Who’s To Blame For High Gas Prices?

Have you heard somebody ask this question recently?  If so then you probably took them aside and explained to them that no single individual could be blamed for rising fuel prices.  Obviously it is an issue of supply and demand.  Global demand has now grown larger than global supply, which you can learn about in this article.  Though some people in the US claim that allowing more drilling in pristine wilderness or in the sea will somehow lower gas prices, all available information points to the fact that there is not enough petroleum under US territory to seriously augment global supply.  The only thing to be gained from more oil exploration and production in the United States is corporate profits, campaign funding, and degraded wilderness.  Conservation and the use of non-fossil fuels is the best means of making gas prices fall, but as the developing countries increase their standard of living they will continue to demand more cars and more luxuries.  Afterall, just remember what plastic is made out of!

So, supply and demand affect prices.  This is a simple economic concept that most people have heard of and understand.  It is a feature of the economy.  However, one Tea Party affiliated group has decided to ignore reality and try to blame market forces on a single individual.  Rather than explain it all to you, I’ll encourage you to read this blog by Brian Merchant,

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2 Responses to Who’s To Blame For High Gas Prices?

  1. Clearly there is a large constituency in the States with a predisposition to be susceptible to misinformation. Their rhetoric is best to counter by producing valid information rather than addressing them directly, which is akin to debating frustrated children; the same rules of conversation do not seem applicable. Of course no one individual can be targeted for fluctuations in market prices for hydrocarbon consumption, but certain groups may certainly be partially responsible to the whole of the dynamics involved. An interesting aspect of the largest players involved in oil production is that oil reserve levels are not open information, rather oil producing nations are free to report whatever level of oil they would like, without an international group to reflect concurrent data. This gives opportunity for, for instance the OPEC oil shocks of the 70’s to take place, and little change has subsequently occurred. If you would like to identify the main groups responsible for United States oil prices, of course there are a myriad of factors involved which determine the price, but a simple economic calculation falls shallow in fully addressing the influencing forces at play. The demand is indeed high and growing, peak oil is certainly close, and due to the lack of transparency in oil reserve levels, it may have already occurred, but I posit that the mystery in the supply dictates more of the price than the demand. The largest hand at play is trade agreements between MNC’s and OPN’s (oil producing nations). It has much less to do with the legislative policy of governments as it does with private deals made behind business room doors of the oil shilling sheiks of our time. To address fully the dynamics of oil pricing, I advocate for higher transparency in oil reserve levels, concurrent measurements to be taken by several international groups and open information transactions between corporate buyers and producers. These measures of course, must be addressed at a legislative level. One of the main frustrations for me is that international environmental groups, as well as international groups interested and influenced by oil dynamics have no real power to enact any desirable policy’s, even when they spend the time to vote on what is best. How then do they suspect they will accomplish any real progress, by asking politely?

    • Implementing a global network for petroleum transparency seems like a good idea, for consumers. However, the powers that be who thrive on price speculation would ensure that does not happen. Seeking to maintain this system rather than simply moving on to a new energy infrastructure only ensures the continuation of inefficient energy. You state that enacting such a system would require legislation but many people view “regulation” as the problem and they believe an unhampered marketplace is the only way for things to work. Clearly this is not possible. Even without regulation you can hardly eliminate insider corruption. This is the same for any system we propose. However, the documented environmental degradation associated with fossil fuel extraction, processing, and use seems far more destructive than solar, wind, geothermal, etc. I’m off topic here though. My problem relates back to the skewed information the public receives. Information is the only power the people can have in a republic such as ours. How do we get that back?

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