Well basic economics will tell you that usually two factors will work together to determine what the price of a product will be. The first is supply. The amount of any specific product that you have readily available to sell. And the second is the demand for that product. With essential products such as gasoline, there is always a demand and it is usually fairly predictable. During the summer, prices traditionally rise because it is an American tradition to pack the family in the car and go somewhere. When millions of people across the country do this at roughly the same time, this causes a huge spike in demand, allowing the prices to rise.
In the early part of 2009 we saw more and more however that although prices continued to fall on raw crude oil, (thus the cost of the base raw material was cheaper) while at the same time demand was dropping sharply as well as people had become accustomed to conserving gas during the huge price increase the year before. Most refineries were working at only 70% of their capacity in order to keep to much processed gasoline from hitting the market. Even so, the national oil reserves were reporting gains across the board.
So with massive increase in supply, and a fairly large decrease in the demand for the products, the market dictates that the price of oil should have dropped. Instead they started increasing. When all of the facts are looked at closely, it would seem that those who refine and distribute gasoline in the United States of America, had decided to band together and all increase their prices despite a failing market for their product.
Normally, a free market would regulate such a trend. If the price of something is out of line, you just don't buy it. This done on a mass scale would cause a business to lower their prices, or fail. However with essential items, such as food, and energy, the market cannot properly respond. Although we would love to give these price gougers the finger, we cannot simply not buy gasoline, as there is not a valid alternative.
Many of the antitrust and monopoly regulations that are a part of American Corporate Law are put into place so just such an incident cannot occur. However, the evidence increasingly indicates that the oil industry companies are doing exactly that. What's worse, is that nobody in any recent administration has taken the necessary steps to prevent such an event from occurring.
It is an interesting connection that while we were having the largest crisis based around the price of fuel in recent history, a former oil company CEO sat in the oval office, and Big Oil companies released the highest profits of any company ever in global history.
Because the demand is going up making the supplies go down causing there to be a more costly price for the now a little bit more rare gas. And besides, gas prices are going up? My gas prices are lower than 2 bucks! That is little to spend for the gas that used to be 3.50.
Gas prices are so high in America because, the U.S is very dependent on forigen oil.
Supply? Price fixing? Government inaction? Pick which people you want to blame because it is all three.
Instability in the Middle East causes them to demand higher prices from oil buyers over here, thus making the citizens of the US suffer from the lower supply of gas.
more n more people buy cars n cars need gas
Gas prices are high everywhere nowdays because it is getting harder to find it.
Because no one wants to buy it due high prices.
1973?
For the same reason that gas prices are high in Hawaii: neither state has any oil refineries, so all petroleum products including gasoline must be imported from places that do and this must be done via ships, not pipelines or trucks (both of which would be cheaper).
400.00
Gas prices are high everywhere nowdays because it is getting harder to find it.
He thinks they are to high to so he is going to lower the prices of gas
"The current british gas prices are very high. They start off with 10 pounds a galon. If you are not willing to pay super high gas prices like in London, you may have to relocate."
Because no one wants to buy it due high prices.
1973?
No. Gas prices have not caused this recession. This is because of the severe credit crunch.
For the same reason that gas prices are high in Hawaii: neither state has any oil refineries, so all petroleum products including gasoline must be imported from places that do and this must be done via ships, not pipelines or trucks (both of which would be cheaper).
124.5 nominal 3.25 real
Where and when, this is too vague a question.
400.00
the relationship demand has with prices is that when the demand for a product is high the prices go high as well, like gas and food....
There are several reasons for why the fuel and oil prices are so high. One reason is that the commodite traders bid up the price on the gas contracts. Another reason is beacause the oil prices are a bit rude today, mainly due to oil costs account for a large portion of the price on gasoline. So if the oil price rises so do the price at the gas station about six weeks later.