I filled up on Friday, and gas was $1.85/gal for 87 Octane. By Sunday, if not sooner, it jumped to $1.95/gal as the low! C’mon, like our own (USA) refineries and local owner/operators aren’t raking us over the coals? Why isn’t more being done by our local officials to guard against price gouging? (At least, why don’t we HEAR about mroe being done?)
Also, you cannot tell me within a stretch, the owner/operators are not price fixing? How magically NOW are all their prices are exactly the same???
Not sure if there’s any price gouging (or at least if there’s more than usual), but here’s a helpful site: Gas Buddy. On it, you can locate the service station near you with the lowest prices. Might help you determine whether you’re being gouged or not.
The current shortage might be short-lived, so one would hope that gas prices fall when OPEC members raise their production levels. If motorists don’t see a corresponding drop in prices when they refuel their vehicles, then Big Oil becomes an attractive target for their complaints.
There’s no “price gouging” going on. In a free market system, prices are strictly determined by supply and demand.
Gas companies are allowed to charge whatever they want for a gallon of gas. And they should be allowed to charge whatever they want for a gallon of gas. This will minimize gas shortages and inventory costs.
Individually, sure. But I think the OP thinks that the competing companies are getting together and colluding to hike prices - which I don’t believe they can do.
Anyway, since a barrel of oil costs about the same for everyone and I can’t imagine there’s much difference in refinery costs, it makes perfect sense that they would all have about the same price increase at the same time.
Collusion is a serious crime. “Extraordinary claims demand extraordinary proof.” If anyone has evidence collusion is occurring, I’d sure love to see it.
It is a very unusual situation, given that extremely little is actually going on to cause such a steep climb in the price of oil.
Every points fingers, but obviously there’s some lying going on. E.g., the Saudis claim that there is inadequate US refinery capacity. But that in no way affects oil going over $41 a barrel. (If anything, that should mean the US can’t buy as much as oil as it needs and prices should fall.) So you know they are lying.
As to US refinery capacity, the statements being made are indistinguishable from those made during the Great California Power Scam (by people in the same industry). So no one knows what’s going on now in this regard for sure.
As far as I can tell, the only established reason for some of the rise is that the US dollar has fallen in value. So the Saudis aren’t getting the value for their oil they expect and have factored that in. But that’s small potatoes.
Like I said, it is unprecedented. There’s no boycott, no disruptive war (Iraq wasn’t a major producer before Bush’s War), etc. But Certain People saw the most recent rise coming. A few months ago oil futures shot up. Those people made a killing.
Find out who those people are and why they knew in advance, and that will answer the question. “Follow the money.”
While I don’t fully understand what is going on, the variation in prices is weird. Not just day-to-day, but station-to-station (even within the same brand).
Around me (suburb of Milwaukee) the stations seem to be pretty diligent about matching the competition. It’s rare to find a variation of more than a couple cents a gallon. Yet one day last week it was $2.03, the next day $2.09, and the day after that it was $2.05.
This past weekend I was in a Chicago suburb and within just a few miles of one another I saw prices ranging from $2.19 to $1.93. Needless to say, the $1.93 stations had lines of cars waiting to fill up their tank.
Is it possible all the gas station owners in your neighborhood got together and conspired to raise gas 10 cents? Possible, yes, likely no.
It would likely occur to one of the conspirators that if they broke the agreement by a few cents, he would sell so much more gas than usual, more profit would be made by breaking the agreement than otherwise.
Gas is one of the few products where the price is posted outside in big numerals so consumers will know the price before stopping. The surprising thing would be if prices in a given area had a wide spread, not a small one.
I talked to a gas station manager that told me she prices her gas $.01 cheaper than the competitor across the street. No matter what. This way it wouldn’t look like a price war.
I also talked to a guy that worked as a clerk that would have to drive around town to check the competition and set their prices accordingly.
I suppose we could all don our tin foil hats and pester the FTC to look into it. But the FTC will not do anything unless it has reasonable suspicion. For the record, a case cannot be made for collusion based on “high prices” alone, especially when there’s ample evidence the high prices are due to an effective decrease in supply.
Knowing the price your competitors are selling a product for is just good business. It’s not collusion at all. Collusion is when the price-setters get together and decide that they will all price at a certain point, and of course the agreement is that no one will violate the agreement and sell below that price. Labor unions are allowed to do this, businesses are not.