Elaine Thompson, AP
The Truth Behind Soaring Gas Prices


Hikes are because oil companies are greedy, right? Or because of turmoil in the middle east?

Nope, real reason is much worse
^ ^ ^
Click above link to read why ?



.............The `End.......................

 

 

So it's the stock markets fault?

 

...Yes `Lou, it's the Market & people gambling on the future increases.....They are the ones that increase the price of a barrel of oil

The broker's makes billions & some of them are the one's we bailed `out....To me, it's outa control 4-Sure...They need to regulate...."The Rich get Richer & the Poor get Poorer"
To me, it's all about GREED...$'s...

It's a BAD System...Especially `if U R not Winning

 

Man i knew that there was a different factor effecting oil cost besides the "crisis"
I never knew that there was stock for oil. And it all makes sense with my knowledge of the stock market(My dad is crazy smart and is an active player in it and i began an interest) So does that make the oil companies greedy or the people to get some cash out of other's pain greedy.

 

I can't help but notice that everytime the news talks about rumors of gas prices going up, surprise surprise, gas prices go up within hours.

I honestly think gas stations think to themselves, "well people are expecting the price to go up to (insert amount here) per gallon anyway, I might as well do it and make more money."

 

what the guy was saying in the article that when people read about this its "fear driving these people to buy oil thinking its going to go up" which causes people, { speculator (The people who watch and buy and sell in a market)} to buy these contracts (Guarantee) in the future market hoping that the price continues to go up so they can make a buck. But at the end time of the contract the one who is holding has to sell this contract because he cant take librity of the contract(Ex. 100 barrels of oil for $$) because he is just an average joe. But the Hedger(Person who has the product) needs to buy the contracts back, so he floods the market with even more contracts which starts to bring down the price freaking out the joes making them sell the contracts. Lowering the price even more. Prices will always rise and fall.

But say we take the spectulater(like the guy is saying in the article) then what determins the price of the product? Well its all on the seller now. Because the gas stations have to buy the gas or they are out of business, so the seller can charge whatever. Then the gas station would charge even more to make a profit. Now if the Gas seller is reasonable and not greedy(lol) then prices will remain a stable moderate price...or most likely stay at a high. That will not work.

This isnt the best explenation and you should not quote me, do your on reaserch. And not information from someone actually involved. like this guy involved in gas. He's right to a point, but his solution would possible help him. If thats his intention or not.

I dont think i fully understand this concept, but the more i reaserch, the more i understand.

 

Hi `Jon, listen 2 the Wisdom of your Father 4-Sure.
Hope U R Enjoying your "Spring Break"
__________________________________________________ __
Five myths about gas prices

Paul Sakuma/ AP - Prices at a gas station in San Francisco, Calif. on March 9.

By Robert Rapier, Thursday, March 24, 2011

Gasoline prices have been steadily climbing for several months, and Americans are feeling the pain at the pump. The possible culprits (from greedy oil execs to Mideast turmoil) are as plentiful as the proposed solutions (more offshore drilling, green energy or government reserves). But what is really driving prices up? And what, if anything, can be done about it? Let’s take a moment to fill up on information about our fuel.



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• <LI sizcache="6" sizset="150">5 myths about gas prices
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1. Fighting in Libya is sending gas prices higher.
Libya is not a big enough global oil supplier for the battles there to have a meaningful effect on gas prices. In the 1970s and early 1980s, Libya was a major U.S. supplier, selling us around 700,000 barrels of oil per day. But today, we import less than 50,000 barrels per day from Libya — a tiny fraction of the 9.2 million barrels per day the United States imported in 2010. Worldwide, the story is no different: Of the 86 million barrels consumed globally each day, less than 2 percent come from Moammar Gaddafi’s regime.
So why are gas prices up? Though Gaddafi’s fate is largely irrelevant to the oil market, unrest throughout the greater Middle East is not. The Persian Gulf region produces almost 24 million barrels of oil per day, more than 25 percent of global oil consumption. The Arab spring that has brought protests to Egypt, Saudi Arabia, Bahrain and Yemen makes markets nervous, and when markets fret over a possible disruption to oil supplies, gas prices rise — whether the disruption materializes or not.




