Gas Prices Jump...WHY?

[coolluke]

I saw $4.17 last night as well $3.83 This AM

 

[a.bentonab]

I've heard from a couple different sources that crude oil prices do not correlate nearly as well to gas prices as we would think.

The main problem with this is that the benchmark by which the price of oil is reported is based on oil from Cushing OK.

It would be absurd to report the thousands of different prices that oil trades on so this one is the "standard." Well it turns out that it isn't a very good standard.

Just because X oil rich nation is being bombed this week doesn't affect the availability of oil in Cushing OK, especially if different factors are involved such as a glut of oil in OK or who knows what else. On the other hand, "oil prices" could jump say if a pipeline to Cushing were to be disrupted, even though it wouldn't affect the global price of oil all that much.

SO back to the OP's question as to why gas is increasing while oil isn't, the "price of oil" as reported may not be a great metric for that. By other means it is a reasonable time to raise oil/gas prices as summer is approaching and several oil rich countries are currently being bombed. Many of the ones that aren't are dealing with the type of political unrest that would overwhelm INGO's servers many times over. There is still plenty of concern on off shore drilling although I think I heard the actual moratorium is over. Although the "price" of oil wouldn't indicate it, current events more than support a rise in gas/oil prices.

Heres the first article I found on it if you want to do some reading

The Absurd Report » Why Crude Oil Prices Are Now Above $100/Barrel By Jim Bianco

 

[localone]

we need to charge the middle east the same price for a bale of wheat that there charging us for a barrel of oil.......I bet there price per barrel goes down FAST

 

[BumpShadow]

I've heard from a couple different sources that crude oil prices do not correlate nearly as well to gas prices as we would think.

The main problem with this is that the benchmark by which the price of oil is reported is based on oil from Cushing OK.

It would be absurd to report the thousands of different prices that oil trades on so this one is the "standard." Well it turns out that it isn't a very good standard.

Just because X oil rich nation is being bombed this week doesn't affect the availability of oil in Cushing OK, especially if different factors are involved such as a glut of oil in OK or who knows what else. On the other hand, "oil prices" could jump say if a pipeline to Cushing were to be disrupted, even though it wouldn't affect the global price of oil all that much.

SO back to the OP's question as to why gas is increasing while oil isn't, the "price of oil" as reported may not be a great metric for that. By other means it is a reasonable time to raise oil/gas prices as summer is approaching and several oil rich countries are currently being bombed. Many of the ones that aren't are dealing with the type of political unrest that would overwhelm INGO's servers many times over. There is still plenty of concern on off shore drilling although I think I heard the actual moratorium is over. Although the "price" of oil wouldn't indicate it, current events more than support a rise in gas/oil prices.

Heres the first article I found on it if you want to do some reading

The Absurd Report » Why Crude Oil Prices Are Now Above $100/Barrel By Jim Bianco

Good post. However the price of gasoline is up for the same reason it's been going up for years, suppy and demand. Here's an article explaining it a little bit.

For those to lazy to read the article, in short it is because:

1) China and india are ramping up their economies and need more gas, either of which dwarf the US demand.

2) People driving gas hogs

3) People driving more.

Also, Obama is using high gas prices to push various measures, some good, some bad.

 

[semperfi211]

Energy in America: EPA Rules Force Shell to Abandon Oil Drilling Plans - FoxNews.com
The EPA may help a little.

 

[Goosepond Monster]

In case you couldn't tell, that was 100% sarcasm. I see those emails quite a bit. How does boycotting gas stations on Friday do a damn bit of good if everyone just buys it on Thursday or Saturday? Unless that boycott is coupled with a boycott on all driving that day, boycotting the stations is 1000% useless.

Everybody should Br happy that Ellis Wyatt doesn't own the oil companies.

I knew it was sarcasm. Like you I don't see the point of not buying gas on a certain day.

Whenever I see something like that I always say that if someone really wants to make a difference they need to walk, bike, take the bus, carpool or use some other form of alternative transportation.

I truly believe a lot of the folks out there think that if a bunch of them don't buy gas for a day it will actually make a difference. I guess I am making a huge difference because I haven't bought gas since Sunday.

 

[mrjarrell]

I buy gas once a week, so I am essentially boycotting my preferred gas station six days of the week. It's had no effect on them or their pricing. Unless you're willing to completely forgo gasoline it has, as hornadylnl points out, zero effect on them.

 

[Fletch]

It's because oil is traded as a commodity, this wasn't always the case. One of Bush's Rino moves.

Buh? Oil was traded on commodities market long before any Bush took the presidency. And what has that got to do with anything? Commodities trading performs an essential function in the market, by transferring risk away from producers and mediating fluctuations in supply and storage.

 

[right winger]

QE 2 devalues the dollar so more are needed to buy crude.
Obama and the EPA have their boot on the necks of the oil companies.
Not letting oil companies to drill for new oil.
Obama's moratorium on Gulf oil drilling.
Need I say more?

 

[85t5mcss]

How about one large monopoly umbrella? Lots of oil guys in there that all work together knowing that we have come to rely on it and they can bend us over backwards. After all, where else u gonna buy gas? One of their buddies. Ethanol, Gasoline, Diesel...Its all the same story.
(*)

 

[Bunnykid68]

It was still 3.85 in Evansville this morning

 

[goinggreyfast]

Also, Obama is using high gas prices to push various measures, some good, some bad.

Check this video:

http://www.youtube.com/watch?feature=player_embedded&v=qKdScVerrBU

Yet again hypocrisy at it's best.

