[QUOTE=ASAKMOTSD]
I notice that in the paper today it says that the refineries are “struggling” to keep up with the “increased demand” and that is the reason why the prices are spiking. OK, so if that is true, why is it that there are no signs reading “No Gas” anywhere to be seen? The only changes in the signage are the twice daily (upward) price changes.
[/QUOTE]
Because we have enough gas to go around. Long story short, as demand increases, prices increase. As higher prices, people aren’t going to buy as much. When demand starts to drop off, prices will decrease. This price information takes time (but not that much time) to be communicated back and forth in the market.
[QUOTE=mazinger_z]
Because we have enough gas to go around. Long story short, as demand increases, prices increase. As higher prices, people aren’t going to buy as much. When demand starts to drop off, prices will decrease. This price information takes time (but not that much time) to be communicated back and forth in the market.
[/QUOTE]
And the “struggling to keep up” part comes into this equation where exactly? :dubious:
[QUOTE=RTFirefly]
Gas has gone from $2.10/gal. back in January to about $3.00/gal. now, a 43% bump. That’s a big enough increase that if its distribution is lopsided, it can alter the underlying pie chart substantially.
Now take your pie chart. Taxes, it says, are 20% of the cost of gasoline in the U.S. Let’s say that’s assuming $2.50/gallon gasoline, which would mean an average of 50¢/gallon in taxes. Since the taxes are fixed while prices fluctuate, that means taxes would go from 24% of $2.10 gas, to 17% of $3 gas.
And look at the price of crude, which is about $61/barrel currently for light crude. My Googling hasn’t turned up any week-by-week tracker of that price, so I don’t know how low it got this winter, but I don’t believe it dropped below $50/barrel. (Let me know if I’m wrong.) Again, let’s assume $2.50 gasoline is the benchmark for your pie chart, which has crude at 59% of the pie. Let’s further assume that that percentage was based on $55/barrel crude.
At $50/barrel and $2.10/gallon, that would become 64% of the cost of a gallon. But at $61/barrel and $3/gallon, it’s down to 55% of the cost.
So crude and taxes apparently went from 88% of the cost at $2.10/barrel, to 72% at $3/barrel. The total share of everything else - refining, distribution, and marketing - presumably went from 12% of $2.10/gallon to 28% of $3/gallon, a difference of nearly 60¢/gallon. If my assumptions and arithmetic are correct, that’s a pretty serious swing.
My main point here is that that pie chart is, at best, an average, but that you can and probably do get a very different pie chart at different times of the year. There’s a lot of gallons of gasoline sold in the U.S. each year. And the changes in the pie chart show who stands to rake in the bucks, and who doesn’t, when the price goes up. Whether it’s a conspiracy or just a seasonal windfall, the first step in figuring out whether a conspiracy even makes sense is to determine who the winners and losers are.
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That makes sense to me, and it does appear that the percentage of cost of crude oil in the pie chart has changed:
[QUOTE=lowbrass]
You mean you’ve never heard the theory of supply and demand?
[/QUOTE]
And this relates HOW to my question? The point I made earlier (scroll up) is that the news is reporting that refineries are struggling to keep up and yet I see no signs saying “No Gas”. The only changes to the signage I see are the twice daily increases in price. The implication I am making here is that this is not a SUPPLY issue - this is a GREED issue…
[QUOTE=ASAKMOTSD]
And this relates HOW to my question? The point I made earlier (scroll up) is that the news is reporting that refineries are struggling to keep up and yet I see no signs saying “No Gas”. The only changes to the signage I see are the twice daily increases in price. The implication I am making here is that this is not a SUPPLY issue - this is a GREED issue…
Are we on the same page now?
[/QUOTE]
Relax, guy - I was agreeing with you. It was a joke, like I wrote “supply” really small because it would appear not to be part of the equation. Doesn’t your browser show the different font sizes?
[QUOTE=ASAKMOTSD]
And this relates HOW to my question? The point I made earlier (scroll up) is that the news is reporting that refineries are struggling to keep up and yet I see no signs saying “No Gas”. The only changes to the signage I see are the twice daily increases in price. The implication I am making here is that this is not a SUPPLY issue - this is a GREED issue…
Are we on the same page now?
[/QUOTE]
Struggling to keep up and not keeping up are two different things.
Incidentally, when prices go high demand is reduced, which means that the high price of gas right now makes it incredibly unlikely that you will see a sign that says no gas for the foreseeable future. Of course, keep in mind that a reduction in demand will have to be pretty substantial to cause prices to drop appreciably.
[QUOTE=Airman Doors, USAF]
Struggling to keep up and not keeping up are two different things.
Incidentally, when prices go high demand is reduced, which means that the high price of gas right now makes it incredibly unlikely that you will see a sign that says no gas for the foreseeable future. Of course, keep in mind that a reduction in demand will have to be pretty substantial to cause prices to drop appreciably.
