http://money.cnn.com/2005/03/08/news/economy/gas_prices.reut/index.htm?cnn=yes

So they are going up. I don't get how someone decides what the price is supposed to be in the first place? ANyone have a clue? Seems that it always goes up when summer comes around--just in time to soak the tourists who are planning Spring vacations.

http://money.cnn.com/2005/03/08/news/economy/gas_prices.reut/index.htm?cnn=yes

So they are going up. I don't get how someone decides what the price is supposed to be in the first place? ANyone have a clue? Seems that it always goes up when summer comes around--just in time to soak the tourists who are planning Spring vacations.

Bush and the other secret members of the "Fellowship" regulate gas prices to control the minds of the Sheeple.

I will defer to others to prove my point for me.

http://money.cnn.com/2005/03/08/news/economy/gas_prices.reut/index.htm?cnn=yes

So they are going up. I don't get how someone decides what the price is supposed to be in the first place? ANyone have a clue? Seems that it always goes up when summer comes around--just in time to soak the tourists who are planning Spring vacations.

Well, maybe some lessons in supply and demand are in order? ;-)

Having just settled a large lawsuit in which oil prices were a critical component, what I can say is that it's very complex, but still largely related to supply and demand. Sometimes the supply end is artificially manipulated, though, and I can't begin to describe the political or economic motivations of OPEC, for example.

Increasing demand by (rapidly) developing nations, primarily China, now, is making a huge difference. An expert on the subject told me that if every family in China bought a refrigerator, the global market would be in a panic.

Many areas have gasoline reformulated in summer, and this reformulation can be more expensive. However, it's largely related to more people driving more in summer, plus increased air conditioning costs. More and more, prices of various fossil fuels are related on a BTU equivalent basis, so if there is an increased demand for coal or natural gas for power plants, this affects the price of gasoline, too.

http://mb12.scout.com/fhawaiifrm1.showMessage?topicID=14578.topic

Just wondering that too. If oil prices per barrel have tripled in the last few years, but you're only paying 50% more at the pump, where did the extra margin go?

Have the oil companies have to slim down their profits? If so, how much more fat can they trim? I also wonder why gas prices go up on Friday afternoons.

The big player on the block. From a study by Macquire Bank, Citgroup and Bernstein, of the following chemicals, minerals and energy, China consumes these percentages:

Coal - 28%
Steel - 27%
Copper - 24%
Nickel - 22%
Zinc - 21%
Tin - 20%
Aluminum - 20%
Polyethylene - 15%
Lead - 13%

(These are 2003 estimates)

China is a MAJOR player.

Just wondering that too. If oil prices per barrel have tripled in the last few years, but you're only paying 50% more at the pump, where did the extra margin go?

Have the oil companies have to slim down their profits? If so, how much more fat can they trim? I also wonder why gas prices go up on Friday afternoons.

A significant portion of what you pay at the pump is taxes (about 50 cents per gallon in California, for example). So if gas prices were $1/gallon in 2000, that was 50 cents tax, 50 cents for the commodity itself. If the commodity price triples, you pay $1.50 per gallon for the commodity, and still only 50 cents in tax, merely doubling the retail price, though the wholesale price has tripled.

there is no price fixing at the retail level? funny.
wow, out here in the port city of San Diego our fuel prices are higher than in Arizona and they ship the fuel from here to there. (our fuel prices are far higher than NAt'l Average)
why is it, that areas with higher median incomes seem to pay higher gas prices? that doesn't seem like pure supply and demand.
wow and how come if it's pure capitalism Gas Stations on opposing corners never seem to get into price wars?
look there's as many anti-trust violations in the fuel industry as Microsoft has had yet they avoid federal anti trust prosecution. why?
I'm not blaming Bush here, they've bought off politicians from both sides on these issues for decades

True dat. Canada also, we're at about 30%. We even have a GST (consumption tax) that taxes the other taxes. Whew!

there is no price fixing at the retail level? funny.
wow, out here in the port city of San Diego our fuel prices are higher than in Arizona and they ship the fuel from here to there. (our fuel prices are far higher than NAt'l Average)
why is it, that areas with higher median incomes seem to pay higher gas prices? that doesn't seem like pure supply and demand.
wow and how come if it's pure capitalism Gas Stations on opposing corners never seem to get into price wars?
look there's as many anti-trust violations in the fuel industry as Microsoft has had yet they avoid federal anti trust prosecution. why?
I'm not blaming Bush here, they've bought off politicians from both sides on these issues for decades

This has been investigated up and down a number of times. It's not price fixing. It's actually shocking what the profit margin (at the station level) is. Gross margin on gasoline is typically 2-3 cents per gallon. That's why gas stations sell slurpies and snickers bars - they make 10x more on the Big Gulp than they do on the gas.

