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(11 Alive)   Oil companies in 2008: "Demand is up, so we've regretfully had to raise prices." In 2009: "Demand is down, so we've regretfully had to raise prices"   ( 11alive.com) divider line
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7146 clicks; posted to Main » on 20 May 2009 at 2:47 PM (9 years ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»

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2009-05-20 08:33:51 PM  

FZ6: But yeah - it's the evil people giving us gasoline to get to our jobs every day. Makes sense - let's regulate the hell out of them to a sick amount (to the fact that under the even more ridiculous carbon credit system, refineries are only going to be alloted 2% of the credits) to where they have to shut down and more American jobs are lost.

Those "evil people" you're talking about are making record profits on the backs of a lot of people and businesses who are having a very hard time making ends meet right now. At a time when things are economically on the ropes in this country, the oil companies are raping us because they know they can get away with it.
2009-05-20 08:34:21 PM  

CowboyNinjaD: Shadowknight: CowboyNinjaD: It's not his fault. He's just making the typical, cliche, anti-government argument.

Like people who argue against a national health care system by comparing it to the DMV. You know, I've been a licensed driver since 1996. I think I've only had to go an actual office two or three times. I went once to get my temporary license and another time to take my test and get my real license.

Then I moved to another state in 2003 and had to physically go to an office to get my picture taken for my new license. Other than that, everything has been through the mail or over the Internet.

So yeah, the DMV, a true model of inefficiency.

The DMV here in Virginia can be pretty atrocious, but I think it has more to do with the workers than the government involvement. They seem to hate the fact that their entire job is set up around giving everyone a hard time, pushing paperwork, and taking bad pictures while people blink.

But as you said, I can do almost everything online these days, once you're in the system, so it's not that painful anymore.

When I moved to Florida (the worst place in the world as far as Fark is concerned), they actually let me make an appointment to get my license changed over. So I show up, get my picture taken, take an eye exam and they hand me my new license. The whole thing took about 10 minutes.

I've moved several times within the state since then, and every time I need to get a new card or update my registration, I do it over the Internet.

I'm sure there are valid reasons for actually going into the DMV offices but I suspect that 90 percent of the people there are just old, foreign or stupid.

In Ohio, the only times I have to go the BMV are to either renew my driver's license or transfer my registration to a new car. They do allow address changes and registration renewals online. If Ohio allowed online renewal for driver licenses, I wouldn't have to go their offices at all, except to register a new car which is a rare occurrence for me.

But the Ohio BMV is amazingly efficient for a government operation. I can walk in, go up to the counter, give them my old license, take the eye test, pay the fee, sign a couple of papers, get my picture taken and walk out the door with my freshly minted license in under 15 minutes. They don't even make you fill out any forms. If only the rest of the government were as efficient.
2009-05-20 09:07:08 PM  

Dancin_In_Anson: lajimi: I don't much care for $4.00+ a gallon gas and these greedy bastiges jumping the price whenever they feel like it.

Then don't buy it.

I guess all of needs and foods arrive by some sort of magic fairy?
2009-05-20 09:07:50 PM  

SherKhan: fax

You're so right. Efficiency be damned!
2009-05-20 09:29:12 PM  
Translation: "Prices are down, so we've regretfully had to raise prices."
2009-05-20 09:49:01 PM  
Greenville,SC gas prices for regular on May 1st was $1.78 and now it is $2.19. Grab your lube and bend over....
2009-05-20 09:49:41 PM  

justtray: Also the Oil Companies aren't monopolies so much as oligopolies. There are very few of them. The problem then arises like it has that when they collude, it is bad for the economy. If they actually competed with one another, it may not be so bad.

Where's the conservative outrage over the free market? Oh yeah, I forgot, they cherry pick their free market support.

Plenty of outrage. But, what can you do? The Fed investigated the energy crisis in Ca. For six months and the result was, "free market at work, not enough supply," and closed the case. Another six months, Enron blows up and everybody has power again.

The Fed has investigated gas fixing numerous times and found nothing wrong. Yet, my buddy gets a call every morning for the last twenty years telling him what to sell his gas for or he doesn't get anymore.
2009-05-20 10:08:05 PM  

DIGITALgimpus: SherKhan: Whatever. Just let's not get distracted from weening ourselves off oil again. I'm looking at you Zombie Reagan.

