• May 16, 2007
We resist writing posts on how expensive gas is nowadays because if we made it a habit, that's all we'd write. Every once in a while, however, there's a news story about gas prices that we can't ignore. This past week, the national average price of gas beat the previous record set in the first week of September 2005, the week following Hurricane Katrina's devastating landfall. The national average price of gas peaked at $3.11 that week. Since last January, however, the national average has been increasing on an uninterrupted pace. At the end of the first week of May, the average stood at $309.70. On May 14th, it was reported by the government to have risen to $314.30, eclipsing the previous post-Katrnia record. (Click here to view the government's archive of average fuel prices.)

We don't claim to be analysts in this area, so we wouldn't venture to guess what various factors are conspiring to push the price of gas ever higher. We don't know if or when it will level off, or perhaps even decrease, though we imagine the retreat of summer and colder temperatures will bring some relief. Nevertheless, we though it prudent to point out that as of May 14th, the price of gas is truly at record levels.

[Source: DailyFuelEconomyTip, Energy Information Administration]


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  • 38 Comments
      • 7 Years Ago
      All the billions of dollars in record profits the oil companies have made and they can't keep their goddamn refineries up to snuff. Pure greed. Please pass the vasoline to help ease the pain. Oh! I forgot that vasoline a petroleum product also, the price of vasoline probably went up to.
      • 7 Years Ago
      I miss the days when it cost me $12-15 to fill up my car. Now - only three years later - it costs almost $30.
      • 7 Years Ago
      Every year before summer season they raise gas prices and tell us its because of a shortage in capacity or some such garbage. They're raising it because there is more demand in the summer. That's all. Prices are controlled and manipulated to give profits without raping the consumer or killing the SUV industry. They'll go back down sometime around september (but not to pre-summer levels) and we'll be told its because there is excess supply or some other garbage. All the while the right will use it as a wedge issue against the left. It'll be the basis for all kinds of unfounded by truthy sounding talking points. Rush and Sean Insanity will go on for hours about how Hillary killed Vince Foster because he wanted to lower the gas tax or something. Matt Drudge will get involved too. Lots of flashing lights on his website to indicate breaking rumors, I mean news. And next summer it'll happen again only the prices will be higher.
      • 7 Years Ago
      Gee, thanks for clearing that up, Brad! If I complain about gas prices which result in another quarter of record profits I must be a liberal? And you provided us with the facts according to a Redumblican led Energy Dept. that held secret meetings with big oil after taking office. Did Karl Rove help you with that piece?
      • 7 Years Ago
      That's right, bruno, everybody and their mom knows that oil prices will come back down once President Hillary gets sworn in, right?
      • 7 Years Ago
      #22: Regarding your point (c) about the lack of new refineries, yes that's true. Heck, they've even been shutting them down pretty often. However, many refineries have been expanding pretty quickly. One way to sneak by the environmental restrictions has been to add onto refineries at a rate which is just below the level which triggers government oversight. This rankles environmentalists quite a bit.

      Yeah, nobody wants a refinery in their backyard. I agree that environmental restrictions have been a factor in putting us in the position we're in. Heck, we're importing more and more refined products over time rather than crude oil. However, with the profit margins the oil companies make, I see zero reason why they can't do their jobs in a cleaner and more above-board manner.
      • 7 Years Ago
      What we are seeing now is fallout from Katrina. After the hurricane and in 2006 many refineries deferred maintenance because they were trying to keep up with gasoline demand. A combination of fast-rising demand (2.5-3% over last year, refiners plan for 1.5%), refinery accidents and shutdowns, and the aforementioned maintenance issues, and lower gas imports, we have very high prices and 12 weeks of inventory drops.

      Oil prices are lower than last year, but refineries only operated at 89.5% last week. Gasoline inventories rose more than expected, so did crude stocks. If this trend continues prices will drop some. They're already off their highs here in San Diego ($3.39 a gallon, 11 cents lower). I've actually seen diesel as low as $2.98.

      But then, according to a trucking news source they're actually shipping 12% less cargo over the past couple months. Not a good sign for the economy.
      • 7 Years Ago
      1981 doesn't come from talking heads, 1981 is the peak year for oil prices- that's why people refer to 1981 when comparing oil prices. Kind of like saying that 1929 or 1987 were the worst crashes in the stock market. You need to have a point of reference for comparison's sake- and a knowledge of history.

      The country was in a state of malaise in 1981, courtesy of poor leadership / politics. That changed, as by 1988 gas was $1.70 cheaper per gallon than it was in 1981. What drove prices up so much from 1978 - 1981 was President Carter's price controls. Once price controls were removed by Reagan, prices steadily came down.

      In today's economy, demand for oil (and oil based products) is exponentially greater from China (where 40% of all concrete, steel and other building materials are sold) and India.

      When the media reports record profits for oil companies, they are reporting non-inflation adjusted numbers. When you adjust the profits for inflation, they're not out of line with historical profits. It's kind of like saying that Titanic, with $600M sold more tickets than Star Wars did with $460M in sales. In constant dollars, Star Wars had box office receipts of $1,043,723,179 vs $825,808,723 for Titanic. The media will, however, tell you that Titanic was the bigger hit, making more money.

      Perspective people, keep some perspective.
      • 7 Years Ago
      rem83- I'm not saying its not bad- it sucks. I was just pointing out the complete lack of research "journalists" do. They see a high gas price and automatically assume they are at the highest when in fact they aren't. I do agree though that something should be done to curve the high gas prices- such as getting rid of the EPA restrictions on the kind of gas that must be sold. There are something like 35 different mixtures of gas sold in the US. For instance, gas that is sold in NY, cannot necessarily be sold in any other state because the EPA says it can't. After Katrina, President Bush suspended these restrictions and gas prices actually went down- not by much but they could have been higher. After the suspension ran out and the EPA restrictions were re-instituted, gas shot up again. It would be nice to see these restrictions lifted for good.
      • 7 Years Ago
      Oh Boo Hoo. The price of petrol here in Australia has just hit $1.40(au) per litre, or approximately $5.30US per gallon. You guys have a lot of catching up to do.
      • 7 Years Ago
      Some of the comments have me crying with laughter.

      Here is a simple solution, if you really think that gas prices are too high, don't buy it.

      Actions speak louder than words, so if you continue to buy gas it must mean that you think it is worth the price.
      • 7 Years Ago
      #32 Colin, thanks. You are the only poster who actually understands the seriousness of the situation the world is now in.
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