Wednesday, October 26, 2005

My response to gas prices...

As I was driving yesterday I noticed that gas prices have come down by about 30 cents here in Salt Lake city. I caught myself saying "Wow, prices have come down" and I actually felt better about the price of gas. The feeling only lasted a moment. Then I remembered that $2.59/gallon is still $1 more than I want to pay for gas. I forced myself not to feel better about the decline in price. In fact, after thinking about it I was annoyed.

So, here's my theory: The petroleum demons raised the price of gas *SO* high in an effort to play on our emotions and psychologically influence our feelings towards the price of gas. The price of gas has been so high for so long that we've felt very gouged. A decrease of 30 or 40 cents makes us feel better.

The price went up so high that it hurt, and prices stayed high for quite some time so that the pain endured. We got used to feeling gouged at the pump. All of this has been in an effort to ease us into a new, and higher, standard price for gasoline. Now when the price backs off a bit (by say, 30 or 40 cents) we feel better about paying more than $2.50 for gas.

To the people beind the pricing: I will continue to use alternative methods of transportation and avoid putting my hard-earned money into your pockets so you can have higher profit margins and look better to your stockholders. $2.50/gallon is $1 more than I want to pay. Thanks for the 30+ cent price reduction, but I'm not buying it (pun intended). Keep up the Walmart-like "price rollbacks" and eventually I will cave, but not at $2.50 a gallon. I remember paying $0.89/gallon when I was in high school, which wasn't that long ago.


At 7:59 PM, Blogger Maine Man said...

Yeah, this theory has been around for a little while and this result was predicted. I think it may very well be true but I find it more fun to blame the tree-hugging special interest groups for making refineries too expensive to build. I suspect that if we had more refineries, many of the new ones would be in places other than the Gulf Coast- which would have helped avoid the excuse the robber barons used to price-gouge us all and make us like it.

At 10:02 AM, Blogger Tyler said...

Meanwhile, the oil companies are reporting record profits.

How stupid is that? They're just begging to get themselves regulated. Allow me to explain.

From about 1880 to 1920, railroad companies had a virtual monopoly on effective transportation. They flaunted this most in the 1880s-1890s. They managed to so annoy the public that politicians created the Interstate Commerce Commission to regulate the railroads - with the result that the government was telling railoads how much to charge to haul freight or passengers from Point A to Point B. In addition, in the case of passengers, the government also told the railroads what trains to run.

This was okay at first - there was still plenty of money to be made. But when things started changing around 1920, with the rise of airplanes, autos, and trucks took practically all of the passenger traffic and most of the freight - well, the goernment kept telling the railroads what rates to charge and what trains to run - and did for the next sixty years. The railroads were not free to change with the times.

And that is going to happen to the oil companies, if they don't start thinking long-term.


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