Zombie Reagan sold out to opec before anyone even realized what was going on. Not his fault exactly. The Republican party since the 80's have been very much against moving away from oil since their base is heavily invested. Still is.

That said... gas prices always climb in the spring as they convert the refineries to produce summer grade gas. Happens in the late summer/ early fall again for winter grade gas season.

This does not happen in the PacNW any longer. We get "winter grade" E10 all year 'round now. However, even with the constant grade, our prices still fluctuate with the seasons. People historically drive more during the spring and summer months, so the gas companies are raising their prices to match the expected increase in demand. However, with the economy circling the drain, I think we'll see prices drop again soon as companies realize that demand falls off when people can no longer afford their product. People will be driving less this summer than last, due to only half of the population actually having a job.

/Has a job
//Will be driving more
///Looks forward to fewer people on the road this year
2009-05-20 10:32:45 PM  
Here we are in the "Worst economy in 50 years!!!" and oil prices are going up. Gonna be fun buying gas if/when the economy turns around.
2009-05-20 11:36:40 PM  
just wait until it hits the anus
2009-05-21 01:51:13 AM  
So many corporations with a strangle hold on your lives. But you'll keep fighting for them.
2009-05-21 09:29:05 AM  

TheShavingofOccam123: treat them like other utilities. regulate them and allow them a profit but no speculation and no price gouging.

That was how it used to be but somebody undid all the regulation. Oh now I see it was this.
Link (new window)
2009-05-21 10:04:37 AM  

Wizzin: Here we are in the "Worst economy in 50 years!!!" and oil prices are going up. Gonna be fun buying gas if/when the economy turns around.

1.) Buy a diesel car
2.) Fill with homemade biodiesel
3.) Profit

Cars are a luxury, not a right. This is like purchasing a big LCD TV but not wanting to pay for service or electricity. You want the convenience? Pay to play.
2009-05-21 11:26:35 AM  

Magics5RIP: Wizzin: Here we are in the "Worst economy in 50 years!!!" and oil prices are going up. Gonna be fun buying gas if/when the economy turns around.

1.) Buy a diesel car
2.) Fill with homemade biodiesel
3.) Profit

Cars are a luxury, not a right. This is like purchasing a big LCD TV but not wanting to pay for service or electricity. You want the convenience? Pay to play.

I'm not so sure about that. People being able to move great distances quickly is a pretty important part of our economy. The last thing that needs to happen now is to make it more expensive to go to work.
2009-05-21 11:46:54 AM  

justtray: justtray

The long answer is that just because price goes up and people buy less, that doesn't make a good elastic. You seem to completely have misunderstood what I wrote. Price goes up, but demand does not drop significantly because people still need or want the product, in this case need. They may drive less often, but they don't drop their consumption in the same way they would for another, more elastic good.

Yes gas is an INELASTIC good. To say anything otherwise is simply not correct. Please see the above paragraph if you still don't understand. I'm guessing you don't because you didn't the first time. It's ok, economics is hard, stupid people just can't understand it.

So in conclusion, YOU don't know what inelastic means, sadly.

When one is as uninformed as yourself, it is not a debate. It is me lecturing to a fool.

You spoke of inelasticity in terms of "demand". You misuse a term of art and then attempt to lecture another on econ. Whatever you say frkko.

You're stating that demand for gasoline has not dropped significantly since prices went up. Really? Seriously?

If you studied Econ at all (or ever) I'm guessing you did it years ago....back when economists believed that the quantity demanded for gas was in fact inelastic. Trends over the last three years have shown this is not the case.

Here's the deal from someone who actually has studied this stuff: Gasoline is one of the only goods that has both inelastic and elastic qualities. In the short term it is inelastic as people are tied to their quantity demanded via their cars, but long term it is quite elastic as consumers change their habits to conform with prices. You don't have to take my word for it. It's happening right now before your very eyes.

The source of your own confusion is your imprecise use of the language and lack of knowledge of which you speak. Also, you need to mix in a more up-to-date econ book.
2009-05-21 12:36:58 PM  

SherKhan: fax

You're so right. Efficiency be damned!

