Cynical Synapse

Sat, 28 Mar 2009

Signs of Spring: Rising Gas Prices

With the appearance of consistently warmer weather, gas prices are inching up. Its as if Big Oil thinks springtime means money time. We hear a lot of different reasons. Demand is going up. Refineries are shut down for maintenance before the summer driving season. We have to switch over to summer formula. (Which really costs more to produce: summer or winter formula? Seems the price goes up with both switchovers.)

Take away the refineries being shut down argument. The vast majority of refineries are operating. What’s shut down accounts for a little over 1.1 million barrels per day. That’s about 7% of capacity.

I was a little surprised to see gas prices in Lansing jump up 20 cents between Tuesday morning and afternoon. Unfortunately, I still had a half-tank and decided to wait a day to fill up. Had I thought to look at the latest gas price predictions, I would have filled up anyway. Right now, the prices are the same in my metro Deroit neighborhood as they are in Lansing.

Conventional thought has it that gas prices will continue to rise into the so-called summer driving season. I’m not convinced folks will want to do that much extra driving this summer, with the economy being what it is. But, we’ll still be told the increased prices are due to supply and demand. While I understand that formula, it’s just hard to accept when oil companies represent 7 of the highest 10 profit makers. Another reason why I’d like to see an end to oil company tax subsidies and loopholes. Seems many of the speculators who had a hand in last year’s outrageous gas prices must have lost their shirts in Wall Street’s implosion, or maybe they were Bernie Madoff customers. Let’s hope the oil market continues its cautious behavior. If you want to sign the petition linked to on Utah Amicus, fine. If not, how about sending your US Senators and Representative a message telling them to end corporate welfare to companies obviously not in need of such entitlements.

1 Comment

  1. Yea, you’re right. And did you notice that the price of oil mysteriously started going up the same day the feds announced they were committing another $1.2 trillion to Wall Street in spite of lower consumption and higher inventory numbers? Since then the price of oil has risen $15 per barrel, or 31%. But it’s supply & demand, right? It could never be the speculators who recognize the power of free money from the taxpayers.

    Comment by Old-Man — Sat, 28 Mar 2009 @ 9:24 pm

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