As for Arizona vs. California, Southern California requires a more expensive, cleaner burning formulation of gas, and there's 13 cents per gallon less tax in Arizona than California. So you would expect prices to be lower in AZ than in San Diego.

The oil and gas industry (beyond OPEC) is really a cut-throat, competitive industry. There's not that much money to be made on the retail side - it's all in finding the stuff and drilling.

True dat. Canada also, we're at about 30%. We even have a GST (consumption tax) that taxes the other taxes. Whew!

It's not all bad, actually. The higher taxes shelter you, to some degree, in commodity price fluctuations.

aware their margins a low but why is it Arco is always cheapest. why is it most base price on Mobil (main supplier on wholesale level) why no competition.
CA to AZ makes some sense but where's their price increase for shipping. CA prices aren't across the board equal either. San Diego far higher than LA and we use the same fuel. I understand base price as set by OPEC, but at the retail level when I see 2 stations trying to increase business by uinderselling each other I'll buy the rest. Why again then do small 'family owned mom and pop' (a dying breed here in So Cal) have cheaper prices though they lack the volume discount or franchise discounts of the big boys? It is inverse Wal MArt-ism which goes against coventional S&D wisdom. It doesn't follow pure supply and demand theory. Exxon - Mobil (one copr flag) and Shell-Texaco (same) are the main wholesale suppliers yet their retail outlets are usually the highest priced, why?

aware their margins a low but why is it Arco is always cheapest. why is it most base price on Mobil (main supplier on wholesale level) why no competition.
CA to AZ makes some sense but where's their price increase for shipping. CA prices aren't across the board equal either. San Diego far higher than LA and we use the same fuel. I understand base price as set by OPEC, but at the retail level when I see 2 stations trying to increase business by uinderselling each other I'll buy the rest. Why again then do small 'family owned mom and pop' (a dying breed here in So Cal) have cheaper prices though they lack the volume discount or franchise discounts of the big boys? It is inverse Wal MArt-ism which goes against coventional S&D wisdom. It doesn't follow pure supply and demand theory. Exxon - Mobil (one copr flag) and Shell-Texaco (same) are the main wholesale suppliers yet their retail outlets are usually the highest priced, why?

One reason that the "majors" are higher priced is that they are selling a "branded" product. Mobil is always the most expensive (at least around here), and they are trying to be the "higher-end" player in the market. Also, a "mom-and-pop" actually has the advantage of choosing their supplier - they aren't stuck with Exxon gas; they buy whatever is cheapest that week.

It's not a simple thing, but almost every state A.G. has investigated it, and they never find evidence of price fixing.

If WallMart didn't buy so much crap from China, The people in China wouldn't have jobs in manufacturing industries. They wouldn't need so many trucks to move product around, and the people wouldn't be able to afford cars.
Blame it on WallMart.

All we need to do is set up a puppet government in a oil producing country, so that they will sell their oil to the good ol' USA.

why is it, that areas with higher median incomes seem to pay higher gas prices? that doesn't seem like pure supply and demand.

The price at the pump isn't just the cost of gasoline; you have to include real estate/lease, labor, local taxes, etc., that all affect the retailers' total costs. The convenience store in downtown San Diego probably isn't paying the same rent or labor as the ones in Yuma or Barstow.

Each retailer will charge what it's market will bear; if others are charging $2.50, then I'm going to as well -- at least close to it, or else I'm throwing money away.

The big player on the block. From a study by Macquire Bank, Citgroup and Bernstein, of the following chemicals, minerals and energy, China consumes these percentages:

Coal - 28%
Steel - 27%
Copper - 24%
Nickel - 22%
Zinc - 21%
Tin - 20%
Aluminum - 20%
Polyethylene - 15%
Lead - 13%

(These are 2003 estimates)

China is a MAJOR player.

Yes, and probably increasing at a greater rate than any place on the planet. They manufacture more; they make more money; they buy cars and live a more expensive lifestyle, which requires more fuel.

