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Trying to make sense of gas prices



Published: Mon, January 17, 2011 @ 12:00 a.m.

Trying to make sense of gas prices

A recent Vindicator arti- cle addressed the issue of high gasoline prices. The reasons cited for the steep rise in the price of a gallon of gas are many and varied. None seem to make sense to this writer.

The American free enterprise system works on the law of supply and demand. The larger the supply of an item the cheaper the price. Higher demand brings a corresponding increase in an item’s worth. Gasoline seems to defy both those measures of cost.

We don’t hear of shortages in the supply of the crude oil from which gasoline is refined. And refineries haven’t caught fire lately, although that will happen as sure as little green apples. In fact many news stories I’ve read point to the fact that gasoline supplies are more than adequate. Demand did increase slightly over the holidays, but it still doesn’t explain the steady rise in gasoline prices beginning way back in the Spring of 2010.

Of course the oil companies and the marketing studies they pay for tell us speculators are driving the price up because the American economy is improving. For a select group of the wealthy that are also the speculators, I agree. For the working man who must buy the end product of this speculation, I disagree.

I have another theory on the surge in the price of gasoline and it’s purely political. Before the Democrats took control of Congress, the price of gasoline skyrocketed to $4 a gallon. As soon as the Democrats got control of both Congress and the White House the price of a barrel of oil plummeted and gasoline followed suit.

However, early this year when it became increasingly apparent that the Republicans, supported by these same wealthy speculators, would gain control of the U.S. government, the price of a barrel of crude oil began to climb “based upon speculation.” Speculation not on the improvement of the American economy but speculation that the Republicans would win control in November. Once the November elections confirmed the shift in control of Congress would fall to the right wing, suddenly gasoline prices began to soar to the over-$3-a-gallon price we pay today.

Coincidence? I don’t think so. Americans fell into the trap set by the right wing that the Democrats were failing the American people when in reality it was the stonewalling in Congress perpetuated by the right wing to again gain control of the U.S. government. As I write this letter the right wing is planning their moves to wrench both the White House from the Democrats and gain further control of the Congress in the 2012 elections.

The American people wanted change in 2008 and got it. But they didn’t allow the time needed for the changes to happen and they would not hold Congress accountable. The right wing continued to block any initiative to get the country going.

The electorate voted in November for change again. But was it the right thing to do? I predict that gasoline prices will continue to increase in 2012 and approach the $4 mark. Be careful what you wish for, you just might get it.

Tom Hall, Lisbon


Comments

11loaf(100 comments)posted 3 years, 7 months ago

Mr O is on record as saying the higher the price of gas the more likely people will support the search for alternative fuels.Is it possible he has conspired to drive the price of gas up?If he didn't I still bet it makes him happy.

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2farmforfun(15 comments)posted 3 years, 7 months ago

I'm so happy to see that the high price of gas was just a policital move from the right to reward the greedy and rich oil companies. For a breif moment I thought perhaps it had something to do with the declining value of the US dollar. Or even could be related somewhat to the fact that Oduma placed a moratorium on offshore oil drilling in the gulf. But then that wouldn't have anything to do with the price of gas. I'm sure the writer is correct it's a republican conspiracy. And its probably Sara Palins fault too.

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3Stan(9923 comments)posted 3 years, 7 months ago

We need to put a windfall profits tax on crude oil to stabilize these price swings and just keep the cost high .

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4Traveler(606 comments)posted 3 years, 7 months ago

We buy most of our oil to make gas from oversea. We pay for it in us dollar. Our government (both bush and obama) for the last 3 years we have been devaluing our money. The country that we buy our oil from our selling us the same amount of oil but now want more of our dollar. since through our economic policies we have made the dollar worth less.

We can blame both the democrats and republicans for this.

The democrats for the failure to recognize that we need to drill for oil in the US and that we cant just say no more gas powered car only electric from now on. (or what every the environmentalist happen to claim is going to save the world at the moment)

The republicans for there failure to understand that the oil company's cant be trusted to drill for oil safely with out oversight. That yes Americans want to buy gas made from US oil but before they let the oil company's go after it they want the government to make laws and regulation to keep the environment safe. That they expect the government to balance the environment against our need for oil.

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