May 25, 2007
Expensive Gas - More Competition Needed
The petroleum corporations are pricing gasoline
so that their supply of gas is sufficient for the
demand. If demand were greater than their
supply of gas, then they would run low of gasoline,
and gas stations would either close down, waiting
to be re-supplied,...
...or avoid closing down by limiting the amount
gallons people could purchase with each visit.
This is rationing, and that creates long lines at
gas stations which happened during the oil crunches
in the 1970's.
The capacity of the refineries is at a low ebb
due to repair and ultimately because they haven't
built a new refinery in the U.S. since Carter
was President. Summer is coming on and they
raised prices so that their low supply was adequate
for the demand rather than run out of gas.
In other words, the corporations lowered
demand by raising prices.
Until big money invests in competition to the
petroleum industry (cellulosic fuel refineries),
and gas stations independent from big oil,
We will remain hostage to the petroleum corporations
strategy of not building refineries to meet the
demand. The media can advise us how to
get more out of our high priced gasoline, and the
Senators can hold their hearings and pass meaningless
laws, but supply and demand rule. We need more
competition in our energy sector.
Posted by Muggins