Top Of My Head

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Tag: oil companies

Quick thought on Gas Prices

Yesterday, I filled up my gas tank and it cost me $4.19 per gallon.  That’s an outrageous price.  This morning, I had planned to write an article about gas prices, barrel prices and why our government needs to get back or not send out the 4billion dollars in tax substities to the oil companies.  I think if a company is making 18 billion in profits, they shouldn’t get any tax breaks.  They make enough to pay taxes.

I wanted to look back at an article I wrote a few years ago, but it took a while to find it and now I don’t have time to do any research.  But, I still have an opinion, so here it is:

No more tax money goes to oil companies and if they don’t start lowering prices, as they easily could, it’s time for the government to strongly regulate them.

Try not to fall into the supply / demand trap that the oil companies want you to believe. There’s always going to be a demand. We need gas to power our cars, lawn mowers, snow blowers and everything else. We can’t not use gasoline.  We’re trapped.  Now, I haven’t worked out just how I think the government should regulate them, but I will and I’ll post it here.

I’m not normally one for government regulation, but in this case, I’ll make an exception.

Maybe they aren’t grouging us…

Wouldn’t that be a kick in the rubber parts, if the gas companies really aren’t raising prices unrealistically and they aren’t grouging us at the gas pumps?

Here’s some more research — Please note, the Barrel Prices comes from the Energy Information Administration and the prices for the gallons come from my own record (yes, I’m anal and I keep track of gas prices all the way back to 2002. I’m sure if I looked hard enough, I could find my notebook for before 2002).

Here’s what I found:


I tried to use data from around the sametime — I picked June because that’s when gas prices start their rise. Also, this is for gas purchased at stations located between Milwaukee and Racine, WI. Also, I did not adjust any of these numbers for inflation. I don’t figure that factors too much in since we’re only talking about a four year span.

The PricePerGallon is what I paid on the dates listed. The Barrel amounts are what the price of a barrel was during the same week. Now, the bad part of this is that the gas I’m pumping on 6/3/2002 wasn’t created from the barrel purchased at the same time, so the oil companies do make a little more off of the gas then they probably should, but I think it actually works out, as the prices at the pump drop when the price of a barrel drops — admittedly not as much.

Now, the % raise gas and the % raise Barrel is how much the gallon or barrel went up in price between the dates. You’ll notice that the Barrel raised at a higher % than the price of gas in each situation, if the oil companies “kept us even”, we would be paying a lot more for gas than we are. That’s the PriceRaised column. I took the price of gas and raised it using the % amount that the barrel was raised. According to my figures, on 6/1/2006, when I paid $2.99 a gallon — I was paying the correct amount. I don’t like it, but I think it was correct. (Of course, we could always argue that the price is off to begin with, but I still don’t know how much refining costs on a barrel of oil.)

I mean, I would hate to think that their profits really do come from the fact that more gas is sold, but I think what the oil companies are telling us just might be true.

And, isn’t that a kick in the rubber parts?

God Bless

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