Gas Prices vs. Oil Prices...

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robina

@nrasheed

Inactive

Posted: 17 years ago

okay Hurricane Ike came and left its destruction and gas prices at the pump soared... Oil is down to about $93./barrel ( its lowest in months...)so why hasnt the prices at the pump come down as well... Do you feel your gov. should pass a law against gas gouging? Or do you believe that the market has a right to set its own prices..

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return_to_hades

@return_to_hades

Stunner

+ 6

Posted: 17 years ago

Because oil and gasoline are traded in the futures market. There will be several discrepencies based on anticipatory prices.

Strangely in the USA there are minimum mark up laws that prevent mass chain stores like Wal-Mart from selling gas at excessively low prices and predating others.

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chal_phek_mat

@chal_phek_mat

Inactive

Posted: 17 years ago

Scenario #1

20%(I think it might be more) of the oil refining happens in the gulf coast, when a major hurricane is on the horizon as a part of the emergency step they shutdown the refineries and drain the lines. So it takes some time to restart the supplies back to the normal level

that is the reason the prices have not come to the levels of Pre-Ike times.

Scenario #2

Now the crude is $93, that is a futures rate. Someone has to actually buy that crude. Bring it to US shores(e.g ship it from KSA to USA via tankers, takes few days), refine it and then it goes into Scenario #1. So the $93 to take effect it takes atleast a couple weeks.

All the above has no relation with price gouging

Price Gouging happens at the local pumps, there are laws against it already, if you report it to the local authorities they will take actions, you can report it at the website below.

http://gaswatch.energy.gov/

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jagdu

@jagdu

Dazzler

Posted: 17 years ago

If hurricane winds were so strong, could the US not harness wind power? Set up a few grids, and the whole country will have lots more cheaper electricity.

That will save us billions on heating oil during winter.

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