I know: It's definitely not price gouging (insult away, BTW)

[alleyallen]

OK, gouging or not, it still doesn't address the problem, and that is it's getting too expensive to fill up. Not every one of us drives a gas-hog SUV. Some of us have reasonably fuel-efficient cars and don't drive wastefully or take unnecessary trips. I really don't use my car except to drive to and from work and to the store and back, with occasional trips to the city pool.

But public transportation isn't an option in our city (too small for that, too big to walk everywhere), I don't have the ability to develop my own electric car and there's little to nothing I personally can do to lower gas prices.

So while all of you argue the free-market system and supply and demand, I'm over here shelling out big bucks I can ill afford to spend to get to my job and see my son.

Let's keep our focus, shall we?

 

[The Big Ragu]

Here's what I don't get. There's increasing demand, and there is still a supply out there, if under the ground, but the oil-producing countries are seeing zero pressure to increase the supply being pumped into the market. When there have been problems before, the U.S. would put some pressure on Saudi Arabia and the rest of OPEC. Sometimes they wouldn't respond, or wouldn't give us what we want, but sometimes they'd increase their output.

So, why don't we have this now? Are the OPEC nations producing at full capacity? Or is it that there are people, here and/or abroad, making a lot of money who have no interest in seeing this happen?

Now, I know that's not a long-term solution, but it would help take some pressure off the market. Long-term, we need to push for alternative energy sources. And drilling in ANWR or off the Florida coast isn't the answer. That's GOP tripe tossed out to make their oil company supporters happy. Neither would produce enough oil to help things much, and it would take too long to get things going and get the oil on the market to make a difference anyway. But it would put a nice profit into the pockets of some oil execs.

Instead, we should be pushing to find ways to make cars more fuel efficient or, even better, run on alternative energy sources. We should be finding ways to make public transportation more efficient and widely available. We should be doing what we can to curtail the demand. Otherwise, we're stuck with a long-term problem.

Good post. This isn't 1974 when OPEC was having public meetings and deciding how much they were going to allow each country to pump, in order to drive up prices. But they do still restrain supply, even if it is a pretty weak cartel compared to what it was in the 70s. The Saudis have been amazingly flexible about allowing the other countries to cheat, but there have been some other factors that have weakened the cartel, too--the development of the Gulf of Mexico and the North Sea, being two biggies.

At this point, the problem is less a function of a good old-fashioned oligopoly--like OPEC--than it is that they can't pump the stuff and refine it fast enough to keep up with worldwide energy demands.

 

[Armchair_QB]

Here's what I don't get. There's increasing demand, and there is still a supply out there, if under the ground, but the oil-producing countries are seeing zero pressure to increase the supply being pumped into the market. When there have been problems before, the U.S. would put some pressure on Saudi Arabia and the rest of OPEC. Sometimes they wouldn't respond, or wouldn't give us what we want, but sometimes they'd increase their output.

So, why don't we have this now? Are the OPEC nations producing at full capacity? Or is it that there are people, here and/or abroad, making a lot of money who have no interest in seeing this happen?

Now, I know that's not a long-term solution, but it would help take some pressure off the market. Long-term, we need to push for alternative energy sources. And drilling in ANWR or off the Florida coast isn't the answer. That's GOP tripe tossed out to make their oil company supporters happy. Neither would produce enough oil to help things much, and it would take too long to get things going and get the oil on the market to make a difference anyway. But it would put a nice profit into the pockets of some oil execs.

Instead, we should be pushing to find ways to make cars more fuel efficient or, even better, run on alternative energy sources. We should be finding ways to make public transportation more efficient and widely available. We should be doing what we can to curtail the demand. Otherwise, we're stuck with a long-term problem.

But doing the things you talk about in your last graph won't change things immediately either.

 

[Pastor]

You all don't know deck about finances.

Those companies need to be making those kind of profits. Ever priced yachts, vacation villas and private jets? Those things don't come cheap.

Lay off.

Ace, you are spot on. Have you seen the price of gas lately? Those yachts, private jets and flights to their vacation villas are going up. It is all about keeping up with the same quality of life.

 

[MacDaddy]

OK, gouging or not, it still doesn't address the problem, and that is it's getting too expensive to fill up. Not every one of us drives a gas-hog SUV. Some of us have reasonably fuel-efficient cars and don't drive wastefully or take unnecessary trips. I really don't use my car except to drive to and from work and to the store and back, with occasional trips to the city pool.

But public transportation isn't an option in our city (too small for that, too big to walk everywhere), I don't have the ability to develop my own electric car and there's little to nothing I personally can do to lower gas prices.

So while all of you argue the free-market system and supply and demand, I'm over here shelling out big bucks I can ill afford to spend to get to my job and see my son.

Let's keep our focus, shall we?

OK.

Let's say someone drives 15,000 miles a year in a car that averages 20 miles per gallon. In my area, right now the average gas price is $3.05 per gallon. At that price it would cost $2,287.50 for a year's worth of gas. A year ago gas was $2.48 per gallon. That's $1,860 per year. A difference of $427.50 per year, or a bit more than an dollar a day.

 

[MacDaddy]

What is Exxon's profit margin?

If it was 10 percent before the price of oil started going through the roof and it's the same today, then I don't see what the problem is.

If the profit margin is a lot higher, then the red flags can be raised.

They might be making a lot more money, but they also might be spending a lot more money to make it.

The profit margin is leaps and bounds higher.

What is it, then?

Well, we have a slight, incremental increase in cars on the road. About the same amount of gas is being sold here over same time last year.

Yet pure profit went from $1.20 a share in Q2/2005 to $1.72 a share in Q2/2006.