2. Tapping the Strategic Petroleum Reserve is a smart way to reduce gas prices.

The U.S. government maintains a 727 million-barrel oil reserve — 38 days’ worth at current levels of consumption — to protect against potential supply disruptions. But just about every time prices rise, politicians want to access the oil in the reserve to increase supply and bring prices back down. Sen. Charles Schumer (D-N.Y.), for instance, has been calling for oil releases from the SPR for more than a decade. In a letter to President Bill Clinton in 1999, he endorsed the release of several hundred thousand barrels a day from the SPR because, according to a news release about the letter, oil prices had made a “meteoric ascent to nearly $25 per barrel.”
Had Clinton dipped into the reserve then, as Schumer requested, we almost certainly would have gotten a raw deal. What if that $25-per-barrel oil could be replenished only at $75 per barrel? Tapping the SPR makes the government an oil speculator, and any nation running record deficits that becomes a commodity trader is playing a dangerous game.
The SPR exists to buy time in a true supply emergency. If we use it as a political tool to keep voters happy by stemming rising gas prices, we may be forced to buy back oil at even higher prices, or we may be left with an insufficient supply in a real crisis.

3. Oil companies produce less in the spring to make gas prices increase.
Almost every year, gasoline prices rise in the spring. At the same time, refineries produce less fuel. This isn’t because oil companies want to keep inventories low to drive prices higher. It’s because what’s in our gasoline — specifically, butane — changes from season to season.
Butane is a cheap ingredient in gasoline that boils at low temperatures. In winter, this isn’t a problem. But in summer, butane evaporates from gas, polluting the air while leaving us with less fuel in the tank than we paid for. As temperatures rise, refineries replace butane with more costly ingredients and draw down winter inventories just as beach season begins.
Chemistry, not corporate conspiracy, limits supply.

4. The Obama administration is driving up gas prices.
<A href="http://usactionnews.com/2011/03/mcconnell-accuses-obama-of-driving-up-gas-prices/">Sen. Mitch McConnell (R-Ky.) says EPA regulations are a “back-door national energy tax” that pushes prices up. Former Alaska governor Sarah Palin says the White House drilling moratorium shows President Obama’s “culpability in the high gas prices hurting Americans.”
Blaming the president for rising gas prices is nothing new, and it’s a bipartisan tactic. In 2004, Sen. John Kerry (D-Mass.) blamed President George W. Bush for higher gas prices and for continuing to fill the Strategic Petroleum Reserve as oil prices climbed.
Just one problem: Even if domestic supplies were developed, American presidents couldn’t really control oil prices. The U.S. government has estimated that there are 18 billion barrels of oil in the outer continental shelf of the lower 48 states that are off limits to development. That may sound like a lot, but it is only about 21 / 2 years of supply for the United States, and it would take several years to allocate leases and drill exploratory wells. Even if the estimated 10 billion barrels of oil in the Arctic National Wildlife Refuge were available for development, today’s policy decisions would have no impact on gasoline supplies for as much as a decade. Obama can’t dictate what you’ll pay for premium tomorrow.

5. Americans can’t live without cheap gas.
Yes, Americans love to drive, and Americans love cheap gas. But across an ocean, there’s a continent filled with people a lot like us who’ve lived with high gas prices for years. They’re called Europeans.
While U.S. gasoline heads toward $4 per gallon, Europeans have been paying much higher prices for years because of high taxes on fuel. This month in Britain, gas hit 6 pounds, or about $9.76, per gallon. Because gas is so dear, Europe’s per capita energy use is half that of the United States, leaving Europe less vulnerable to oil price shocks yet not undermining its citizens’ standard of living.
The United States, built on cheap oil, is much less densely populated than the Old World, with more wide-open spaces to traverse. But that doesn’t mean we can’t embrace some of the things that have helped Europeans keep their gasoline bills down — such as high-speed rail, public transportation and green energy.
In fact, Americans have shown that they can adjust their behavior when faced with sticker shock at the pump. As gas prices rose from $2.31 per gallon in 2005 to $3.30 per gallon in 2008, sales of the Toyota Prius eclipsed those of the Ford Explorer, and public transit use reached a 50-year high. When it costs $30 to fill up a Geo Metro with regular, all options are on the table.
Robert Rapier is the chief technology officer of Merica International, a privately-owned renewable energy company, and writes for Consumer Energy Report.
Read “Five myths about Gaddafi” and “Five myths about nuclear energy.”