Top Ten Reasons Gas Prices Go Up

It sounds like a David Letterman skit, but in reality, it's not funny at all. Reasons for increasing the price at the gas pump range from very basic to very complicated, as well as legitimate to far-fetched. It seems as though gas always goes up but never goes back down. Consumers will forever deal with higher fuel prices based on a wide variety of reasons. Some of these specific reasons, at times, can seem absolutely ludicrous. Let's explore the reasoning behind the endless fuel price increases.

1.The demand for gasoline is increasing therefore the higher price will offset the demand. Unfortunately, the problem with this theory is that fuel consumers usually cut back elsewhere instead of driving less. Even with more fuel efficient cars being produced worldwide and an elevated sense of fuel conservation, the use of gasoline seems to increase throughout developed countries and is beginning to rise even in undeveloped countires.

2. The demand for gasoline has gone down. Therefore the price at the pump must be increased due to rising storage costs. This excuse can make you laugh or cry. It goes completely against the supply and demand theory that applies to every other product or service in the world, but it has been used as a reason to raise prices anyway.

3. A Refinery needs maintenance. Oil refinerys around the world need maintenance to operate properly, safely, and efficiently. This is not a new concept and routine maintenance is well planned. It is scheduled like clockwork at regular intervals. To use refinery maintenance as a reason for increasing the price of fuel is unacceptable.

4. Winter is coming. Every year, oil and gas suppliers are shocked to find out that winter is coming. They must therefore inflate the price of gasoline based on this chilly season. This is primarily because of heating oil use. You would think that oil and gas executives would figure out that the winter season is an annual event so preparations could be made for an increased demand.

5. Summer is coming. These seasons just keep surprising the well educated upper management in the oil industry. The summer driving season, in particular, is the specific excuse. Apparently people don't drive until it gets hot.

6. Hurricane season is coming. This one also is upsetting. Hurricane season comes every year with the warming of the ocean temperatures in the summer months. We know it's on the way but we can do nothing about it. Once again, it's an annual event that shouldn't surprise anyone.

7. A hurricane has made landfall. There are times when a refinery has been struck by a weather event causing it to close temporarily and there have been times when refineries have been damaged due to a storm. But there are also times when fuel prices are increased based on the landfall of a hurricane even though it didn't disturb a refinery. Prices are raised just in case of refinery damage.

8. Terrorist activity in oil rich nations. The violent behavior of terrorists will forever be linked to rising oil prices. Security and safety on oil properties is a legitimate concern however we need to adapt and accept this as part of doing business in modern times.

9. Retail sales showing an increase. This excuse is nothing short of pathetic. To equate a slight increase in nationwide retail sales with the possibility of an increased demand for gasoline is unfair and can actually be considered price gouging.

10. Speculators feel oil should cost more. The oil speculators can increase the price of a barrel of oil with the strike of a pen. They speculate a need to raise prices based on the stock market, world politics, and a plethera of other reasons. Many of these reasons are merely attempts to predict the future.

The price of gasoline is a serious matter. Consumer confidence goes hand-in-hand with the price of gasoline at the pump and seeing constant increases will continue to hinder the fragile economy. From a personal standpoint, our best defense against rising fuel costs is simple conservation. Get creative and conserve, because gas prices more than likely won't fall anytime soon.



Source by Chet Val

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