As i heard on Fox News, this is the reason for high gas prices in the United States. Note: I am not playgarizing, i am just putting what i heard in my own words, aka paraphrasing.
So... The high price of gas here in the U.S. is a relentless jab at our pockets. But why is this happening? The price doesn't go down on a normal basis and no one likes that. But here are the reasons: 1. In the middle east, where most of the US's oil comes from, they are producing less. They are producing less due to the wars and uprising there. The demand doesn't stop, so the price to get it here in this first place is high.
2. India and China's demand has increased. The middle east just can't make enough at such a fast pace. So the price goes up.
I'm pretty sure all these facts are true, but correct if i'm wrong. I'm trying to write this out of sheer memory. You're welcome :-)
1. Oil bidders bid the price higher 2. Price per barrel goes up 3. It does not reflect in our prices similarly, but rather our prices grow far more than the cost of the oil 4. The government makes money
Why are our oil prices high? Because the government says so. Most of the money you pay at the pump goes right into taxes. We need gas, the government needs money. Thus a parasitic relationship is born.
The country that's willing to pay the most for it gets it that's how life is, if you're willing to pay more for something chances are they'll give it to you.
Oil traders sell to those who pay the highest price, it's a basic economic concept of supply and demand.
This will effect America, who is still getting a few of his cookies from them, but it won't effect him completely since he is getting most of his cookies from himself and his friends. His friends might charge him a little more because they can get a bigger profit out of it, but it won't effect them as catastrophically as it would other peoples.
There is no ''friend'' in economics. Commodities up for sale goes to the highest bidder, or those who have the greatest need for it, i.e, those that are willing to fork out the highest price for it. Businesses all aim to profit maximise, and if selling to China is more profitable than to America, than they will, no matter how close relations are. It makes no sense economically for businesses or a country to sell oil at a cheaper price when they can profit maximise when they turn to other bidders.
Although OPEC doesn't have half the market share, a monopoly in the real world is a business that has 40% of the market share. When OPEC bands together, they're mere control on their oil taps to restrict supplies can cause volatile fluctuations as seen in the past in the 1970s to 1980s. Given that OPEC Countries produce about 42 per cent of the world's crude oil and about 61 per cent of the crude oil traded internationally, any decisions to increase or reduce production may lower or raise the price of crude oil. They're control has since weakened, but they are more or less still the dominant player if they want to.
Why are our oil prices high? Because the government says so. Most of the money you pay at the pump goes right into taxes. We need gas, the government needs money. Thus a parasitic relationship is born.
For every dollar spent on gas in America, this is the breakdown:
Taxes: 13 cents Distribution and Marketing: 8 cents Refining: 14 cents Crude oil: 65 cents
Taxes make up quite a small portion of the price, it is wholly unfair to claim the government is feeding off oil prices. In fact, America actually taxes gasoline less than most other nations. Only two countriesâ"Kuwait and Saudi Arabiaâ"charge lower gas taxes than the U.S. and both are net global oil suppliers, not consumers. The U.S. is the world's largest oil consumer. By under-taxing gasoline -- and thus under-pricing gasoline -- the United States encourages over-dependency. Furthermore, the federal gas tax does not even come close to covering the wide array of external social costs of driving cars and trucks.
The United States federal excise tax on gasoline, as of February 2011, is 18.4 cents per gallon and 24.4 cents per gallon for diesel fuel. Compare this to the European nations. Fuel taxes in Germany are 0.4704 Euros per litre for ultra-low sulphur Diesel and 0.6545 Euros per litre for conventional unleaded petrol, plus Value Added Tax (19%) on the fuel itself and the Fuel Tax. That adds up to prices of 1.42 Euros per litre for ultra-low sulphur Diesel and 1.55 Euros per litre (approximately USD 8.10 per US gallon) for unleaded petrol (November 2011). From 23 March 2011 the UK duty rate for the road fuels unleaded petrol, diesel, biodiesel and bioethanol is 0.5795 pounds per litre. Bear in mind the greater value of the pound and Euro vis a vis the dollar.
American gas taxes are much too low. The federal gasoline tax raised $25 billion on gasoline in 2006, this wasn't enough to even maintain America's transportation system via the Highway Trust Fund, leading Congress to transfer $34.5 billion from general fund revenues to make up the funding shortfall
The real reason that gas is going up is all our politicians (by that I mean the left) keeps saying that it will take 5-10 years for us to set up oil rigs in the U.S. and it will take too long to do it so itâs not worth our time they have been saying that for about uummm I donât know 5-10 YEARS!! We have to keep getting oil from other countries (and some of them donât like us) and gas keeps going up
plz. stop crying about your high prices.... it's very cheap.
It's mainly because they're driving cars that get 10-15 MPG. I drive a car that gets 30 MPG, and I spend around 5-10 dollars a week on gas. It's not even worth noting.
We have to keep getting oil from other countries (and some of them don�t like us) and gas keeps going up
Who had the smart idea of sanctioning Iran and causing the flow of Iranian gas to stop, therefore restricting supply and therefore pushing up prices? Thank you Americans.
Also, suck it up with your blanket Republican zealot views. Obama has called for more offshore drilling.
who is "they're"? usa or europe? and where do you drive around this car that does 30mpg?
anyway in my country the hybird cars are kinda booming because they had (until few weeks ago) to pay less taxes. so alot people here drive 1-35 1-50. (1 liter - km's driving) if that matters anything =S
It's mainly because they're driving cars that get 10-15 MPG. I drive a car that gets 30 MPG, and I spend around 5-10 dollars a week on gas. It's not even worth noting.
and where do you drive around this car that does 30mpg?
On a typical day, my brother's school, my school, when I have lunch I stop by a market to get tea then home to eat lunch. When I'm done with my classes I pick up my brother then head home. After that it just depends on what I feel like doing. It varies from going to a park, a gym, a friends house, or staying home. So on a typical week I drive around 25 miles.
