Transcript for Ron Paul on Oil and Gas Prices (1-5-2008)

CHARLES GIBSON: People in this state, and everywhere, are worried about gas prices.

When 2007 began, oil was $61 a barrel. It was $100 (a barrel) last week.

We haven't even begun to see the demand that India and China is going to put on the world's oil markets.

Don't you have to, in the end, level with people that gas prices are at this level to stay and, if anything, they're going to go higher?

And isn't not to do so intellectual dishonesty?

Anybody?

RON PAUL: I'll be glad to answer that question,

because it's something I talk about all the time and it's a very important question.

The Wall Street Journal yesterday had a very good chart that explains this.

If you look at the price of oil in the last 10 years, if you look at it in terms of dollars, it went up 350 percent.

If you look at it in Euros, it went up about 200 percent.

If you look at it in the price of gold, it stayed flat.

It's the inflation, it's the printing of money, it's the destruction of the value of the dollar.

Added on to this, the notion that we go to protect "our" oil.

Oil was $27 when we went over there to get the oil and protect the oil and take the oil from Iraq.

There's less -- there's less than about half the production now in Iraq right now. And we're threatening Iran.

And that pushes prices up. It pushes up the concept of supply and demand.

But you can't deal with the price of oil without dealing with the supply and demand of dollars.

When you devalue the dollar -- and the dollar is going down every day.

And the further the dollar goes down, the higher the prices of oil are going up.

We have to understand that.