week. Analysts were looking for a drop of 1.9 million barrels, according to a consensus estimate of oil analysts compiled by Platts.

Though crude supplies fell, stockpiles of petroleum-based products rose much more than expected. That sent the price of oil sinking on expectations of weakening demand.

Distillates, used to make heating oil and diesel fuel, rose by 2.4 million barrels while gasoline supplies rose by 2.9 million barrels. Analysts were looking for a 2.2 million barrel rise in distillates supplies and a 500,000 barrel rise in gasoline stockpiles.

"On the product side, demand is bad," said Phil Flynn, a senior market analyst at Alaron Trading. "In terms of gasoline supplies, we have to find someone around here who wants to drive a car, because we don't have a place to put it all."

And, the money quote:

Gasoline stockpiles increased, even as refineries operated at 87.1% of their operable capacity last week, down from 89.5% the prior week.

That's because demand for gasoline in the United States has fallen 2.4% from the same period last year, according to the EIA report. In a weekly pump spending survey conducted by MasterCard, demand for gas in the United States fell last week for the 13th week in a row.

Another article on expressmilwaukee.com, the online site for the Shepherd Express of Milwaukee, WI.

Think You Know John McCain?

Offshore drilling won't reduce gas prices

By Lisa Kaiser

Republican nominee John McCain's answer to energy independence includes the dubious-- but superficially attractive--pledge to end the ban on offshore drilling.

But like his gas-tax holiday proposal, McCain's desire to drill in the outer continental shelf doesn't make any sense economically.

McCain--who has accepted more than $1 million from Big Oil donors--is hoping that voters who are outraged by the high cost of gas will support his desire to find new domestic sources of oil and natural gas. According to McCain, drilling for oil off the shores of California, Virginia or Florida will add more oil to the international market-- which will then lower prices--and reduce America's dependence on expen sive, foreign oil. President George Bush has echoed McCain's proposal and has lifted the presidential moratorium on offshore drilling, although the Congressional ban remains in place until 2012.

Money quote:

An Insignificant Impact

The United States already allows off shore drilling in the Gulf of Mexico, where oil and natural gas are relatively easy to extract.

The EIA found that, as of 2003, there were about 40.92 billion barrels of tech nically recoverable undiscovered crude oil in the Gulf of Mexico. In contrast, there are only 18.17 billion barrels of crude oil in "off-limits" offshore areas in the Pacific, Atlantic and a small portion of the eastern Gulf of Mexico. So why not drill where it is currently legal and supplies are greater?

Allowing offshore drilling in off-lim its areas would only increase production by about 3% within the United States by 2030. The EIA found that since oil prices are determined on the international market, the additional offshore oil would have an "insignificant" impact on the world price of oil.

If you have time, read both articles and then go forth and do battle.

Update: I just found an article on the CNN site that quotes McCain giving Bush the credit for the drop in oil prices.

"In case you missed it, soon as the President announced that we were going to end the moratorium on offshore drilling the price of a barrel of oil went down $10," the presumptive Republican nominee said at a Wilkes-Barre, Pennsylvania town hall.