Can anyone tell me why gas prices are so freekin high?

Question

Why is it that when gas prices are decreasing, they go down like 2 cents a week but when they are increasing, it goes up 20 cents every 3 days. When are we going to switch to some alternative fuel and stop relying on petroleum? What ever happened to hydro power. And please don't blame the cost per barrel because I heard that the US has about a 6 month supply of oil so gas shouldn't go up so quickly just because the cost per barrel went up.

Answer 1

High demand over a stagnating supply. As countries like China and India begin to loosen their economic regulations, they are demanding more and more oil. That of course is just one example, but the logical answer to meet that increasing demand would be to increase the supply. However, when there is pressure from people with something to gain financially or in the way of self-gratification (i.e. Al Gore, Hillary Clinton, and other alternative fuel proponents), increasing the supply is frowned upon. There is more than enough oil on earth to satisfy our needs for a long time (in fact it will never run out, but that discussion is for another day). However, when people like Hillary complain about drilling for oil in some obscure part of the world which no human occupies, the supply is left unchanged and the demand increases thus creating a higher price. Furthermore, alternative fuels will be used in the future, but the reason they haven't been yet is because they are too expensive. Once they become cheaper than oil, you'll see them begin to be implemented. Considering that hasn't happened yet, oil is still the cheapest and therefore we're will continue to use it.

It's important to not be fooled into thinking throwing money at alternative fuels will get them to market at a lower cost any sooner. Allowing the private sector to come up with a cheaper form of energy will allow it to be brought to market with a higher amount of quality because someone has their own money invested in the project and not the government's.

Another important thing to consider is that compared to years past, oil prices have risen nominally, but not by all that much in real terms. In other words, the actually physical number we consider the price may have risen (i.e. from $1.00 6 years ago to $2.59 today), but when adjusted for inflation, the actual increase compared to the price of oil in real terms in say 1973, seems to be relatively small.

Answer 2

I'm not so sure gas prices are really 'high". Consider this:

A gallon of milk (a renewable resource): $2.50-3.00/gal

A liter of bottled water (a renewable resource): $1-3.00 which is about $10/gallon.

A gallon of gasoline, refined from crude oil (a NON-renewable resource): $1.54/gal ...pretty darn cheap by comparison.

..but you are paying $2.50-$3/gal? Well, figure that about $0.75 of what you pay is fed and state tax. The rest goes to transportation to the station plus profit for the guy who runs the station.

In Europe gasoline goes for more than $5/gal - more than $3 of that is government tax. A great way to reduce consumption and go green, I might add.

Answer 3

There are valid alternatives like hydrogen or LPG but the oil companies have Bush in their pockets and so we are led to believe there are no alternatives.

Petrol prices in the UK are twice what you pay in the US but we drive smaller cars and use them less. Maybe you should change cars.

Answer 4

The short simple answer......taxes and regulation. Gasoline is taxed at a federal and state level in most places. Each state also has different EPA guidlines.

Answer 5

Republican administration.
I agree. I spend alot of money on gas. it is to the point where I actually watch where I go and always look for the shortest route or find a closer store.
2009 will be a better time for the normal consumer.

Answer 6

yOu see, fuel is made from ice that is put through lemon juice, and since there has been a series of lemon robberies, the prices get higher because there are just not enough lemons left in this world!

DONT STEAL LEMONS!

Answer 7

You want an economy based on alternative fuels??? Should have elected Al Gore 7 years ago instead of big oil's nephew.

Answer 8

I believe a little man somewhere out in Washington DC sits at his desk and decides what the oil prices are going to be. The higher the more money he makes.

Answer 9

Go overseas and pay for fuel, then come back here and ask your whiny question if you can.