Text 3769, 84 rader
Skriven 2007-03-18 20:15:00 av Bob Klahn
     Kommentar till en text av Roy Witt
Ärende: Business Logic 101
==========================
 ...

 DC>> It's a matter of the oil companies getting their customers
 DC>> used to paying the higher prices.  They figured that out
 DC>> in 1975.  They created a 'shortage' and raised the prices very high.

 RW> They got the idea from the 1973 oil shortage, but they
 RW> didn't raise the price high enough then, so they took the
 RW> next opportunity to do so later.

 DC>> The public was happy when the proces settled about halfway
 DC>> inbetween.  IIRC, it went from $0.50 to $1.50 and then ended
 DC>> ut at about $1.00

 RW> And it was there for a long time. Of course, the oil
 RW> companies don't drive the price of fuel, consumers do.

 Not as long as there is no real shortage. When was the last time
 you waited in line for gas? The oil industry controls the
 availability of oil. Sometimes they miscalculate, but over all
 they aren't making record profits for no good reason.

 RW> The price comes down quickly when there's a glut, but when

 They seem to go up even more quickly.

 RW> the refineries shut down for their annual formula change
 RW> from winter to spring, it creates a shortage. Which is what

 Which is of doubtful honesty. There is no good reason for enough
 refineries to shut down enough production at one time to cause
 any shortage.

 RW> you're seeing now. If it weren't for state laws requiring
 RW> refiners to comply with emissions from their plants, they'd

 Those are mostly federal laws, not state.

 RW> build more refineries, but when the epa and states demand
 RW> compliance no matter what, why should they?

 Because they don't make a profit if they don't sell petroleum
 products. They just figure in the cost of compliance. As long as
 all producers have to meet the same standards there's no problem
 with adjusting prices to compensate.

 RW> Oil refineries in California can't be built because of the
 RW> state pollution laws are worse than what the EPA mandates.
 RW> So they're stuck with the old refineries and there hasn't
 RW> been a new one built in decades there.

 So build one next door. And how many of the old ones have they
 shut down? There hasn't actuall been any increase in the number
 of refineries in a long time. It's all been improved efficiency.

 DC>> BTW, I'm not sure if it still holds now, but a study I made a
 DC>> while back showed a close correlation of gas prices in regard
 DC>> to whether a state was a Red or Blue state.

 RW> That's ludricrous. California is a Blue state and has the
 RW> highest gas prices in
 RW> all of the western states. They don't buy their oil from
 RW> the same source as say;
 RW> Louisiana, which is a Blue state and their gas prices are
 RW> commenserate with Texas prices, a red state. California

 Which doesn't mean there isn't an overall correlation. The oil
 industry would tend to take care of the states that are in their
 pocket, like those with major oil investment. Like Texas and
 Louisiana.

 RW> could alleviate their high prices by allowing oil companies
 RW> to drill offshore, but that won't happen as long as it's a
 RW> blue state.

 Or could they? Well, if they were in the pocket of the oil
 industry, maybe.

BOB KLAHN bob.klahn@sev.org   http://home.toltbbs.com/bobklahn

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