What is the TRUE reason for?

Question

gas prices going up and up. They're going to be higher this weekend. I know the crude oil went up so that isn't the answer I want. I want to know WHY the crude oil is going up???

Answer 1

Some say Supply and Demand.

The world uses so much oil that when a country like China begins to industrialize it consumes greater quanitiies of Oil for energy...and has to compete with the US for these quanties...

But if you note the PROFITS are Historic.....

short article
http://www.consumeraffairs.com/news04/2005/oil_price_probe.html

This is the oil companies rational and explanation.
http://www.conocophillips.com/newsroom/other_resources/energyanswers/oil_profits.htm#Large_oil_company_profits

ou are welcome to believe them... i don't


greed is the real answers.....

once crude oil is bought refineries can collectively decided to lessen output or create a shortage however they can thus driving up prices........

this is what is done in california all the time

Answer 2

Prices are determined by futures traders. Some people sell oil futures, say, a contract to buy a million barrels of oil in one month. Let's say someone is selling future oil for $50 a barrel. Someone else might think, "Gee, I think a hurricane might wipe out some oil facilities, making it harder to get the oil to market, and raising demand, so I'll offer the seller $55 dollars a barrel, because I think oil will be more expensive a month from now." The seller will fill all the orders for the higher prices before the lower prices, so people that want future oil have to pay the going rate. Keep in mind that the oil buyers have no incentive to drive the price up: If they pay $55 a barrel for oil a month from now, and the daily price actually drops below that, they've lost money. World supply of oil isn't growing that fast, and demand is growing faster, thanks to China, et. al, so expect prices to stay high in the near future. Only more supply can bring the price down.

Answer 3

Because US government and some Mid-East countries reduced the crude oil production. The reserves of Iran is about to finish, and the reserves of the States will be end within 25 years. That's why...

Answer 4

There are alot of reasons. First among them is global tension. Lots of countries get jumpy when countries (read north korea) start testing new weapons. Afraid that they might be the target. And when people start getting jumpy they start getting afraid that they wont be able to get the fuel that they need. So demand goes up, and so does the price.

There is also the fact that it has happened so much that we now expect the price to go up when something like this happens. So now it is very likely it goes up when it really shouldnt, or goes up more than it should, merely because of greed.

"Everyone expects it to go up, well normally it might go up a dollar on the price of crude...lets raise it 2, no one will really notice, and we will make alot more money."

Answer 5

There's almost always more than one reason for things like this- complex issue, complex answer.

One reason-I think it is the same reason my husband and I got laid off on 11 Sept 2000... panic/anxiety.

There's a lot of political tension that is reflected by the high price we pay for fuel- Iraq is just one places the tension is visible...

Another- monopolies, and they're in two places in the route oil takes from the well to the pump.

OPEC (Organization of Petrolium-Exporting Countries- Algeria, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, United Arab Emirates, and Venezuela) is all about their own arses... their goal is to "determination of the best means for SAFEGUARDING THEIR INTERESTS, individually and collectively; devising ways and means of ensuring the stabilization of prices in international oil markets," blah, blah, blah.

A lot of these nations are not exactly our friends (Iran, Iraq...)- we (the US) have a relationship with them based on them provide us with petrolium... If it weren't for the oil, these relationships wouldn't be near as "strong"... Think about a drug addict's "friendship" with his dealer....

We all know that prices/barrel, affects our prices at the pumps and I suspect they are jacking barrel (& therefore pump) prices as high as consumers are willing to pay.

We bought gas when it was $1.75/gallon, and we are still buying gas, even now, when it's almost $3/gallon. And even if those prices are preventing us from going on that family road trip we've been planing since Christmas, we still have to get to work and back 5 times each week.

The second monopoly is here in the US- there's only 5 major fuel companies... I don't remember all of them right now. If Chevron jacks prices to $2.75/gal, then Conoco can get away with at least $2.72... then Tesoro will try $2.78, and so it goes.

If they are all sky-high, then us consumers don't have much choice in what we pay. I don't know if these companies are in kahoots, but it almost seems that way.

These are just my observations, hope it helps... I definitely understand your frustration, though!

Answer 6

OPEC is like a mafia . They are strong arming the country's of the world . I believe partially to the war . I know if there were people attacking north America . I would do the same given their position . Just keep in mind the more over population continues the more these will climb . The light at the end of the tunnel is they will need the food us produces . Back our farmers . We can get it back if we drastically increase exported food to those regions . Same thing they are doing .

Answer 7

Look at the world market. The US is not alone. The demands of China and India grow every day in regards for their need for crude as they develop at the rate they currently are. They are sucking it up, its more in demand, and prices go up. If you want to slow it down, quit buying anything manufactured in china. You are only exacerbating the problem.

Answer 8

futures investors are buying oil in advance then daisy chain to several pushing price up at each change(all on paper only)then sell inflated oil to the refineries that they own.and thus say they only make a reasonable profit
as long as you blame the government and not these speculators it will continue

Answer 9

Reason behind it is
1. Oil reserves are limited
2. they are going to finish in the coming 100 years
3. Demad has increased manifolds
These are main reason

Answer 10

There seems to be no logical reason for it, as far as I can see. Prices are just as high when Katrina hit as they are now with no apparent disaster or slow-down anywhere.

It seems to be more of a whim.