Know What
I'm Sayin'??
Friday, July 28, 2006
Back on my High Horse
I've written a post or two or three about gas prices, and I've been on the verge of writing more, but restrained myself.

No more. I've got to speak out. I can't believe that I'm the only one bothered by this.

Someone please tell me where my logic is faulty. A few facts (as I see them).
  1. Every year there are a bunch of new drivers.
  2. Every year there are a bunch of old drivers that stop driving.
  3. Taking 1 and 2, it stands to reason that the number of drivers from year to year should not fluctuate wildly.
  4. Gallons of gas sold. If anything, perhaps this number should be going down, due to the rising gas prices. Even if it is going up, there still shouldn't be any huge dramatic fluctuations because there haven't been any huge revolutions in travel.
So I reach a few conclusions: If the number of drivers is relatively constant from year to year and the number of gallons of gas used is relatively constant from year to year, then as long as the gas companies don't play with their cut too much, their profits should also be constant, regardless of the price of crude. Right? If I profit $0.10 per gallon, then it shouldn't matter if the gas price is $1.00, or $10.00. I still get $0.10. Keep in mind that I'm being VERY liberal in my use of the word "constant".

HOWEVER, that's not the case. The gas companies continue to post RECORD PROFITS. This tells me that as the price of crude is rising, the amount that the gas companies tack on is also rising.

What's the solution? I sincerely wish that his tirade could end with a ground-breaking master plan to reduce gas prices, but I don't know. The goverment types say "Conserve" and that even a slight reduction in the demand would force a drop in prices. That's asking alot, because most people don't drive for pleasure. We have places we need to go! The end consumers are not the problem. It's the damn gas companies.

I've said elsewhere that this is disgusting, so I'm forced to resort to the dictionary: This is an outrage, and an affront. Makes me want to buy a hybrid car, not in order to save money, because calculations have been done to show that you don't really save that much, but to not give my money to Exxon and Co.

This is what would make me happy: The oil companies should take their current projections for their end-of-year profits, and drop gas prices with the goal of just breaking even. Lay bare the ledgers for all to see. To tell the truth, they don't need the money. They made more than enough last year. They should do this as a sign of good faith. It would be like them saying "See, we're not making any money, and still the prices are high. It's not us. It's the crude."

Wishful thinking. It'll never happen.

Know What I'm Sayin'??
Anonymous Anonymous said...
Your logic is faulty. Higher demand = higher prices. This isn't about little old ladies stopping driving every year. What do you think happens when millions of people from China and India demand more oil?