"Be careful what you wish for" -- maybe Nixon should never have gone to China.

Each retailer will charge what it's market will bear; if others are charging $2.50, then I'm going to as well -- at least close to it, or else I'm throwing money away

and that ain't pure S & D. why not undercut by a couple cents and make up in volume?
run them out of business and own the block?
Higher Income areas, will bear more (as most are too lazy or scared to drive to lower income areas for their gas) as a convenience.

again I understand all these issues, and I thank you for clarifying, but my main point is, it ain't pure capitalism.

also isn't 'if others are charging, then I'll charge the same or near, just unspoken price fixing?
where's the spirit of competition?

Each retailer will charge what it's market will bear; if others are charging $2.50, then I'm going to as well -- at least close to it, or else I'm throwing money away

and that ain't pure S & D. why not undercut by a couple cents and make up in volume?
run them out of business and own the block?
Higher Income areas, will bear more (as most are too lazy or scared to drive to lower income areas for their gas) as a convenience.

again I understand all these issues, and I thank you for clarifying, but my main point is, it ain't pure capitalism.

also isn't 'if others are charging, then I'll charge the same or near, just unspoken price fixing?
where's the spirit of competition?

They charge, to a degree, what the market will bear. But if it gets out of line, somebody will start cutting prices to get the volume. There's definitely a band of prices that they float within. It is, generally, pretty damn close to pure competition.

They charge, to a degree, what the market will bear. But if it gets out of line, somebody will start cutting prices to get the volume. There's definitely a band of prices that they float within. It is, generally, pretty damn close to pure competition.

I'm confounded by some areas where I'll see two or three gas stations at the same intersection, and one will be charging ten cents a gallon more than the others, and still is busy. Go figure. Could be the location relative to the traffic flow, better donuts, cleaner bathrooms, brand credit cards, whatever, but price obviously isn't everything.

Some C stores (I have represented a bunch of them) will not even attempt to make much money on the gas, attracting the traffic in, and make a killing on inside sales like soda and garbage food.

Different retailers are competing differently.

Each retailer will charge what it's market will bear; if others are charging $2.50, then I'm going to as well -- at least close to it, or else I'm throwing money away

and that ain't pure S & D. why not undercut by a couple cents and make up in volume?
run them out of business and own the block?
Higher Income areas, will bear more (as most are too lazy or scared to drive to lower income areas for their gas) as a convenience.

again I understand all these issues, and I thank you for clarifying, but my main point is, it ain't pure capitalism.

also isn't 'if others are charging, then I'll charge the same or near, just unspoken price fixing?
where's the spirit of competition?

The less elastic the demand, the market will accept a higher price. Also, there could be a surcharge to the gas station for each delivery the station receives, thus cutting price and doing higher volume would errode margins further.

Just a guess.

Deek

When the middle east is in our pocket and Americans have received the elbow room they so rightly deserve and have smote the middle east then you will see the gas prices fall. We will own the pipelines and China will be forced to renounce their owned debt of ours. It will be glorious.

When the middle east is in our pocket and Americans have received the elbow room they so rightly deserve and have smote the middle east then you will see the gas prices fall. We will own the pipelines and China will be forced to renounce their owned debt of ours.

Not to encourage the trolls, but there could unfortunately be a kernel of truth somewhere in there, China notwithstanding.

If WallMart didn't buy so much crap from China, The people in China wouldn't have jobs in manufacturing industries. They wouldn't need so many trucks to move product around, and the people wouldn't be able to afford cars.
Blame it on WallMart.

All we need to do is set up a puppet government in a oil producing country, so that they will sell their oil to the good ol' USA.

The Chinese are wiley. They tap into American technology to ramp up a manufacturing base, supply the insatiable American market for consumer goods, then make so much money they can afford to shore up that very consumer market with loans and investments, making even more money, while the Americans go into trillion dollar deficits financing their gas guzzling SUVs and mortaging their huge McMansions, hoping for a good return on their investments.

How long will the American economy be able to "absorb" the huge increases in fuel costs, before those McMansions become as obsolete as dinosaurs and we'll all be riding bicycles (cheaply made in China)?