 

[turnandshoot4]

Didn't we drill in Alaska to save money at the pump?

 

[goinggreyfast]

Didn't we drill in Alaska to save money at the pump?

Just had to repost this:

Once upon a time the government had a vast scrap yard in the middle of a desert. Congress said, "someone may steal from it at night." So they created a night watchman position and hired a person for the job.

Then Congress said, "how does the watchman do his job without instruction?" So they created a planning department and hired two people, one person to write the instructions, and one person to do
time studies.

Then Congress said, "how will we know the night watchman is doing the tasks correctly?" So they created a Quality Control department and hired two people. One to do the studies and one to write the reports.

Then Congress said, "How are these people going to get paid?" So they created the following positions, a time keeper, and a payroll officer, then hired two people.

Then Congress said, "who will be accountable for all of these people?" So they created an administrative section and hired three people, an Administrative Officer, Assistant Administrative Officer, and a Legal
Secretary.

Then Congress said, "we have had this command in operation for one year and we are $18,000 over budget, we must cutback overall cost."

So they laid off the night watchman.

NOW slowly, let it sink in.

Quietly, we go like sheep to slaughter.

Does anybody remember the reason given for the establishment of the DEPARTMENT OF ENERGY.... during the Carter Administration?

Didn't think so!

Bottom line. We've spent several hundred billion dollars in support of an agency...the reason for which most people who reads this can remember!

It was very simple...and at the time, everybody thought it very appropriate.

The Department of Energy was instituted on 8-04-1977 TO LESSEN OUR DEPENDENCE ON FOREIGN OIL.

AND NOW IT'S 2011 – 33.5 YEARS LATER -- AND THE BUDGET FOR THIS "NECESSARY" DEPARTMENT IS AT $24.2 BILLION A YEAR. THEY HAVE 16,000 FEDERAL EMPLOYEES AND APPROXIMATELY 100,000 CONTRACT EMPLOYEES; AND LOOK AT THE JOB THEY HAVE DONE! THIS IS WHERE YOU SLAP YOUR FOREHEAD AND SAY, "WHAT WAS I THINKING?"

Ah, yes -- good ol' beaurocracy.

AND, NOW, WE ARE GOING TO TURN THE BANKING SYSTEM, HEALTH CARE, AND THE AUTO INDUSTRY OVER TO THE SAME GOVERNMENT BOZOS? HELLOOO! Anybody home

 

[85t5mcss]

No matter how many times I read that, it still makes me laugh. As a country we are so unbelievably dumb. We need a thorough cleansing.

 

[goinggreyfast]

No matter how many times I read that, it still makes me laugh. As a country we are so unbelievably dumb. We need a thorough cleansing.

Did you catch the video link I posted earlier? It's at the top of this page.

 

[firehawk1]

What I would like an answer to is this,

Let's say there are 3 gas stations, Moe's Gas, Larry's Gas, and Curly's Gas. All have full tanks, and all are charging $3.00/gallon.

Moe sells out faster and has a load of gasoline delivered. It is slightly more expensive so he "need's" to charge $3.50/gallon. Larry and Curly STILL have gasoline that they are completly happy to sell at $3.00/gallon UNTIL they see Moe is getting $3.50/gallon. So... they raise their prices to match Moe's.

Isn't this just blantent price gouging? What ever happened to the gas wars we used to see? Where does the "gas retailers assoc." or whatever they're called fit into this?

I would guess to say IF I was a bizillionare and wanted to sell gasoline for ONLY the taxes that need to be collected on it I would be shut down. IMO the gas retailer assoc. OR whomever would claim unfair business practices, or some s**t like that.

What a monopoly/scam.

 

[hornadylnl]

What I would like an answer to is this,

Let's say there are 3 gas stations, Moe's Gas, Larry's Gas, and Curly's Gas. All have full tanks, and all are charging $3.00/gallon.

Moe sells out faster and has a load of gasoline delivered. It is slightly more expensive so he "need's" to charge $3.50/gallon. Larry and Curly STILL have gasoline that they are completly happy to sell at $3.00/gallon UNTIL they see Moe is getting $3.50/gallon. So... they raise their prices to match Moe's.

Isn't this just blantent price gouging? What ever happened to the gas wars we used to see? Where does the "gas retailers assoc." or whatever they're called fit into this?

I would guess to say IF I was a bizillionare and wanted to sell gasoline for ONLY the taxes that need to be collected on it I would be shut down. IMO the gas retailer assoc. OR whomever would claim unfair business practices, or some s**t like that.

What a monopoly/scam.

Did the people before the 1900's say the same thing about the prices of oats?

 

[firehawk1]

Did the people before the 1900's say the same thing about the prices of oats?

Uh... don't know, I'm only 54. besides, some if not most could grow their OWN oats.

This kind of crap didn't happen back in the '70's (when I came of age and started paying attention to things). There was competition between gas stations for your business. What happened?

First, there is NO shortage of oil. The world is litterally SWIMMING in oil. The oil companies are finding HUGE deposits almost every day it seems. Hell the Saudi's said they would be fine with $40/bbl oil.

There is no reason for oil/gas to be anywhere near the price it is now other than greed/rabid enviormentalists, oh and George Soros hell bent on destroying the US dollar/economy. Don't get me started on the speculator angle....

Here in Indy we haven't seen the spike in prices yet from the stupid "race crowd". Personally I wish they would bulldoze the track and put something there of more value anyway.

 

[85t5mcss]

Did you catch the video link I posted earlier? It's at the top of this page.

1 word INSANE