Here is what you’ve always wanted to know about gasoline prices.Â This was sent to me by one of my most brilliant friends.Â (Thanks Rich)
1. Speculators, trying to make money, set the price of crude oil based on supply and demand. When something happens that may affect supply, the price goes up. Because China and some third world countries are increasing their demand for oil, the price goes up.2. Gasoline companies must buy the oil from various places, most of which are unfriendly to the United States. When the price of oil in the world market goes up, they must pay more for this oil–the prime ingredient for gasoline.3. It has been decades since a new oil-to-gasoline refinery has been built because of environmental concerns. Oil is imported and then exported to other places to be turned into gasoline, then re-imported for sale in the U.S.
4. I heard that the profit from the gasoline companies comes to about 9 cents per gallon. The federal and state governments add on about 50 cents per gallon in taxes. For $3.35 per gallon, that is 2.7 percent profit. The rest of the 97.3 percent is what it costs to make and sell that gasoline.
5. When adjusted for inflation, we are paying less per gallon for gasoline than 20 years ago (I had the figures and did the math and it was true–last year).
6. At $3.35 per gallon, gasoline is still cheaper than Starbucks coffee! At
$3.35 per gallon, that is $0.026 per ounce. A $1.00 soda in a vending machine is 12 ounces. That is about 8 cents per ounce. I mention this because comedians are making jokes about the price of gasoline that do not make sense. Per ounce, gasoline, even at $3.35 per gallon, is still cheaper than many things–none of which will power a vehicle.
7. Brazil’s government nationalized (seized) the oil refineries and forced automobile manufacturers including U.S. and Japanese to make and sell ethanol powered vehicles. Ethanol is made from plant materials like corn and various sugar crops. If this is true, then WHY are we, the U.S., not following suit? WE have SO MUCH CORN in this country that we don’t know what to do with it ALL!
8. Alternative fuel vehicles are technically feasible and I believe that there can be a market for it… BUT PLEASE make it AVAILABLE!!! Many of these hybrid and alternative fuel vehicles are SOLD OUT and WHY? Because auto manufacturers don’t want to take a chance, so they only make a few and those sell out so fast! The automobile manufacturers are also under a terrible misconception that people want MASSIVE SUV vehicles!!! When gasoline prices go up and up and our national security and economy is in the hands of countries that want to destroy us, IT MAKES NO SENSE to continue to buy and sell gasoline vehicles!!!
9. CHINA is an EMERGING SUPERPOWER in the world. They HUNGER for OIL for manufacturing and for transportation. When there is more demand for a commodity, the price goes UP! Do we want to compete with CHINA on this? I say NOT. We need to switch over to alternative fuels–ESPECIALLY if it is one that we can manufacture in the U.S. and export to other countries!
Imagine that! CORN does not grow in the Middle East as well as it does in the U.S.