With the price of fuel probably staying this high or going higher, the future is small and economical: 3 bedroom row houses with basements. Hybrid cars. Public rail transportation. Planners, politicians and voters need to overcome their denial and cough up some tax revenues. It won't be that difficult: just build rail lines along the freeway right-of-ways to get people where they're going. The astronomical cost of gasoline will take care of the rest.

They want their $39 DVD players (made in China), their $499 computers (made in China), their $2100 HD Wide screen TV's (made in China), and in a few years, their $12,000 cars (made in China). All this money is going somewhere. What money is coming back here to provide jobs ? (except at WallMart and fastfood joints )
Who in their right minds would want to pay $150 for an American made DVD player. Who would want to pay double for a computer ? Who would want to pay $5000 for an American TV ? We've still got the market on large cars.....(for a few years)

under $1500 for a well equipped but made in China roadbike. (this is a cycling forum right?)
money comes back when they buy our debt and our mortgages.
Sorelian has it wrong. The chinese will come to collect using the new Neo Con Bankruptcy laws and many Proud Americans will find themselves indentured to a Chinese industrialist. They will beat us at our own game because they practice patience.

They want their $39 DVD players (made in China), their $499 computers (made in China), their $2100 HD Wide screen TV's (made in China), and in a few years, their $12,000 cars (made in China). All this money is going somewhere. What money is coming back here to provide jobs ? (except at WallMart and fastfood joints )
Who in their right minds would want to pay $150 for an American made DVD player. Who would want to pay double for a computer ? Who would want to pay $5000 for an American TV ? We've still got the market on large cars.....(for a few years)
The problem is far worse than that. Outside of autos, can you list the domestic manufacturers of any of those products? Even the American auto industry is increasingly outsourced for production and components. What percentage of your car was manufactured in the US? Was it assembled here? Do the profits from its sale stay here?

The problem is far worse than that. Outside of autos, can you list the domestic manufacturers of any of those products? Even the American auto industry is increasingly outsourced for production and components. What percentage of your car was manufactured in the US? Was it assembled here? Do the profits from its sale stay here?

What happens when our standards of living reach equilibrium, when wages and costs are the same there as here? Do manufacturing jobs return? Didn't we, in effect, help Japan reach that state? Do jobs then get shipped out of China to somewhere else? Can the whole planet reach equilibrium?

What happens when our standards of living reach equilibrium, when wages and costs are the same there as here? Do manufacturing jobs return? Didn't we, in effect, help Japan reach that state? Do jobs then get shipped out of China to somewhere else? Can the whole planet reach equilibrium?
If, and that's a big if, equilibrium is ever reached, I would think that the manufacturing would return. Why go through the expense of off-shoring if all other factors are the same? Honestly, the only standard of living I care about is our own. I don't give a rats ass about the Chinese. There are other, better ways, IMO, to increase the standard of living around the world while maintaining domestic production/manufacturing capabilities.

What happens when our standards of living reach equilibrium, when wages and costs are the same there as here? Do manufacturing jobs return? Didn't we, in effect, help Japan reach that state? Do jobs then get shipped out of China to somewhere else? Can the whole planet reach equilibrium?

The Japanese have been manufacturing cars in the US for a decade, mostly for the US market. Honda and Toyota come to mind. They realize American labor is second to none when properly motivated.

Japanese, Europeans, along with the Saudi Arabian oil magnates are also buying investment properties in the US, like big office buildings in San Francisco and New York, futhur enhancing the ties that bind.

Equilibrium could be achieved if the Chinese buy as many Americans goods as Americans buy Chinese, in other words, with a balance of trade. But it might not work that way. Eventually, American labor in American factories might be building all kinds of goods for the American market, the same in China, Japan, India, and Europe, which multi-national corporations have already been doing for some time.

Or, with CAD design technology and computerized manufacturing, a small company anywhere in the world could make a widget for any market on request. Car manufacturers can now build complete cars, from design concept to finished product, in about 6 months. Gone are the days when it took 5 years to get a new design on-line. It's pretty amazing how roses grown on the hillsides of Bolivia can end up in florists in Dubuque, Iowa in 2 days, or families in Denton, TX., can snack on Israeli oranges purchased at the Piggly Wiggly.

as they don't get paid shite. (why their stuff is cheap - labor costs) so if we up their labor pay, our goods get more expensive, sooner or later it becomes as cheap or cheaper to make here. Mfr comes home and wealthier Chinese middle class can buy more American goods.