Why are gas prices going so high?

Question

Why are gas prices going so high?

Answer 1

because gas company had a hard time finding oil in 2005 - 2006, so they had to increase the price to fill in the company,...

when they saw all the money they made more they didn't bother going back down because they know that other people can't do anything about this since the world runs on oil...

leads down to SUPPLY & DEMAND

Answer 2

Ok, this isn't really an answer to your question, but in a way...buy a car that runs on natural gas (methane), so you won't have to worry about the price of gasoline. That's what I did, and I'm so glad I did. I haven't bought gasoline since it hit $3.00 a gallon back in November. Now I pay 85 cents a gallon for natural gas. It's cleaner for the environment and so much cheaper, too. Check out my source and see if one would work out for you, too.

Answer 3

This is a very complicated issue.

At the bottom of the whole price problem is supply and demand.  Anyone who leaves this out of an answer either is throwing political nonsense around or doesn't know anything about the problem.

The average driver can not explain all the steps and costs of getting a barrel of oil from Venezuela to the the local 7-11.  That's understandable.  I probably would leave out some steps (and thus costs), if I sat down with pencil and paper.  A sad number of people are only vaguely aware of where Venezuela is.

Just because the price of a barrel goes up or down 10% at the well-head does not mean a 10% rise in the 7-11 price.  One has to consider, for example, that the tankers will be paying more to transport that oil and that cost is passed on to the consumer AND thus increases that 10%.

We in the industrialized countries where a car has been a part of our lives, our parents lives, and, for some, our grandparents or great grandparents lives, usually don't seem to understand global supply and demand.  We tend to think, "Well, I am doing the same amount of driving to and from work and around town for the past 10 years."  Let me give just one example (out of probably hundreds like it).

Beijing is hosting the current olympic games as most people know.  What they don't know, however, is that modern Beijing that they see on TV today with it's streets full of cars is not the Beijing of 10 years ago, and is definitely not the Beijing of 20 years ago.  The demand only in Beijing has grow tremendously in the past 10 years and unbelievably since the 1970s.  Next figure in all the newly modern cities in China.  As China modernized, it's oil demand grew to where it was not producing enough domestically.  So next add in China's bidding on the world markets for oil.  Figure next the increasing demand all over the world.  Is the picture getting clearer what is meant by supply and demand?

Sure, the oil companies we are familiar with in town may be taking advantage to sneak in some more profits for their stockholders, but basically it's OPEC that is setting the price and any domestic production is going to be sold at that price.  If Venezuela (a major US supplier) decides to give Cuba oil at a deep discount, you can be sure we won't get any such breaks.  We will pay market price.

Answer 4

supply and demand.  Some people like to blame oil companies but its not the oil companies its the consumer.  Quit buying gasoline and see what happens.  NO, not that scam about boycotting exxon on tuesday, I mean stop.

Answer 5

I think it is because Jesus is coming back soon.When I was younger I went to church and preachers said in the last days the world will get worse.

Answer 6

1. Low Supply

2. Supply does not meet demand

3. Speculators (bargin the price)

4. Weakened dollar

5. Dependency on foreign oil

For those who believe that cutting off oil completely will solve this problem and fix the economy.... you will regret saying that. The U.S. uses oil for a lot of things. Cutting it off means cutting the services it provides. Drilling is the only way. I also don't understand what the big deal is with drilling in the Arctic regions.... why so against it?...... Afraid that land, you'll never visit or see, will be contaminated and destroyed? Give me a break.

Answer 7

There are a number of factors involved, the key being supply and demand.  Global demand for oil and gasoline have increased dramatically over the last 5 years.  The world is currently using more oil than it is taking out of the ground, which has caused a shortage.

Oil is traded in U.S. dollars.  Because the U.S. economy and the U.S. dollar are weakening, the price of oil goes up.

Speculators can and do artificially drive up the price of oil and other commodities.  When speculators buy future oil contracts they cause an artificial demand for oil which can increase the price.

There are other factors involved, but these are the main reasons.

Answer 8

Because the people who sell oil can get away with it. Supply and Demand. Money is just paper. Governments can print more money, but there is only so much oil.

Gold and oil prices follow each other. Both are in limited supply. It's not that oil is more expensive, it's that your money is just worth less.

"Monetary inflation"

Answer 9

Anytime that the demand exceeds the production the price will go up, but when the demand started to decline, you notice that the price has began to go down.

However we will probably not see it drop to the price that it was before, and this has been going on  for years, it was less than 3 years ago that we were hollering about the gas price going above $3 a gallon, and now that is what people would be happy with.

The Oil companies start saying that there is a shortage of Oil and raise the price until the consumers start to balk at the price and then drop the price, but never back to what it was before.

I can remember when we started to complain when gas went to 50 cents a gallon, and we should have done what we are starting to do now, and that is to start thinking alternative fuels.

In the 1950's Volkswagen started importing their bug, which got 40

MPH.

But Americas desire for bigger faster cars finally cause Volkswagen to go bigger and faster also.

And as long as we continue to rely on big Oil for our fuel supplies it will continue to go up.

Answer 10

one reason is the stupid ethanol that they had to put in gas. "ooh it will lower the price" no it didn't not only did it make the gas more expensive because they get ethanol from corn now food prices have gone up and with ethanol in your car you get worse gas mileage too.