Re: gas prices vs. diesel

Posted by Kevin (FL) on July 24, 2007 at 07:56:56 from (70.149.219.77):

In Reply to: Re: gas prices vs. diesel posted by Gary in TX on July 24, 2007 at 05:19:50:

Gary,

Supply & demand is the basis for our economic system--have you ever heard what people pay for the latest gaming console for their teenage kids? Or what people pay for expensive import (and domestic) autos/trucks? Or, what about what people pay for a cup of "designer" coffee?

The US has to import about 60% of the crude oil needed to meet domestic demand. The crude oil price is set by world market factors of which the US has little if any control (other than ceasing all demand). Domestic crude production costs may or may not be lower than foreign production costs depending on drilling location, depth of water and other environmental conditions. The bottom line is that the oil companies have to buy most of the crude needed from foreign sources and the oil companies can't set the world price.

It could be argued that the oil companies could charge less for domestically produced oil but would a farmer sell his corn locally for $2.50/bushel if a foreign broker was offering $3.50/bushel?

Regarding the selling price of gas, the oil companies make pennies per gallon producing gasoline, yet the federal state and local government taxes add an average of 46 cents per gallon paid by the consumer.

To say that the gas prices of total are strictly due to who's in the white house is quite a stretch. For a little history lesson, the gas price per gallon at the start of Jimmie Carter's term was about 75 cents. When he left office it was $1.50.

And finally, I was in Italy back in 1991 and back then we were paying about $4.00 per gallon for our rental vehicles.

Replies:

• Re: gas prices vs. diesel gene bender 10:30:09 07/24/07 (1)
  • Re: gas prices vs. diesel Kevin (FL) 11:16:47 07/24/07 (0)

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