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The truth about today’s gas prices

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With gas prices hitting record highs on fairly regular basis, I find myself wondering two things:

  • Why is this happening?

and

  • When will it end?

Why is this happening?

The oil companies will tell you that its happening because demand is up and supply is down. Or they’ll tell you that its because the price per barrel is so high and that’s just what it costs to produce gasoline these days. Or they’ll tell you that its because they’ve had some major problems with their refineries and they just can’t keep up with the demand.

I say all of those “reasons” are crap! This is happening because the oil companies have discovered that Americans are actually willing to pay $3.25 or $3.50 for a gallon of gas and that they can make a ton of money that way. Yeah, we gripe and complain about the price, but when all is said and done, there we are again, right back at the gas pump with our wallets in our hands.

According to yahoo.com, Exxon-Mobile earned 36.13 BILLION dollars in profit in 2006. Think about that. Thirty-six billion dollars. A lot of company owners would give their eyeteeth to pull in one million dollars in a year. Exxon-Mobile made 36,000 TIMES that amount last year. That is roughly the equivalent of 11 dollars for every human being on the planet! That’s not just what they brought in… that’s PROFIT. That’s what was left AFTER they paid all the bills. Gravy.

Now, think about the fact that those numbers represent just ONE COMPANY. How many other oil companies are making equally obscene profits while you and I struggle to figure out how we’re going to come up with gasoline to get to and from work?

All that profit comes raining down on them and yet they can’t find the money to fix a few refineries. Can’t, or won’t? Why should they? If the refineries are all fixed and working 100% reliably and they build a few more of them then the supply goes up and the price goes down and the profits go down as well. Its much more profitable to rake in the cash and leave everything else as it is so they have exscuses to raise the prices even more.

Government regulation? It’ll never happen. In order for that to happen, Congress would have to pass a few laws and, as long as companies like Exxon are pulling down $3,000,000,000 per month (that’s $100,000,000 per day or $4,166,666.67 per hour) in profit they can afford to buy any politician they have to in order to keep the system working in their favor. Face it. Every man has his price and when you earn $1157.40 every second of every day, you can afford some pretty high-priced people.

My father once told me that the best price for anything is “all the market will stand”. The gas prices are so high because, frankly, we’re letting them get away with it.

They pretty much have us over a barrel (if you’ll pardon the pun) because, face it, what are we going to do? Quit driving? In today’s society that’s just not feasable. Do we start driving vehicles that don’t run on gasoline? Other than bicycles, which would be too slow given the distances that many of us travel to and from work, the only ones that don’t use gasoline have four legs, eat hay, and aren’t allowed to be kept in most metropolitan areas. Oh, those hybrid vehicles? First off, the term “hybrid” means that they still use gasoline and, therefore, are more of a carrot to try making people shut up about the problem than they are a solution.

Back in the 1970’s, during the last oil-company-manufactured gas shortage, I used to hear stories about how some guy or another had invented an engine that would run on water but the oil companies bought the plans and scrapped them. At the time I thought that was just a rumor someone started to make the oil companies look bad. Now, however, I’m not so sure. Take water and remove the Oxygen molecules. What’s left? Hydrogen. That’s what those wonderful hybrid engines run on. So, essentially, someone HAS invented an engine that can be fueled by water. But, strangely enough, the only way to buy it is in a model that ALSO uses gasoline… And, I don’t know about where you live, but at THIS end of the internet, there’s no place within 1,000 miles where I could fill a hydrogen fuel cell, so guess who gets the money from filling up those hybrid cars? Convenient, huh?

When will it end?

As I’ve hinted at already, no matter what the oil companies will whisper in you ear as they’re raping you, the pattern of higher and higher prices won’t change as long as Big Oil keeps getting what they’re after - your heard-earned paycheck.

On Friday of last week my local news station ran an article in which they claimed to debunk some myths regarding gas prices. One in particular was that gas prices rise for the weekend and go back down during the week. They managed to find a gas station manager willing to say this was not true. It’s not like he might have been biased or anything, oh no. I do know, however, that gas was $3.05 when I got up Friday morning and it was $3.09 during the late morning and afternoon, and by evening it was down to $3.04. If that’s not someone hiking the price to take advantage of weekend travellers, then what is it? I’m not going to be so crude as to actually name the station in question, but I will say that its owned by America’s largest retailer.

There have been a few email campaigns suggesting that we don’t buy gas on one particular day or from one particular company. These systems will never work. If I convince everyone in the country to not buy gas on Wednesday, then Americans will be divided into four groups:

  1. People who ignore me and do what they’re going to do anyway.
  2. People who weren’t going to buy gas on Wednesday anyway, so do what they were going to do anyway.
  3. People who buy gas on Tuesday instead of Wednesday.
  4. People who buy gas on Thursday instead of Wednesday.

The first two groups make no difference to anyone. The second two groups are still handing the same amount of money over, just on a different day. End result: No Difference.

As for not buying from one particular company, you’re again going to run into a large percentage of the population who does exactly what they were going to do anyway, regardless of your arguments or any promises they may have given just to shut you up. Those who do boycott the company in question will just be handing their money over to another oil company. It’s like saying you’re going to teach this shark a lesson by feeding your legs to that shark instead.

As for how to turn the tide on rising gas prices, I honestly have no solution to offer other than the same tired ones that people have been ignoring for decades:

  • Limit the amout of driving you do.
  • Carpool whenever possible. This will cut gas usage for that trip in half (or thirds, if you can drop two people on your way to wherever you’re going).
  • Don’t drive during rush hour. Heavy traffic reduces gas mileage as it increases road rage. Carpooling would also help to alleviate this problem.

Since I know everyone’s heard these suggestions a thousand times before and I’m living with the results of how much attention they’re paid, I’m going to shut up now and go to the gas station.

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