Posted on 04/11/2005 5:58:56 PM PDT by OESY
Gas prices are at record highs again. Many think oil companies are to blame. In fact, a May 2004 poll showed that 77 percent of Californians believed this to be true. However, this just shows the media have failed to properly inform people about who's causing high gas prices.
One thing is certain: oil companies are not to blame for high gas prices. These companies are responsible for producing the gasoline we need. In California, where gas prices are among the nation's highest, the oil industry has been repeatedly investigated to find evidence of "price manipulation" and none has ever been found.
Although there are other causes of high gas prices, such as high gasoline taxes, the primary cause is environmental regulation. For example, environmental regulation has significantly restricted drilling for oil in Alaska and on the continental shelf. More drilling will increase the gasoline supply (up to 10 percent from greater Alaskan drilling alone) and thus lower prices.
Further, there are currently 18 different gasoline formulations in use across the United States, making it much more costly to produce and distribute gasoline. These blends aren't needed due to requirements of automobile engines, nor are they required by oil companies. The blends, including different ones used at different times of the year and in different geographic areas, are forced on Americans by environmental regulations. Among other things, the regulations force refiners to incur greater costs in switching from the production of one blend to another. They also force refiners to produce a more costly "summer blend," which is partially responsible for the current rise in price.
The situation is worst in California, where environmental regulations are strictest. For example, California was one of only three states to require the removal of the octane booster MTBE in January 2004. This reduced the gasoline supply by almost 10 percent.
Using corn-based ethanol as a replacement doesn't help much since California's strict emissions regulations require the removal of almost the equivalent in other gasoline components to accommodate ethanol. Ethanol alos must be shipped from the Midwest in trucks since it cannot be produced in refineries and doesn't travel well through pipelines. As a result, gasoline prices were predicted to increase 35 to 40 cents. Given that the average price in 2004 was almost 30 cents higher than in 2003, these predictions weren't too far off.
Additionally, the California government forced gasoline stations to install double-walled underground tanks, which forced many stations to rip perfectly good single-walled tanks out of the ground. It also imposes the harshest emissions requirements in the country, which makes necessary the use of a more costly, special blend of gasoline not produced anywhere but in California. It's no accident that gas in California is generally 30 to 40 cents above the national average.
From drilling to refining to distribution, environmentalists have done everything they can to raise the price of gasoline.
The above raises a question: Why do environmental regulations exist?
One might think they exist to protect consumers, but the evidence doesn't show this. For instance, MTBE was banned based on claims that it causes cancer. However, it has never been shown to be a danger to humans in the amounts to which they might be exposed. Claims that it "causes cancer" are based on experiments in which mice were fed doses almost 70,000 times larger than to what humans might be exposed. No scientist worthy of the title would make claims based on that kind of extrapolation.
Environmentalists are not actually concerned with the well-being of man. Their real motive is to sacrifice man to nature by stopping industrial activity. This is what they explicitly state. For instance, Adam Kolton of the Alaska Wilderness League states, "Drilling the wildest place in America is objectionable no matter how it's packaged." David M. Graber, a research biologist with the National Park Service, states, "We are not interested in the utility of a particular species, or free-flowing river, or ecosystem, to mankind. They have ... more value – to me – than another human body, or a billion of them."
Oil companies deserve to be praised for producing an abundance of gasoline despite the massive burden of environmental regulations foisted upon them. To increase the gasoline supply further, we need to start by eliminating these regulations. If the government makes the choice to protect people's freedom, gasoline below a dollar-per-gallon won't be just a relic of the past.
Markets I thought failed in 1929 but heck im not a professor
I want to know when we are going to build at least one new refinery.
Not to worry, any day now our fearless Governator is going to be leading the charge for more refineries and relaxed enviornmental regulations. He knows how this is hurting the economy and working families. Any day now. Just you wait. Soon. Real soon.
Each time your local TV or Radio station does a story on gas prices, e-mail them and ask that they break out the actual tax per gallon in their report.
I heard on the news over the weekend that the government has finally approved another refinery being built for the first time in nearly 30 years. Unfortunately that's I'll I heard on the news.
Why would a business lower it's profit margins when it doesn't have to?
Modern Day Post-MBA capitalism is based on sucking the as much as possible from the Workers, the Investors and the Consumers without killing them off.
People aren't in business in order to make other people's lives better, they are in it to make as much money for the least amount of work.
The market collapsed because stocks were grossly over-valued. That's not a failure of the market. Instead, it's a market doing what it is supposed to do -- undergo constant correction to reflect real value.
The market collapse turned into the Great Depression, instead of a recession, because government policies in response to the market's collapse were bass-ackward.
a. Taxes were raised, inhibiting any economic recovery.
b. Tariffs were increased, depressing world trade and, thus, economic activity.
Ergo, the market collapsed (correctly). Then, the government's economic policy failed.
"...Markets, I thought, failed in 1929..."
No, the government blew up the economy in 1929.
That's what happens when socialists meddle with capitalism.
Free markets don't fail, or not as often anyway. The trick is to know what is meant by free market. An unregulated market is not free.
The oil companies aren't poor, innocent victims of high oil prices. They simply pass their costs to the consumers, the ultimate (and often poor) victims of regulatory costs and excessive taxation.
The reason, the ONLY reason, for the gasoline prices today is the bleeping regulatory EPA and the bleeping evironazis.
Bleep them all, bleep it!
The market did what it should have done--collapsed under the weight of sheer speculation after the value of the goods traded were resassessed conservatively and found wanting. There were a lot more people trying to get something for nothing (i.e., with other people's money) who got caught on margin when the Fed decided to f around with interest rates.
SOME ADDITIONAL AMMUNITION:
Think a gallon of gas is expensive?
This puts things in perspective.
Diet Snapple -- 16 oz $1.29 ...... $10.32 per gallon
Lipton Ice Tea -- 16 oz $1.19 ...........$9.52 per gallon
Gatorade -- 20 oz $1.59 .... $10.17 per gallon
Ocean Spray -- 16 oz $1.25 ......... $10.00 per gallon
Brake Fluid -- 12 oz $3.15 ........... $33.60 per gallon
Vick's Nyquil -- 6 oz $8.35 ... $178.13 per gallon
Pepto Bismol -- 4 oz $3.85 .... $123.20 per gallon
Whiteout -- 7 oz $1.39 ....... . $25.42 per gallon
Scope -- 1.5 oz $0.99 $84.48 per gallon
And this is the REAL KICKER...
Evian water 9 oz $1.49..........$21.19 per gallon?! $21.19 for WATER - and the buyers don't even know the source. (Evian spelled backwards is Naive.)
So, the next time you're at the pump, be glad your car doesn't run on water, Scope, or Whiteout, or God forbid Pepto Bismal or Nyquil.
SO WHY HAS CONGRESS NOT PASSED THE PRESIDENT'S ENERGY BILL? THEY HAVE HAD FIVE YEARS.
"People aren't in business in order to make other people's lives better, they are in it to make as much money for the least amount of work."
You say that like it's a bad thing.
Poor Ahnold....he can't help it. He was born with a green streak.
He'll see to it that the refinerires are built in Mehheeco....I mean they'll give Kaleephornia the gas for free ....won't they?
Maybe someone can tell me why diesel, the cheapest fuel to refine, is the most expensive at the pump.
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