Monday, January 10, 2005
Outrage vs. GasolinePrices
How come the gas companies are getting a free pass on gasoline prices now? Back when the prices first started spiking, people complained about gasoline taxes, or the price of crude oil rising from terrorism or just outright profiteering from the gas companies.
So what’s happened? The price of oil has remained constant for, what, a year now, and the Canadian Dollar has appreciated 10% compared to the price of oil. That means that for the same amount of money, I should be buying 10% more gasoline, right?
Then how come prices are hovering around $0.80 still?
The gas companies are profiteering.
I suppose they’re allowed: certainly if people are willing to pay that much for gas, they may as well sell it for that price. But what happened to the outrage? Are we limited to complaining once about something that is an injustice? Did we decide that it wasn’t an injustice after all?
¶ 10:53 AM
So what’s happened? The price of oil has remained constant for, what, a year now, and the Canadian Dollar has appreciated 10% compared to the price of oil. That means that for the same amount of money, I should be buying 10% more gasoline, right?
Then how come prices are hovering around $0.80 still?
The gas companies are profiteering.
I suppose they’re allowed: certainly if people are willing to pay that much for gas, they may as well sell it for that price. But what happened to the outrage? Are we limited to complaining once about something that is an injustice? Did we decide that it wasn’t an injustice after all?
¶ 10:53 AM
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I suspect that there's a lot more to it than that.
"For every complex problem there is an answer that is simple, neat, and wrong." -- H. L. Mencken
"For every complex problem there is an answer that is simple, neat, and wrong." -- H. L. Mencken
# posted by 
: January 23, 2005 at 4:16 PM
: January 23, 2005 at 4:16 PM
There's no collusion among the gas companies; there is some among the oil-producing nations, but mostly it comes down to simple supply and demand. As North Americans drive ever bigger vehicles which consume more gas, and the middle classes of India and China buy more and more cars (because they're finally rich enough to afford them), the demand for oil and gas grows. But, you just can't go out and dig a well and strike oil anywhere; there's a limited supply. So we all bid for it, and as more of us want it, the price rises.
To claim that the price of oil has remained constant "for a year" is to reveal that you never read the business pages of the newspaper or watch the market reports on TV; crude oil over the last year has been as high as US$50 and as low as US$38. Throw in the bouncing Canadian buck, and oil prices have yo-yo'ed all over the place.
Want proof? Well, across the river from Ottawa is Hull/Gatineau, where gasoline prices are set by the Quebec government, not the oil companies. Guess what? They pay about the same as Ottawa does.
J
To claim that the price of oil has remained constant "for a year" is to reveal that you never read the business pages of the newspaper or watch the market reports on TV; crude oil over the last year has been as high as US$50 and as low as US$38. Throw in the bouncing Canadian buck, and oil prices have yo-yo'ed all over the place.
Want proof? Well, across the river from Ottawa is Hull/Gatineau, where gasoline prices are set by the Quebec government, not the oil companies. Guess what? They pay about the same as Ottawa does.
J
# posted by : February 10, 2005 at 1:27 PM
: February 10, 2005 at 1:27 PM
Maybe facts vs. perceptions will be my next entry.
The point remains that oil has been expensive for a while now, and gasoline has been expensive for a while now. I understand the issues with the oil supply (I understand the bottle neck is delivery/refining, not reserves).
But if oil is expensive, then companies that rely on it as a raw resource should be feeling the pinch, not making record profits.
However, my MAIN point was... how come people were up in arms with billion dollar profits a couple years ago, and now silent about multi-billion dollar profits now?
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The point remains that oil has been expensive for a while now, and gasoline has been expensive for a while now. I understand the issues with the oil supply (I understand the bottle neck is delivery/refining, not reserves).
But if oil is expensive, then companies that rely on it as a raw resource should be feeling the pinch, not making record profits.
However, my MAIN point was... how come people were up in arms with billion dollar profits a couple years ago, and now silent about multi-billion dollar profits now?
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