Should Congress investigate the oil industry in relation to its pricing strategies?

Question

I am aware of the previous investigation which became a sham the moment they allowed Oil Executives to testify without being placed under oath.
I am aware of how supply and demand works and I do agree with the concept being a capitalist.
I do care how much the oil companies make in profit, again because I am a capitalist.
I do not believe we are being gouged, but are rather victims of price fixing by fiat.
The suplly and demand argument falls short at one basic point. Oil is not like that new tv or car you are thinking about buying. It is instead a necessary commodity for most. There is no fair pricing strategy in the oil industry because there is no real competition. If station A is selling gasoline for x amount station B across the street will be the same amount or within pennies. This allows for a situation where they don't have to collaborate with each other. One company sets a standard and others follow suit. The current price per barrel doesn't support the pump price.

Answer 1

That's a tough call.

On one side.. If oil is a "necessity" and thus not allowed to trade freely.. you'll soon find the same argument applied to the cars it fuels. And it will just snowball from there... until we end up with a Soviet style trade system which none of us want.

However.. on the other side.. they ( the oil companies ) are screwing us over.

It's a lose lose situation.

Answer 2

Add to the current price per barrel the amount of taxes that are slapped on to the oil industry to bring their product to us and see what happens.

Within each state the oil industry is required to pay state sales taxes, gross receipts taxes, underground storage tank taxes, federal excise tax, franchise tax, supplemental highway user tax,distributor tax.

Take into consideration that Counties, Municipalities can impose their own set of taxes.

Each State can add in special taxes uique to them. Look at just New York and Florida... New York has a spill tax of 0.3 cent per gallon is collected on gasoline and diesel and a petroleum testing fee of 0.05 cent per gallon is levied on gasoline. Florida has .2-cpg tax/fee for environmental inspection purposes (5 cents per barrel tax for the Water Quality Assurance Trust Fund, 80 cents per barrel for the Inland Protection Trust Fund, 2 cents per barrel for the Coastal Protection Trust Fund and 1/8 cents per gallon for weights and measures inspection fee).

Each of the taxes I mentioned increase or decrease on a yearly basis in line with the Consumer Price Index.

http://www.gaspricewatch.com/usgastaxes.asp

This is the most recent tax by state chart that I could find. Check it out...

http://www.energy.ca.gov/gasoline/statistics/gas_taxes_by_state_2002.html


It is amazing that we are not paying $5.00 a gallon.

We know that the oil industry are making profits. That is why they are in business though.

I doubt Congress will ever seriously investigate the oil industry. They may have to come up with acceptable reasons that their own home districts are gouging the oil companies who are in turn relaying those costs on to us the consumers.

Answer 3

The one thing that congress and all investigators seem to forget is "we are not stupid" Let see it cost more because they are paying more for oil. However, how come they are making more after cost PROFITS.

Answer 4

Oil companies must be subject to monitoring by the government in order to stop unfair prices due to conspiracy.

Answer 5

No, but they should stop subsidizing them.