Why are we letting fuel prices rise so high?

Question

My dad said in the sixties the gas was around .35 a gallon. what gives?

Answer 1

the Euro dollar is climbing and the us dollar  is

shirking

Answer 2

Ever heard of inflation?

In the sixties, a candy bar was a penny.  So what's your point?

Answer 3

It's called the law of supply and demand. The world has a growing need for oil and the greater the demand, the higher the price. It's the free enterprise system of economics at work. When prices are controlled by government, that's called socialism, which is one step above communism.

Venezuela is a prime example of governmentprice controls. It cost's the average cattle rancher there $2.47 a pound to raise a pound of beef. The government says beef can be sold for no more than $1.85 per pound. Would you do something and lose money in the process? I know I wouldn't.

There is nothing wrong with making reasonable profit for your labors. If you work, you want to be paid, right?

Answer 4

35 cents in 1960 is about $2.34 in today's dollar, so $3 is not that out of line. Gas was actually at it's peak price wise in the 1970s. It would have to get over $4 before we'd see the highest prices ever after adjusting for inflation.

Answer 5

They blame every thing from the war to Katrina to OPEC and even not enough refining capacity. The lies never stop. It's all pure GREED.

Answer 6

Wall Street Speculation, and many uneducated /uninformed drivers.

Everything but supply and demand is driving the price higher and higher. The whole concept is explained nicely in the source below.

Answer 7

the war and rising economy. everything is getting more expensive for example candy bar - $.15 then now $.60-$.75

Answer 8

Right now, the amount of crude oil we are producing daily is less than the amount we use daily (if I remember correctly, it's around 88 mmbbls consumed with 85 mmbbls produced or something like that), so until either we produce more (I'm working on it) or we use less, prices will continue to rise. The days of cheap fuel are long gone now. From what I've heard around the industry, prices won't level off until we get up around $4.00-4.50/gallon.

Answer 9

You think that we as consumers actually have a say so in the price of fuel? Too bad it isn't true.

Answer 10

WE are letting the prices rise because we demand more.  More gasoline, more money for the labor we provide, more square footage, more horsepower, more for our children.

Inflation is normal.  Here's a simplified scenario:  We want higher wages, so our employer gives us a raise.  This increases cost of goods sold, which means a price increase.  This price increase causes other employees to get higher wages, which causes us to ask for higher wages.  It's a vicious, but very simple circle.

Demand causes increases in prices as well.  Petroleum is a global commodity which is in ever increasing demand.  With developing nations building their economies on petroleum driven machines, the governments have an incentive to involve themselves in petroleum acquisition.  Hence the Chinese National Petroleum Company, which is buying up vast amounts of global reserves.  The Chinese are attempting to protect their own interests.

In 1960, the average new car cost was $2600.  Today, it's about $27,000, an increase of ten fold.  That makes your $3 gallon of gasoline look like a bargain, doesn't it?  Add to that the fact that 1960 vehicles averaged about 15 mpg as opposed to 22 mpg today and your dad knows he's ahead of the game.

Don't forget the double digit inflation we experienced for most of the late '70s, either.  It's a surprise your dad made it through that time, considering he can complain about 3% inflation.  Tell him to fire up the Studebaker and head out to the rest home, he's late for his meds...

Answer 11

Why oh why don't they make basic economics classes mandatory for children? EVERYTHING is more expensive now, 37 years after the 1960s ended. Ask your daddy how much money he was making in the 1960s when gas was 35 cents. Ask him what his fuel expense was as a percentage of his income. Ask him what that percentage is today. ASK HIM! After he does a little math, (a pocket calculator will work for this) then you will both realize the error of his thinking, and hopefully yours as well.

Answer 12

The price of the U.S. dollar has something to do with it also they are not making as much gas right now. So we all assume the position and get hosed.

Answer 13

The oil companies, which are mostly all in tandem, decide on the prices, just like how they decide what fuel mileage cars can be allowed to get. But of course, this would involve research to prove wouldnt it, conservatives? Hint, hint, hint...................