[/QUOTE]
But in theory, would you agree that, at least in some cases, it is possible for unscrupulous companies to manipulate markets to their advantage? Would you agree that power companies did this a few years back?
[And remember that very similar “supply and demand” and “free market” arguments were used at the time to defend their actions.]
[QUOTE=mazinger_z]
Because we have enough gas to go around. Long story short, as demand increases, prices increase. As higher prices, people aren’t going to buy as much. When demand starts to drop off, prices will decrease. This price information takes time (but not that much time) to be communicated back and forth in the market.
[/QUOTE]
No time at all, in my experience.
The first time prices ramped up past $3.00 about a year ago, give or take a few months, my drive to work got real easy very suddenly. I have no idea where all these people had been driving in the days before that they suddenly didn’t need to go, but traffic was decimated.
the local prices dropped about 20 cents by the end of the second day.
[QUOTE=ASAKMOTSD]
And this relates HOW to my question? The point I made earlier (scroll up) is that the news is reporting that refineries are struggling to keep up and yet I see no signs saying “No Gas”. The only changes to the signage I see are the twice daily increases in price. The implication I am making here is that this is not a SUPPLY issue - this is a GREED issue…
[/QUOTE]
Have you, perhaps, noticed that the price of gas has started to rise? You aren’t going to see signs saying ‘No Gas’ because refineries are struggling to keep up with demand…instead you are going to see a rise in the PRICE AT THE FUCKING PUMP. Have you, perhaps, noted such an rise? Have you, by chance, noted a rise in the price of oil per barrel as well recently?
This is really getting tedious here. Its been explained, repeatedly…and people are still fixated on the supposed greed of Big Oil™.
[QUOTE=lowbrass]
But in theory, would you agree that, at least in some cases, it is possible for unscrupulous companies to manipulate markets to their advantage? Would you agree that power companies did this a few years back?
[/QUOTE]
Have you seen anybody deny that there is the possibility that markets are being manipulated? All we are asking is that, if you believe it is happening, you substantiate the claim with real numbers and real proof. “Can’t you see?” and “Look at the profits they’re making!” are not reasons. It has been amply explained why the companies are turning in record profits, and yet somehow that evidence is ignored in favor of some unsubstantiated price-gouging conspiracy theory.
Have you, perhaps, noticed that the price of gas has started to rise? You aren’t going to see signs saying ‘No Gas’ because refineries are struggling to keep up with demand…instead you are going to see a rise in the PRICE AT THE FUCKING PUMP. Have you, perhaps, noted such an rise? Have you, by chance, noted a rise in the price of oil per barrel as well recently?
This is really getting tedious here. Its been explained, repeatedly…and people are still fixated on the supposed greed of Big Oil™.
-XT
[/QUOTE]
Extreme Sigh Scroll up further to see the constant debate other have engaged on your posts. I am not feeding you further.
[QUOTE=lowbrass]
But in theory, would you agree that, at least in some cases, it is possible for unscrupulous companies to manipulate markets to their advantage? Would you agree that power companies did this a few years back?
[And remember that very similar “supply and demand” and “free market” arguments were used at the time to defend their actions.]
[/QUOTE]
Perhaps. Give me some concrete examples and we can talk.
[QUOTE=lowbrass]
I didn’t say anyone denied that. I was asking you if you agree with me on it. Am I not allowed to ask you questions?
[/quote]
Sure you are. As am I.
It’s entirely possible that Bigfoot may exist. It’s entirely possible that Dick Cheney blew up the World Trade Center. However, it’s up to you to make your case. You’re the one making the allegations. Prove it.
It’s entirely possible that Bigfoot may exist. It’s entirely possible that Dick Cheney blew up the World Trade Center.
[/QUOTE]
Well this is what I was trying to get at. Do you assign the same probability to markets being manipulated as you do to the existence of Bigfoot? Because I don’t. I believe it has happened in the past (I believe that Enron did it, for one), whereas I do not believe that Bigfoot exists, nor do I believe that Dick Cheney blew up the WTC.
[QUOTE=Airman Doors, USAF]
It has been amply explained why the companies are turning in record profits
[/QUOTE]
Not really. NBC made some convincing arguments, but he admitted he would have to research it further. Most of the rest of you have just engaged in libertarian hand-waving about the vaguaries of “supply and demand”. Just saying the price of crude has gone up doesn’t account for the record prices and record profits, as has been amply pointed out here, EVEN when we account for the profit margin being maintained. And mentioning over and over that the government adds to the cost doesn’t make the case for a necessary price increase, unless one shows that these costs have increased. Not just that they exist, but that they have increased enough to justify the price increase.
C’est la vie…some ignorance can not be fought (one has but to note lowbrass among others in this thread).