Bits and bytes aren't paper. He specifically said sheet of paper.
2009-05-21 02:02:05 PM  

Why do gasoline prices fluctuate?
Even when crude oil prices are stable, gasoline prices normally fluctuate due to factors such as seasonality and local retail station competition. Additionally, gasoline prices can change rapidly due to crude oil supply disruptions stemming from world events, or domestic problems such as refinery or pipeline outages.

Seasonality in the demand for gasoline - When crude oil prices are stable, retail gasoline prices tend to gradually rise before and during the summer, when people drive more, and fall in the winter. Good weather and vacations cause U.S. summer gasoline demand to average about 5 percent higher than during the rest of the year. If crude oil prices remain unchanged, gasoline prices would typically increase by 10-20 cents from January to the summer.

Changes in the cost of crude oil - Events in crude oil markets were a major factor in all but one of the five run-ups in gasoline prices between 1992 and 1997, according to the National Petroleum Council's study, U.S. Petroleum Supply - Inventory Dynamics. About 47 barrels of gasoline are produced from every 100 barrels of crude oil processed at U. S. refineries, with other refined products making up the remainder.

Crude oil prices are determined by worldwide supply and demand, with significant influence by the Organization of Petroleum Exporting Countries (OPEC). Since it was organized in 1960, OPEC has tried to keep world oil prices at its target level by setting an upper production limit on its members. OPEC has the potential to influence oil prices worldwide because its members possess such a great portion of the world's oil supply, accounting for about 40 percent of the world's production of crude oil and holding more than two-thirds of the world's estimated crude oil reserves. Additionally, increased demand for gasoline and other refined products in the United States and the rest of the world is also exerting upward pressure on crude oil prices.

Rapid gasoline price increases have occurred in response to crude oil shortages caused by, for example, the Arab oil embargo in 1973, the Iranian revolution in 1978, the Iran/Iraq war in 1980, and the Persian Gulf conflict in 1990. Gasoline price increases in recent years have been due in part to OPEC crude oil production cuts, turmoil in key oil producing countries, and problems with petroleum infrastructure (e.g., refineries and pipelines) within the United States. Additionally, increased demand for gasoline and other petroleum products in the United States and the rest of the world is also exerting upward pressure on prices.

Product supply/demand imbalances - If demand rises quickly or supply declines unexpectedly due to refinery production problems or lagging imports, gasoline inventories (stocks) may decline rapidly. When stocks are low and falling, some wholesalers become concerned that supplies may not be adequate over the short term and bid higher for available product. Such imbalances have occurred when a region has changed from one fuel type to another (e.g., to cleaner-burning gasoline) as refiners and marketers adjust to the new product. Gasoline may be less expensive in one summer when supplies are plentiful vs. another summer when they are not. These are normal price fluctuations, experienced in all commodity markets. However, prices of basic energy (gasoline, electricity, natural gas, heating oil) are generally more volatile than prices of other commodities. One reason is that consumers are limited in their ability to substitute between fuels when the price for gasoline, for example, fluctuates. So, while consumers can substitute readily between food products when relative prices shift, most do not have that option in fueling their vehicles.
2009-05-21 06:44:48 PM  

Bukharin: You are trying to suggest the USPS is a soviet boogyman

No I am saying that they are not a well run organization.

TheShavingofOccam123: regulate them and allow them a profit but no speculation and no price gouging.

Why? And just what is price gouging?

vabeard: I guess all of needs and foods arrive by some sort of magic fairy?

Dancin_In_Anson: Well, when gas was over $4 we changed a lot of things that reduced our expenses to offset the increase. Funny thing was we actually spent less when we started paying attention to the details of where the money was going.

In other words, we bought a lot less of the product. Try it sometime.
2009-05-21 09:29:58 PM  
Solution: Take bus, bike or share a car.

Gasoline prices will continue to rise forever, get used to the idea and get ahead by adjusting your habits now.
2009-05-21 09:31:05 PM  

lajimi: If demand stays the same the prices will jump. Maybe it's time to nationalize the oil industry.

/Back to over $4.00 a gallon by July.


/Wait what? I'm not sure how that will solve anything.
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