What is the logic or economic reason gas prices is so high?

Question

The oil companys are making billions quarterly on gas and the economy is losing everything......wtf...Do you think the government cares they are making a bundle when without gas all prices rise and the way to get there is gas which we refuse to burn at such an outrageous price. Therfore leaving the economy in a wastland !!!

I may have stated this incorrect....But I think You get the idea I am trying to cross????

Answer 1

Here's the crux of the "free enterprise" system (capitalism). As long as anyone can charge whatever they want and justify it by saying "it's the free market determining the price" (which is true because in the free market system - anything goes), greed and avarice rule. Oil companies can charge whatever they want to because they know we have to buy the stuff, if they raise it (and they will) to $5, $6, $7 a gallon - what are you going to do about it? Nothing, except buy it and complain!

No laws are being broken, the system is broken and has been ever since Hamilton! Hooray for Aaron Burr - too bad it was too late to help!

Edit: Let me add this, I used to work as a refinery operator for Standard Oil. We built the third Iso-Reactor plant. An Iso-Reactor changes the molecular structure of the feed (doesn't matter what the feed (usually crude oil) is, to whatever product you want by adding Hydrogen atoms onto the Hydrocarbon molecules that make up all petroleum products, from propane and butane to gasoline, diesel, motor oil, and coke. In the old-style refineries it was done by distillation, where you take the lighter products off until you reach the "bottom of the barrel"/waste (maybe as high as 50% of the original crude) which was made into coke and sold to Japan for $.50 a ton so they could use it in their steel manufacturing process. They've improved the process tremendously (at least 100%) but are still using the same pricing strategies. They are able to make 100% of a barrel of crude into whatever product they want, no waste - virtually, if not literally, all the refineries these days are of that type. There is no excuse for "shortages".

Answer 2

Greed.

Answer 3

high demand = high cost

Answer 4

because of the unstable security situation in the middle east.

the middle east is the most oil rich region in the world.

Answer 5

Every male relative in my family is in some area of the oil field. Before you tear into my ***, please know none have anything to do with oil itself. There are in sales and rentals of equipment, drills, bits, etc.

I find it unacceptable, this would never fly if it were for any other necessity. I do not understand why nothing is being done. Those b******s are making record profits while middle America is left helpless.

If we could drill in America where we need to, we could dramatically drop prices. No one wants to see a rig off the shore of FL from the balcony of their beach hotel.

Answer 6

The only sound reasoning in this oil crisis is this. The way that gas is made up of crude oil. It takes more crude oil to produce gas. Now if hypothetically would the price oil would go so would the price of oil. Now saying that the price of oil has gone down due to peak effect of oil. It is my understanding of the peak oil is that supply of oil has reached the saturation point.  This being said that price of oil is going down so would the price of oil would go down. Wrong the price of gas will never go down by what it is expected to go down. It is very unfortunate that the economy is in. It seems that there is no current energy crisis but talk. No matter who is the next President  they will be not to undo this situation.