I've been around the oil business all my life, mainly because that is the career my dad chose. He doesn't have anything to do with pricing and whatnot, but he did give me some interesting info about the demand for oil and why the price has jumped.
I'll type a bit here but I've got to get ready to go in a minute. He said since 1978, there have been no refineries made in the United States. Environmental groups have protested against it and laws have been passed that makes it virtually impossible to refine oil in the US. Therefore we have to go overseas to purchase about 60% of what is in the US. Obviously the other 40% is done here in the refineries we have in place. If we could build refineries here, that would help with the cost of oil, a lot!! Is there more oil in the US?? Most certainly yes, if environmental groups would allow for the drilling of it in certain areas, that woul help relieve some of the pain at the pump. Recently, (can't remember the bill right now), a bill went through Congress authorizing drilling in Alaska. Finally we can get into the oil fields we've wanted for years. But, it could be years before we feel the effects of that simply because of the oil refinery problem.
Also, people talk about BIG oil companies. There are only three of them, and there are no middle men in the business. The 3 companies take the shipments from overseas, send it here on their own ships, offload, take it to the gas stations in their trucks. No middle man there. Another thing by dad brought up that I think some people have overlooked, we keep paying for gas. (Of course, we don't have an option if we want to drive though.) Until recently, there hasn't been a lot of loud complaining about the price.
Oil companies know that we are willing to pay whatever we have for gas. We live in a free market economy. So, the companies can raise the price if they see fit and we have to pay it, because we need to. Obviously we want lower prices, but the oil companies continue to make money because of good old supply and demand. In my mind, both the consumer and the oil companies are the problem. As consumers we haven't pushed hard enough for alternative fuels, and like any business in a free economy, the oil companies increased their prices.
I know some of you aren't going to be happy with this, but my dad has been in the oil business for 40 years so I'll believe what he has to say. So don't bash what I've posted here. I just wanted to get this bit of info out there for all to see.
