Why has the cost of gas done up 25% in the past 6 months if the demand for oil has not increased 25%.?

Question

Are the trading practices of oil speculators the bigger part of the problem?

http://www.financialsense.com/editorials/engdahl/2008/0502.html

Answer 1

There are two reasons.  The gas taxes and refineries.  There too few refineries in the U.S.  California requires it's own special fuel so it requires it's own refineries.  The demand of gas has gone up, but nobody wants a refinery in their back yard.

Answer 2

Speculators believe that oil isnt done yet.  Many predicted it to go at least $150 until it started dropping (which it basically did), but some/many speculators see this as just a bump, and that it will go back up, but now more and more people are thinking its the reall deal, and the oil buble has burst....we will see.

But anyways, oil companies are also sceptical, thus not lowering the prices yet (that much).

Also, congress actually wants to keep gas prices high, as oil falls, to pay for repavement on roads/highways, etc.

So two biggest problems, congress, and speculators....

Answer 3

You have heard of speculators and Congress ? Two negative effects on the petroleum front .

Answer 4

Anticipation of lower supply, thanks to stagnant production

levels, and lack of additional refining capacity!

Answer 5

More & more dollars chasing ever tighter supplies.  The price goes up, sometimes dramatically - econ 101.

Traders & speculators are easy to blame.  But that will not fix the problem.  Either new oil supplies need to come online, we need to find alternatives to oil, or our vehicles need to be powered by something other than oil products.