Just a hunch, but there are probably a lot more variables than that.

 

[alleyallen]

OK, gouging or not, it still doesn't address the problem, and that is it's getting too expensive to fill up. Not every one of us drives a gas-hog SUV. Some of us have reasonably fuel-efficient cars and don't drive wastefully or take unnecessary trips. I really don't use my car except to drive to and from work and to the store and back, with occasional trips to the city pool.

But public transportation isn't an option in our city (too small for that, too big to walk everywhere), I don't have the ability to develop my own electric car and there's little to nothing I personally can do to lower gas prices.

So while all of you argue the free-market system and supply and demand, I'm over here shelling out big bucks I can ill afford to spend to get to my job and see my son.

Let's keep our focus, shall we?

OK.

Let's say someone drives 15,000 miles a year in a car that averages 20 miles per gallon. In my area, right now the average gas price is $3.05 per gallon. At that price it would cost $2,287.50 for a year's worth of gas. A year ago gas was $2.48 per gallon. That's $1,860 per year. A difference of $427.50 per year, or a bit more than an dollar a day.

Good math example. Problem is, gas ISN'T $2.48 a gallon. And until it is, all my efforts at trying to economize go for naught while everyone else debates free-market economies. Like that actually helps.

 

[Columbo]

What is Exxon's profit margin?

If it was 10 percent before the price of oil started going through the roof and it's the same today, then I don't see what the problem is.

If the profit margin is a lot higher, then the red flags can be raised.

They might be making a lot more money, but they also might be spending a lot more money to make it.

The profit margin is leaps and bounds higher.

What is it, then?

Well, we have a slight, incremental increase in cars on the road. About the same amount of gas is being sold here over same time last year.

Yet pure profit went from $1.20 a share in Q2/2005 to $1.72 a share in Q2/2006.

Just a hunch, but there are probably a lot more variables than that.

That's the essence of it.

 

[Columbo]

A serious question was posed that has gone unanswered:

Is there ever such thing as price-gouging?

 

[MacDaddy]

OK, gouging or not, it still doesn't address the problem, and that is it's getting too expensive to fill up. Not every one of us drives a gas-hog SUV. Some of us have reasonably fuel-efficient cars and don't drive wastefully or take unnecessary trips. I really don't use my car except to drive to and from work and to the store and back, with occasional trips to the city pool.

But public transportation isn't an option in our city (too small for that, too big to walk everywhere), I don't have the ability to develop my own electric car and there's little to nothing I personally can do to lower gas prices.

So while all of you argue the free-market system and supply and demand, I'm over here shelling out big bucks I can ill afford to spend to get to my job and see my son.

Let's keep our focus, shall we?

OK.

Let's say someone drives 15,000 miles a year in a car that averages 20 miles per gallon. In my area, right now the average gas price is $3.05 per gallon. At that price it would cost $2,287.50 for a year's worth of gas. A year ago gas was $2.48 per gallon. That's $1,860 per year. A difference of $427.50 per year, or a bit more than an dollar a day.

Good math example. Problem is, gas ISN'T $2.48 a gallon. And until it is, all my efforts at trying to economize go for naught while everyone else debates free-market economies. Like that actually helps.

I was just trying to point out that, despite price increases, the actual pocketbook impact is pretty minor.

Also, debating free-market economies is about as much help as what most people are doing about the problem -- complaining. As consumers, we have no control over what gas costs. We have control over how much we purchase.

 

[MacDaddy]

What is Exxon's profit margin?

If it was 10 percent before the price of oil started going through the roof and it's the same today, then I don't see what the problem is.

If the profit margin is a lot higher, then the red flags can be raised.

They might be making a lot more money, but they also might be spending a lot more money to make it.

The profit margin is leaps and bounds higher.

What is it, then?

Well, we have a slight, incremental increase in cars on the road. About the same amount of gas is being sold here over same time last year.

Yet pure profit went from $1.20 a share in Q2/2005 to $1.72 a share in Q2/2006.

Just a hunch, but there are probably a lot more variables than that.

That's the essence of it.

So you're arguing production costs are static?

 

[Columbo]

OK, gouging or not, it still doesn't address the problem, and that is it's getting too expensive to fill up. Not every one of us drives a gas-hog SUV. Some of us have reasonably fuel-efficient cars and don't drive wastefully or take unnecessary trips. I really don't use my car except to drive to and from work and to the store and back, with occasional trips to the city pool.

But public transportation isn't an option in our city (too small for that, too big to walk everywhere), I don't have the ability to develop my own electric car and there's little to nothing I personally can do to lower gas prices.

So while all of you argue the free-market system and supply and demand, I'm over here shelling out big bucks I can ill afford to spend to get to my job and see my son.

Let's keep our focus, shall we?

OK.

Let's say someone drives 15,000 miles a year in a car that averages 20 miles per gallon. In my area, right now the average gas price is $3.05 per gallon. At that price it would cost $2,287.50 for a year's worth of gas. A year ago gas was $2.48 per gallon. That's $1,860 per year. A difference of $427.50 per year, or a bit more than an dollar a day.

Good math example. Problem is, gas ISN'T $2.48 a gallon. And until it is, all my efforts at trying to economize go for naught while everyone else debates free-market economies. Like that actually helps.

I was just trying to point out that, despite price increases, the actual pocketbook impact is pretty minor.

Also, debating free-market economies is about as much help as what most people are doing about the problem -- complaining. As consumers, we have no control over what gas costs. We have control over how much we purchase.

Minimizing the impact of $1.20 a day coming out of your bank account is a little perilous.