Tuesday, July 18, 2006
About a week and a half ago the price of oil jumped to over $75 per barrel. I remember reading an article that same day saying the price hike in crude would cause $3 per gallon gas prices at the pump. While I was driving home that same day I noticed the gas stations changing their prices to $3 a gallon reflect this increase. How in the hell is this possible?
From the time oil is sold until it becomes a refined product at the pump is almost three weeks or more. So how could this increase hit the pump so fast unless we were being gouged? I found only one gas station with the old price and they kept it until last Friday when they finally jumped with the rest of them.
The excuse for the price increase in oil to over $75 a barrel was increasing tension with Iran. This is insane!!! You mean I can charge somebody more for a product just in case it becomes scarcer in the future? Can you imagine charging more for a product for an event that might not ever happen? If the event never happens can I get my money back?
When the Congress investigated gas prices last fall they forgot to factor in the bullshit like this. They found nothing shady about the oil industry. The bullshit factor is when you raise prices in anticipation of a shortage. This should be an illegal practice. If there is a shortage then you can raise prices but you should never be allowed to raise prices for an inelastic good without an actual event.
By finding no wrong doing, the Congress is saying they can charge whatever they want and it’s perfectly legal. When the people got upset with these findings the economists defended the corporations. In the economists’ minds, you should be able to charge whatever price the market will hold regardless of its impact on society.
So in this case we have another example of corporate goals not being in alignment with the health and welfare of society; as well as, another example of collusion. All of the stations except one raise the price immediately even though they had not felt the impact of the higher price yet. The gas in their tanks was bought at the old price. And they all raised prices together even though they are supposed to be different companies.
From the time oil is sold until it becomes a refined product at the pump is almost three weeks or more. So how could this increase hit the pump so fast unless we were being gouged? I found only one gas station with the old price and they kept it until last Friday when they finally jumped with the rest of them.
The excuse for the price increase in oil to over $75 a barrel was increasing tension with Iran. This is insane!!! You mean I can charge somebody more for a product just in case it becomes scarcer in the future? Can you imagine charging more for a product for an event that might not ever happen? If the event never happens can I get my money back?
When the Congress investigated gas prices last fall they forgot to factor in the bullshit like this. They found nothing shady about the oil industry. The bullshit factor is when you raise prices in anticipation of a shortage. This should be an illegal practice. If there is a shortage then you can raise prices but you should never be allowed to raise prices for an inelastic good without an actual event.
By finding no wrong doing, the Congress is saying they can charge whatever they want and it’s perfectly legal. When the people got upset with these findings the economists defended the corporations. In the economists’ minds, you should be able to charge whatever price the market will hold regardless of its impact on society.
So in this case we have another example of corporate goals not being in alignment with the health and welfare of society; as well as, another example of collusion. All of the stations except one raise the price immediately even though they had not felt the impact of the higher price yet. The gas in their tanks was bought at the old price. And they all raised prices together even though they are supposed to be different companies.
posted by DarthImmortal at 2:32 PM
4 Comments:
I have to say, I place at least part of the blame for this one squarely on consumers. If Americans were seriously concerned about gas prices they would drive reasonable vehicles. Instead, they drive dangerous, ugly, bloated SUVs. There is very little in this world that I hate more than SUVs, bureaucrats, and politicians. If I could bundle them all into a heap stuck together with all the wadded-up gum from under restaurant tables, and launch them out into space, I would do it.
While it's true the gas corporations are evil, I hope that gas prices eventually rise to a point where people just get fed up and start demanding better efficiency. Let's wean ourselves from our dependence on foreign oil (note: this isn't going to happen simply by throwing more and more teenagers with guns at Iraq) and start taking positive action to use the natural resources we have in a responsible and effective manner. That means less waste, and less damage to the environment.
Of course, that would require an American public with an average brain size larger than a pea. Lol -- guess I shouldn't spend my time focused on pipe dreams...
Hellloooo? Our Presiden't family is in the OIL INDUSTRY! Is it really that much of a mystery?
Lawfairy,
Much of the blame should be on the idiot driving the double-axle diesel truck with no one except himself in it. When the truck pulls up next to you it sounds like it getting ready to launch into space. Usually the redneck driving has a cigarette hanging out the side of his mouth and a (completely useless) playboy air freshener hanging from the rear view mirror. I would like to put this guy on the voyage into space with the other idiots you already identified.
Barbarian,
LOL!! It's not much of a mystery at all but I have to complain to get it off my chest. Thanks for the comment.
darth,
I'll reserve him a seat, first-class.
:)
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