What the heck is going on with gas prices these days? Each time I fill up at the pump, I’m paying more for less – that’s an equation I’m not entirely comfortable with!
A year ago at this time, the cost of oil was higher than it is today. Logic would dictate that fuel, therefore, would decrease with the cost of oil. Instead, we watch our fuel prices climb higher and higher while the cost of oil continues to decrease.
Perhaps there’s less supply, right? Nope.
Maybe the gas companies fear running out of fuel because the Organization of the Petroleum Exporting Countries (OPEC) is reducing production to drive up the price of oil? Nope, that’s not it either.
Maybe the government has increased taxes on fuel? Nope, wrong again.
I’ve read numerous explanations for the recent increases. Some explain that North American refineries have closed, which has decreased the amount of fuel being produced. But, existing refineries have increased production to match consumer demand. There are also theories about tensions and conflicts in oil-producing countries like Iran, Syria and South Sudan that have reduced exports lately; however, the amount of oil being dealt out around the world is higher than a few years ago when OPEC was reducing supply to increase crude oil prices. It just makes no sense to me.
Practically everyone is affected by these increases that see our disposable income eaten away by artificially inflated gas prices. To make matters worse, higher fuel prices are a major contributor to inflation. Why is this bad you ask? Governments control inflation by increasing interest rates. So, you can expect your mortgage payments (and other payments) to increase faster than expected if gas prices don’t settle. That will cost you quite a bit more than a few extra bucks at the pump each week.
Some suggest that we should be grateful that we don’t live in certain parts of Europe, where prices are near double to what we pay; however, these Europeans have shorter distances to drive and enjoy a fantastic public transportation system.
I think the only word that applies here is collusion. It is time for political intervention. That fuel companies can get away with this is nonsensical. If I lose my public service job in the recent rounds of cuts, I may target the gas industry for a lucrative position making money off excessively and unnecessarily high gas prices. If you can’t beat ‘em, join ‘em!?!