2006-11-05 09:51:13 · 4 answers · asked by Im-so-luved121 2 in Social Science ➔ Economics
You have identified your question as an economic one, so the answer must have something to do with supply and demand.
Through the 1990s, world oil prices were low, so few firms and countries spent money on oil exploration, building new oil wells, or refineries etc. Over the last few years, oil demand has grown strongly, largely because of strong economic growth in countries like China and India, where traditionally ther have been few cars, but this is changing rapidly as their populations become wealthier. This means that demand has grown strongly, while supply has been growing only slowly.
Once it became clear that demand was growing faster than supply and that this would be sustained, it was too late for new investment to expand supply. It can take several years to build find and develop new oil wells and refineries and all of the other things needed to produce 'gas'. If supply exceeds demand, then the price must go up.
In addition, conflict in the middle east and Africa (eg Nigeria) have also threatened the existing supply.
Looking ahead, high prices are providing a strong incentive for oil companies to increase production, so over time supply will also increase and prices will start to come back down.
See the link below for a graph of crude oil prices.
2006-11-05 13:03:04 · answer #1 · answered by eco101 3 · 0⤊ 0⤋
I'm guessing here that u r American as u use the word 'gas' If u think yr prices r high, jeez u wanna live here in the uk!! Your petrol is sooooo cheap compared to ours.
2006-11-05 18:00:31 · answer #2 · answered by english_rose10 3 · 0⤊ 0⤋
because the gas companies want to bilk us for every dime,nickel,or penny they can.so they can give their retired presidents 400 million dollar bonuses.
2006-11-05 17:59:45 · answer #3 · answered by forest lover 2 · 0⤊ 0⤋
don't you have a TV or read the paper? been alive lately
2006-11-05 17:54:09 · answer #4 · answered by Kitty 3 · 0⤊ 0⤋